Daily Insurance Industry News
 
 
Daily Insurance Industry News
Tuesday 14th of August 2018
November 19, 2010

Direct debit fraud hits all time high

by Richard Kilner

Story link: Direct debit fraud hits all time high

New research conducted by the Centre for Economics and Business Research (CEBR) on behalf of home insurer LV= has revealed that 97,000 Britons have fallen victim to criminals setting up fraudulent direct debits from their accounts.

So far this year 26,000 Britons have discovered criminal direct debits, which typically see criminals gaining £540 before the fraud is noticed and halted.

There has been a staggering 288% rise in the practice over the last four years, with 6200 incidents reported in 2006.

The sharp rise is attributed to the introduction of Chip and PIN, which makes stealing cards and using them for gain more difficult, and has prompted criminals to look elsewhere.

More than one in 10 identity fraud cases are accounted for by direct debit payment fraud (10.6%), up from 0.01% in 2001.

As identity fraud continues to rise, LV= provides its home insurance policyholders with a free identity helpline.

Fraud is also on the rise in the motor insurance sector, and in September the AA described fraud as a major contributor to the 31% hike in car insurance premiums.

Although some see fraud as a crime without a victim, such practices increase premiums for law-abiding citizens and as such actually detrimentally affect a huge number of honest people.

 

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