The number of U.S. adults who fell victim to an identity crime jumped 22 percent in 2008, while the costs of recovering from such incidents dropped significantly, according to an annual study published this week.
The 2009 Identity Fraud Survey Report, released by Javelin Strategy & Research, found that the number of identity-fraud victims climbed to 9.9 million in 2008, reversing a three-year trend of falling fraud rates. While the total fraud costs increased 7 percent over the previous year, the improved ability to detect and respond to fraud caused the average cost to consumers to drop 31 percent to $496 per incident, the report stated.
"The good news is research shows consumers have more control than they may think and more of them are actively taking steps to protect themselves," James Van Dyke, president and founder of Javelin Strategy & Research, said in a statement. "Additionally, the financial industry has made significant strides to resolve fraud incidents for their customers and put stronger controls in place to limit fraud, which is lessening the impact of this crime."
The research, based on telephone interviews with 4,800 consumers, highlights that consumers face many of the same trends as businesses. A recent study by the Ponemon Institute found that the cost of data breaches have risen for businesses, but that the cost of response to each incident has fallen as companies have become better at dealing with breaches. Similar to the previous year's study, Javelin's latest report found that low-tech methods of using identity for fraud — such as lost or stolen wallets, checkbooks and credit cards — were still the most popular, accounting for 43 percent of all incidents.
Fraudsters appear to be working more quickly, Javelin stated. In more than 70 percent of the cases of identity fraud, the actual fraud started appearing less than a week from when the data was stolen, the company said. In 2005, only a third of initial fraud occurred in the first week.
In 2008, the typical fraud incident involved criminals obtaining $4,849 on average. In addition, women were 26 percent more likely to be victims of identity fraud than men, Javelin found.
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Posted by: Robert Lemos