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The Observer: How to play your cards right and foil the identity thieves

How to play your cards right and foil the identity thieves

Buying a shredder isn't enough in the battle against laptop criminals, says Lisa Bachelor

Sunday May 14, 2006
The Observer

'Technology breeds crime. Crime is getting easier, faster and harder to detect. There are no conmen anymore dressed in debonair suits with a briefcase and salesman's patter. Now anyone with a laptop can take your money. It's impersonal and easy to do,' says Frank Abagnale.

And he should know. Between the ages of 16 and 21 Abagnale cashed $2.5m worth of fraudulent cheques in every US state and 26 other countries, successfully posing as an airline pilot, a lawyer, a college professor and a pediatrician before being tracked down by the French authorities and incarcerated in various international prison systems.

The story of his life was captured on film in the Steven Spielberg-directed movie Catch Me If You Can, in which Leonardo DiCaprio played Abagnale. These days the former conman is a respected consultant and lecturer on fraud and embezzlement, continuing to work with the FBI, which freed him from prison more than 30 years ago on the condition that he would, unpaid, help them tackle fraud and forgery.

His visit to London last week could not have been more timely. Financial fraudsters have hit the headlines again after chip and Pin readers in 600 Shell service stations were tampered with, resulting in the theft of more than £1m. The criminals used scanning devices similar to those used by fraudsters, targeting cash machine users to copy the cards' magnetic strips and record Pin codes.

'What I did 40 years ago is 4,000 times easier to do today,' says Abagnale. 'For me to have replicated a cheque 40 years ago I needed a $1 million printing press. Now I can do it on my laptop in minutes.'

The increasing use of technology for criminal ends has meant that the number of cases of identity theft rose by 17 per cent in the first quarter of this year alone from the same period in 2005. Despite this, two out of three Britons underestimate the likelihood of becoming a victim of ID theft, according to credit reference agency MyCallcredit.

'Consumers have to take a position of being proactive. You can't rely on the government, the police or your bank,' says Abagnale.

Protecting yourself

· Monitor your credit records regularly with all three credit reference agencies: Experian, Equifax and MyCallcredit.

Abagnale says the only way to deal with identity theft is to know it is going on the second it happens. He is in the UK to promote Privacy Guard, which for £6.99 a month will monitor your credit record around the clock. However, unlike the US version of the product it only works with Experian and not all three reference agencies. And Experian offers a similar service for £5.99 a month with a 30-day free trial.

The only service that provides access to your files from all three credit reference agencies in one go is For just under £60 a year you can access your data as often as you want from these agencies. Unfortunately the information Experian provides to checkmyfile is not comprehensive. You can see whether you are on the electoral roll, for example, but the Experian data will not show if anyone has applied for credit in your name.

By far the cheapest way to keep up to date with your credit records is to apply for them regularly by post. They can take up to seven days to arrive and cost £2 each time. All the agencies offer this service.

· You might have heard the one about buying a paper shredder a few times before. Abagnale has a word of warning: 'If you use a straight shredder I can put back together the strips, and read word for word, a front page of the FT. This is what thieves can do to your documents.

'The way to prevent this is to use a cross-cut shredder, which is the same price as a straight one. Unfortunately everybody goes out and buys the straight ones without knowing any different.' A cross-cut shredder produces criss-cross pieces of paper, which are much harder to reassemble than straight strips.

· Close any unused accounts. 'Too many people, when they decide to stop using a credit card, either stick it in a drawer or cut it up, but that's not enough,' says Mycallcredit director Alison Nicholson. 'Unless you tell the card company you want to cancel it, the card remains live. If a fraudster gets hold of the details they can rack up bills without your knowledge.'

· Don't waste money on expensive identity theft insurance policies. These don't stop you becoming a victim; nor do they prevent you from having to do some work to help sort out the mess if you do fall prey to the fraudsters. You are not liable for any losses. The policy only offers advice – which the credit reference agencies and Citizen's Advice will do for free – and allows you to claim back any expenses you incur.

· Even after you have deleted files on your PC or laptop, they can still be found and used. Cifas, the UK's fraud prevention service, recommends that you obtain a clean-up tool to overwrite deleted files. It says that this is especially important if you are discarding old equipment; the only way to prevent your data from being retrieved by a fraudster is physical destruction of the equipment. Most local authorities will do this for you.

· The National Consumer Council wants the government to adopt a minimum standard of service for dealing with ID fraud. It is asking people who have been victims of ID fraud to get in touch and tell it about their experiences. You can contact the NCC by email at: [email protected].

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