Identity fraud has risen by almost 25 per cent in the past five years but what can you do when it happens to you? Confused.com’s new writer, Naphtalia Loderick reveals all.
As a personal finance journalist, I like to think of myself as a savvy consumer. I can recite the Sale of Goods Act, well some of it, and I know all about Section 75 of the Consumer Credit Act - the one that protects you for purchases made on your credit card.
But when I discovered someone had fraudulently used my credit card details to purchase mobile phone top-ups, I was stumped.
I only discovered the fraud when I called my credit card company to pay my balance. My ears pricked up when the automated service reeled off £30 transaction after £30 transaction. "But I haven't spent on my card in the past month," I said.
Customer services confirmed that these transactions had been made to the Orange mobile phone network. "But I'm not with Orange," I protested. "These transactions aren't mine!" I was baffled.
Particularly as I had my credit card in my hand but then I realised I had been a victim of skimming. This is where thieves attach card readers and small cameras to cash machines to capture your card details and your PIN.
Skimming can also happen using card readers in restaurants and petrol stations. All it takes is one crooked employee to put your card through a machine which electronically copies the information held on its magnetic strip.
This all falls under the banner of identity fraud - using stolen or false identity to obtain goods and services by deception. And according to anti-fraud organisation CIFAS, identity fraud has risen by almost 25 per cent over the past five years and accounted for nearly half of all frauds recorded in 2010.
So what could I do about the fraud on my account? Well, my credit card provider told me to contact Orange.
Orange told me they couldn't help as I wasn’t a customer of theirs. Talk about being given the runaround.
I went back to my credit card company who agreed to cancel my card and issue a new one. They also sent me forms to sign and return confirming the transactions weren't mine, which would lead to an investigation and hopefully a refund of my money, I was told.
The refund was forthcoming, the outcome of their investigation unfortunately not - why would they share it with me? I'm only the defrauded cardholder after all! But that should have been the end of it right? Wrong.
Imagine my surprise when, a month later, I received a statement for my new account - with another fraudulent transaction to Orange listed!
I wrote to my credit card provider demanding an explanation and refund. To this day I have heard nothing. And yet, despite knowing my rights and despite being money-savvy, I have yet to make an official complaint about my credit card company to the Financial Ombudsman Service (FOS) which investigates complaints by consumers about financial businesses.
But writing this has made me realise I really do need to get that complaint letter written, because while identity fraud of this type remains a matter for credit card companies and not the police, my experience suggests there is little effective deterrent to fraudsters.
They will go on nicking our names, addresses and credit cards numbers in the knowledge that the police and the credit card companies rarely come after them.
Here are my top tips to stop yourself becoming a victim of credit card or any other type of identity fraud:
• Check your statements regularly. CIFAS has found that while 94 per cent of people think they are at risk of ID fraud, only 44 per cent regularly check their statements for rogue entries.
• Don't just bin financial paperwork, shred it.
• Many of us organise our finances online. Make sure you have the latest anti-virus software on your computer and update it regularly.
• If you have been defrauded and are in the unfortunate position of having to contact your bank or credit card provider, put your complaint in writing. State clearly why you are complaining and what remedy you are seeking. The bank has 40 days to respond. If it doesn't, you can take your complaint to the FOS.
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