ID Fraud: It could never happen to me, or could it?

1 in 4 of us will suffer ID Fraud at some point. Despite being very vigilant and taking precautions, how could ID fraud happen to a money-savvy financial adviser?

How to reduce the chance of ID Fraud

How our story unfolded

First, we noticed an unusual deposit on our credit card – it was a sizeable deposit. When money flows in, you may not feel the same urgency or consider there to be something untoward. We considered if there had been a refund or if it was just a genuine mistake soon to be rectified. Due to the size of the deposit we soon realised it wasn’t a refund and blocked the card via the app.

The next day there was a large cash transfer out, still less than the deposit. At the same time, we had two email notifications; the first was a notification of a change of direct debit details on the credit card account, and the other thanked us for the transfer request and that it was being processed. Something was amiss! It was time to speak to the credit card provider. 

The following few hours were spent confirming every transaction over the last few months and setting up additional security. We immediately cancelled the credit card as we realised that we were the subject of ID fraud.  

The credit card provider confirmed that somebody had called impersonating us and managed to pass all the security questions. The emails we received identified that an account had been set up in our name with another bank. We had the sort code and bank details from the email and were able to contact the bank. Due to our line of work, we are well aware of the anti-money laundering checks expected to set up an account, so we presume the fraudster has also managed to forge documents. Not only this but the new account was opened by another bank, not an individual – a true web of deceit! 

At this point, we did not know the extent of the fraud or if this was just the tip of the iceberg.  

What actions did we take?

We contacted the credit reference agencies Equifax, Experian and TransUnion and put a freeze on the accounts to stop anyone from applying for credit. So, now anyone trying to get credit in our name means we would be alerted, and additional checks would be required.  

We also discovered our email addresses had been traded on the dark web. Equifax informed us of this chilling information as part of their service. 

We reported our scenario to Action Fraud and also signed up to Cifas. Cifas is the UK’s fraud prevention community, working with numerous organisations in various sectors. We’ve requested protective registration, which puts a warning flag against our name, telling any organisation that uses Cifas to pay special attention when any products are applied for in our name. 

As you can imagine, it was a traumatic and worrying time! Plus, this experience all happened while we were on holiday abroad. Coincidence? Unlikely. 

Even if you discount the upset, the pure hassle factor was considerable. We only have one credit card, so the whole process caused massive disruption as we needed to cancel payments for numerous subscriptions and our day-to-day spending, as well as wait while new cards were issued. And, of course, we weren’t at home to receive the new cards. 

We do wonder – was this money laundering? 

Many would not be overly concerned if there was an in and outflow that still left you in positive territory. If ID fraud can happen to a money-savvy financial adviser, it can happen to anyone. 

What have we learnt?  

  1. We check our financial accounts daily so we can spot the issues and intervene at an early stage.
  2. The credit card provider was helpful, however, they couldn’t confirm what security questions were answered correctly by the fraudster. Security questions are often similar from one bank/credit card provider to another, meaning these fraudsters could pass security questions again. I suggest using different questions and answers for your bank and various credit cards.
  3. We are considering a second credit card that we use solely for subscriptions.
  4. We have good protection on our computers and phones, but it was a good reminder to change passwords on all accounts regularly.

Situations like this always serve as a reminder to remain vigilant. If a financial adviser can get caught, then others are even more vulnerable.

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