Identity fraud on the rise
New report shows smartphone users that access social media at higher risk of identity fraud
The number of identity fraud incidents increased by 13% in 2011, affecting 11.6 million adults across the globe, according to the recently released 2012 Javelin Strategy & Research Identity Fraud Report.
The report also showed that specific social media behaviours and an increasing number of data breach incidents contributed to the increase in the overall amount of identity fraud instances in the United States in 2011.
The report was co-sponsored by Intersections Inc, a consumer and corporate identity theft risk management services provider, and provider of an identity theft protection service called Identity Guard Total ProtectionSM.
"Intersections is pleased to once again be a co-sponsor for this year's Identity Fraud Report. As a leading expert in the industry, it is a testament of our promise to continue to educate consumers on the dangers of identity theft and inform them of the steps they can take to help protect themselves from becoming a victim," said Steve Schwartz, executive vice president of Consumer Services for Intersections Inc. "The rise in victims and data breaches is a cause for concern for both consumers and businesses. As more consumers turn to unconventional communication methods, such as social media and smartphones, doing so in a safe and responsible way must now become a priority."
According to the report, victims of a data breach were 9.5 times more likely to be a victim of identity fraud. In 2011, there was a 67% increase in data breach victims.
The total dollar amount tied to losses remained steady, despite the increasing number of identity fraud victims in 2011. Better consumer awareness efforts by government and financial institutions and more stringent authentication practices by financial institutions are likely to have helped keep these costs from rising.
Smartphone users that actively engage with social media were found to have a much higher chance of becoming victims of identity fraud than consumers who do not engage in these mediums.
According to the report, fraudsters are hacking into large businesses where many identities are housed in one place, utilizing data taken from social networks.
Intersections has warned that exposing common information, such as birthdates and addresses puts consumers at a greater risk, as these elements are commonly used by financial institutions for security questions and validation of identity to access accounts. The company said that consumers should take extra care when deciding who to connect with and what applications to accept. Users that approve friend requests from strangers and use GPS/location based applications are far more susceptible to fraud.
The report showed that electronic monitoring of accounts through the internet, ATM or other electronic means is the leading way of detecting fraud over reviewing paper records. Fifty-four percent of victims were notified they had been a victim of identity theft by their financial institution or law enforcement.
Consumers also need to make sure their network connection is secure and their devices have updated security when accessing online and mobile banking.
"We are excited to have Intersections support this important study for the fourth year in a row," said Jim Van Dyke, president and founder of Javelin Strategy & Research. "Our research clearly indicates that consumers who are using identity protection services are experiencing a reduction in fraud costs compared to all consumers. And for those that do experience fraud, the resolution time on these fraud cases is lower as well