Identity Theft

Your identity is a valuable commodity, and as such can be misused by the criminal or traded for value on the black market. As a consumer you need proof of identity to open bank accounts, obtain credit cards, finance, loans and mortgages or to obtain goods or services, but you may not be the only person using your own personal details. Identity can be stolen and used in a variety of ways. Fraudsters can impersonate you and take out various forms of credit using your previously unblemished name and good credit history. They can even take over your existing bank accounts by pretending to be you. All the fraudster needs is a few of your details and a document bearing your name and/or your address make it even easier to facilitate this; e.g. a discarded recent utility bill.

Identity fraud and identity theft are often used very loosely to describe any situation in which personal details are misappropriated for gain, and is the fastest growing type of fraud in the UK. The following definitions have been developed:

• Identity Crime is a generic term for Identity Theft, creating a False Identity or committing Identity Fraud.

• Identity Theft occurs when sufficient information about an identity is obtained to facilitate Identity Fraud, irrespective of whether, in the case of an individual, the victim is alive or dead.

• Identity Fraud occurs when a False Identity or someone else’s identity details are used to support unlawful activity, or when someone avoids obligation/liability by falsely claiming that he/she was the victim of Identity Fraud.

How is identity fraud linked to money laundering?

Criminals need to launder, or clean the proceeds of their crimes - they want to get dirty money into the financial system. A criminal's funds need to look as if they originate from a legitimate source, and the criminal needs to operate without being caught or arousing suspicion. Criminals therefore need financial products, services or accounts. They are unlikely to use their own identity, as this would leave a link to them. This is why, under Money Laundering Regulations, financial services firms must check to ensure they ‘know their customer' before opening an account or providing a service.