Five in 100 Americans Get Scammed by Fraudsters
More than 5 per cent of Americans were scammed by identity fraudsters last year, according to a report by Javelin Strategy and Research.
In 2012, identity fraud increased for a second consecutive year, especially because of new account and account takeover fraud, two of the most dangerous scams. The company said the number of victims rose to 12.6 million.
At least half of the losses were absorbed by financial institutions and merchants. Other victims weren’t so lucky and bore the cost of fraud, which increased to $365 per person in 2012, from $354 the previous year.
In account takeover fraud, cyber-criminals change the victim’s contact information and hijack their account, whereas in new account fraud, they use victims’ identity to open accounts in their name. Identity thieves usually steal personal details through data breaches and malware attacks.
“By changing consumer contact information, fraudsters can limit the consumer’s ability to be notified of fraud while redirecting any newly requested payment cards,” Javelin said. “The misuse of store-branded cards could allow fraud to go undetected longer, as these accounts are less likely to be reviewed or used than general-use credit cards.”
The Javelin data was based on a survey of more than 5,200 U.S. adults, including 857 who were fraud victims in the past six years.