With the announcement this week that UK interest rates have risen to the highest level since 2009, Cifas, the UK’s leading fraud prevention service, is warning that the rise in living costs could see a sharp rise in consumers and businesses being targeted by criminals.
According to the latest Cifas data, fraud is already on the rise. Last year over 360,000 cases of fraudulent conduct were recorded to the National Fraud Database, meaning a case was filed by UK organisations on average every 90 seconds.Reported cases of identity theft have been steadily rising, with 2021 seeing cases soaring by nearly a quarter when compared to the previous year. Although fraudsters mainly targeted the plastic card and banking sectors, more recently they have turned their attention to the online retail and loans sectors.
Fraudulent attempts to access loan products increased by 39% in 2021, with unsecured personal loans heavily targeted. With just over half (54%) of UK consumers saying they plan to use Buy Now, Pay Later services to manage their finances over the coming year, there is concern that criminals will focus on businesses providing loans and deferred credit services, specifically looking to exploit those who have more relaxed criteria than others.
Fraudsters have also been quick to take advantage of consumers struggling with the rise in the cost of living, with a reported rise in calls offering fake ‘get rich quick’ schemes and investment opportunities – especially those involving cryptocurrency. Criminals are also increasingly using social media to recruit money mules, with younger people being specifically targeted.
Misuse of facility accounted for just over a fifth of cases filed to the National Fraud Database in 2021. Nearly three quarters of these cases (72%) indicated mule activity, with the sharpest rise (19%) taking place amongst those aged under 21 years.
Amber Burridge, Head of Fraud Intelligence for Cifas, said “Criminals are glorified marketers – they’ll exploit any opportunity to steal from innocent consumers. More recently we’ve seen fraudsters posing as energy suppliers and travel providers, as well as offering ‘get rich quick’ schemes and fake investment opportunities – even impersonating charities asking for donations to help with the crisis in Ukraine.”
“Fraud is a huge problem and we are all potential victims. Keep yourself safe by stopping and thinking carefully before parting with your money or information, whether over the phone or on the internet. Report any fraudulent activity to Action Fraud, and tell your bank immediately if you have been the victim of fraud.”