The Government has been urged to take steps to help combat the growing problem of identity fraud, which costs the UK economy a massive £1.3 billion a year.
A new report by the Fraud Advisory Panel (FAP) argues the government needs to clarify situations in which data-sharing between businesses is lawful in order to tackle the problem.
The number of identity thefts in Britain rose from 27,270 in 2001 to 42,029 last year, costing victims an estimated £62.5 million per year.
The problem is also not easy to resolve – according to the Home Office it takes an average of 300 hours for victims of identity fraud to reverse the damage done.
The report outlines methods used by fraudsters, including obtaining false passports and other documents under different names.
Small business owners are also warned to be wary while in the workplace – the study revealed fraudsters regularly used invoices and company stationery to acquire goods without paying for them.
Another popular tactic employed by criminals is to create copycat websites to gain money and credit card details when customers attempt to pay for goods from online retailers.
The FAP has called for a database of fraudulent activity and stolen information to be set up, so authorities and business owners can gain a better understanding of the methods used by fraudsters.
Steven Philippsohn, head of the working group which produced the report said the government should clarify situations in which data-sharing was permitted.
“Greater data-sharing and cross referencing of information about known frauds and fraudsters between governmental agencies and the business sector will mean there is a better chance of detecting identity theft at an earlier stage.
“Fear of the regulators swooping down is hindering attempts to reduce fraud by mean of data-sharing.
“Many organisations and police investigators are unaware that section 29 of the Data Protection Act allows for certain exceptions to be made to its general principles when personal or financial data is processed for the purposes of crime prevention.
“This must be made clearer,” he said.
The FAP report can be downloaded free here.
ID theft: a $1bn a year crime
Police recover disk at centre of ID theft flap
NJ couple accused of mass ID theft
Student owns up to Texas Uni cyber-heist
Trainee dishwasher pleads guilty to $80m identity fraud