Rise of ID fraud rings see victim numbers surge

The rise of organised cyber-crime has led to a near 70 per cent surge in the number of people falling victim to identity fraud, a report showed.

Credit reference agency Experian warned of the "industrialisation" of identity fraud - the escalating involvement of organised criminal gangs.

ID fraud trends have moved away from opportunistic criminals to professional fraudsters who are "e-enabled, IT savvy and anti-social networked", it said.

Some 2,124 people contacted Experian's victims of fraud service, which helps people "clean-up" their credit report after falling prey to fraudsters, in the second half of 2006 - up 69 per cent on the year.

"We see this very much as the tip of the iceberg, because the people we deal with are those aware enough to request a copy of their credit report," Jill Stevens, Experian's director of consumer affairs, said.

Rising immigration to Britain was one of the key drivers of ID fraud, she said, as criminal gangs made a trade out of plying British nationals' passports and other documents.

But technological developments meant fraudsters could operate on an international scale in the underground economy.

Anne Green, a fraud consultant at Experian with 20 years' experience investigating ID fraud, said: "Fuelled by the growth of the internet, identity fraud has, over the last ten years, transformed from a cottage industry to a mass-market crime opportunity.

"A significant proportion of identity fraud today is carried out by no more than a few hundred sophisticated criminal gangs running global identity fraud rings involving a complex network of associates, middlemen, techies, hackers and runners, often recruited and managed via the internet."

Security firm Symantec's latest bi-annual internet security threat report uncovered a variety of underground economy trading servers - the "criminal eBay" - being used to sell a range of stolen personal and financial information on a global scale.

A typical menu of information for sale included a UK-based credit card with security number for as little as one pound, a verified PayPal account with a balance for £25 or an online bank account with a £5,000 balance for £150.

Fraudsters could also buy 29,000 e-mail addresses that could be used in "phishing" attacks - when criminals purport to be financial organisations to lure people into parting with their personal data - for around £2.50.

"The most interesting thing is not the fact you can get this stuff, it's the sheer volume of information for sale," said consumer sales director Lee Sharrocks.

"There's been an explosion in this kind of thing; the internet threat has gone from the virus attacks we saw a few years ago to a whole new category of threats."