Top causes of identity fraud
Identity fraud increased substantially in 2008, reversing a four-year trend of decreasing incidents. Researchers say identity fraud increased by 22 percent last year and they anticipate another 22 percent jump in 2009, attributing the increases to crimes of opportunity driven by the economic downturn1.
What’s more, despite recent headlines and growing fears about online security and data breaches, old-fashioned theft is the most popular way thieves steal identities and perpetrate identity fraud.
According to 2008 claim data compiled by Travelers, burglary and theft of wallets, purses and personal computers provide thieves the best opportunity to gain access to personal information. In instances where the victim knew their identity had been stolen, it was the result of personal property being stolen nearly 78 percent of the time.
Travelers identifies the following as the top known causes of identity fraud:
- 78% – burglary and theft of wallet/purse/personal identification/computer
- 14% – online or data breach
- 5% – change of address/postal fraud
- 3% – lost credit card and other miscellaneous causes.
What do thieves do with the information once they have it? More than 75 percent of the time, they use the information to open new credit card accounts or use the existing credit cards to make charges. Twenty percent of identity thieves will withdraw money from existing checking, savings and online accounts and 16 percent open utility accounts in the victim’s name.