Imagine returning from a well-earned holiday and putting your key in your front door only to find the locks have been changed…. then a stranger opens the door and asks who you are. That’s exactly what happened in the UK this year.
And it’s no isolated incident. 2022 has already been the worst year ever for identity fraud and digital crime – and the sheer volume and impact of these crimes is growing exponentially all over the world.
Insights company TransUnion reports a 33% rise in global fraud in financial services, 68% in travel and leisure, and an unbelievable 800% in shipping, to name just a few. The same report cites a 104% rise in identity mining and a 113% rise in business identity theft. The effects are being felt in almost every industry sector today.
There are three major reasons for this.
Firstly the global economy has been thrown into turmoil by rising inflation, supply chain disruptions, the war in Ukraine, and increased food, energy and housing costs. New Zealanders are facing the crippling impact of crazy house price rises, stagnant salaries and a huge rise in living costs. It’s not surprising that New Zealand has become a prime target for fraud, with online safety organisation NetSafe reporting an 86% rise in identity fraud cases in the country last year.
We now lead complex, interconnected digital lives, and this provides fraudsters with so many more angles of attack on our identities and data
Secondly, the challenges we face have impacted criminals too. Lockdown made it far more difficult to move stolen products, launder cash or import drugs, thus putting pressure on their cash flow. Criminals have had to learn to adapt to our changing world as much as we have, and identity theft remains one of the easiest crimes to perpetrate and to avoid being caught. No wonder, then, that financial services research agency Javelin Strategy reports that across the world there’s a new victim of identity theft every two seconds.
And finally, of course, we have the seismic changes to our lives and to consumer behaviours that came with the COVID-19 pandemic. Social media management firm HootSuite reports that in over twenty countries including the US, India and South Africa, we spend more of our waking lives online than we do in real life. Business News Daily reports that online shopping is closing the gap on physical stores, and may overtake ‘in-person’ shopping by 2023.
We now lead complex, interconnected digital lives, and this provides fraudsters with so many more angles of attack on our identities and data. Plus digital innovation has propagated the emergence of innovations like ‘Buy Now, Pay Later’ products, where there is next to no due diligence when it comes to opening an account. The lack of regulations in this industry is opening the floodgates for more fraud to be committed.
The global cost of fraud is just over $7trillion and is set to continue to increase as new non-regulated products like Buy Now Pay Later begin to enter the market.
It’s easy to be pessimistic about identity fraud, especially given the perfect storm of global challenges, adapting criminals, and untested digital innovations. But there are ways to combat it. Exciting new technologies have been created to help and detect fraud using a combination of data from multiple data sources including email and social media. We’re now seeing people becoming more aware of what it means to accept cookies (which may be moot given the coming ‘Cookie-pocalypse’), and to share data. We are beginning to realise the value of our online selves to businesses large and small, and are therefore becoming more vigilant about protecting our identities.
But if you’re planning a holiday soon, it’s worth asking friends or family to keep an eye on your home while you’re away. Just in case.