Wise Up When it Comes to Online & Identity Fraud

The loss by staff at Her Majesty’s Revenue & Customs of two CDs that contain sensitive information about 25million UK residents is only the latest in a series of high-profile scare stories that highlight the need to protect our personal and financial information, and prevent us becoming the unwitting victims of identity fraud.

In 2006 an estimated 178,000 people in Britain were affected by identity fraud which cost the country close to £1.7billion. There is a thriving illegal market in stolen identities where the price of obtaining someone’s date of birth, credit card details and other sensitive information can be as little as £7.

Of course, when the government potentially gives away our personal information there is little we can do. And, it’s not just government incompetence that poses a risk; fraudsters infiltrating commercial organisations and stealing customer’s details is also a real threat, and one that has reared its ugly head recently.

A member of staff at the Cardiff call centre of Tesco Direct – the online & catalogue shop for superstore giants Tesco - was arrested after stealing shopper’s debit and credit card details. Working in the telephone orders department the fraudster passed on the customer’s personal and credit card details to accomplices in London who then used them to buy goods. Of course, Tesco customers will be reimbursed their losses, but those who were affected will have suffered a great deal of inconvenience and worry, and their confidence in using their cards online or on the phone may well be shattered.

The combination of the tax office fiasco and the calculated infiltration of Tesco has prompted a lot of opinion from fraud experts about the seriousness of these security breaches. Some, say the information lost by the government would be of little use to potential fraudsters, but others say there is enough information there for criminals to start making significant inroads into stealing numerous people’s identities.

But, what can you do to minimise the risk? It has always been important to compare credit cards and the benefits that they offer when shopping around for a new card, but now a growing number of credit card deals include online fraud protection as part of the package. For those worried by recent events and who do a great deal of online shopping this should be considered an essential benefit. As well as refunding you in case of loss, you will also have peace of mind.

Although there is no way to stop government incompetence or commercial fraud, if you possess UK credit cards that offer fraud protection at least you won’t be out of pocket in the long run should the worst ever happen.