Dark Reading is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Risk

2/11/2009
03:19 PM
Connect Directly
Google+
LinkedIn
Twitter
RSS
E-Mail
50%
50%

Identity Thieves Face Pay Cut

While the number of fraud incidents is rising, criminals are earning less for each crime they commit.


Overall Fraud Impact 2003-2008

Overall Fraud Impact 2003-2008
(click for larger image)
Identity thieves, like other workers in today's troubled economy, have had to endure a pay cut.

Despite a 22% increase in the number of fraud incidents in 2008, compared with 2007, the cost of identity fraud to consumers dropped by 31%, according to a report released Monday by Javelin Strategy & Research.

"We may be seeing the first signs of the proverbial shrinking of the middle class among fraudsters, or at least a shrinking in average value among individual cases of fraud," said Jim Van Dyke, president and founder of Javelin Strategy & Research, in an e-mail. "We are seeing signs of increasingly deliberate action on the part of criminals, with increases in crimes that have both shorter and longer average duration between information exposure (theft of data) and information usage (fraudulent transactions conducted with someone else’s identity information).

"Is it fair to say criminals are taking a pay cut? Yes, if we're referring to the average profit a criminal realizes on a per-crime basis. While there are more crimes, more crimes are being committed (at a lower average amount per) to realize the same amount of profit. This is no different from someone having to work overtime in order to realize the same gross pay they once made with fewer hours."

Javelin's 2009 Identity Fraud Survey Report says that the average consumer cost of identity fraud fell 31%, from $718 to $496 per incident, its lowest level since 2005. It attributes the decline to faster fraud detection, reduced fraud amounts, and more rapid complaint resolution, brought about by industry efforts and consumer education.

Even so, the rise in the increased number of fraud incidents is troubling because it reverses the declines in fraud seen over the past four years. The Javelin report says that the increase corresponds to "reports of an increase in crimes of opportunity seemingly driven by economic misfortune and availability, and targeting immediate gains." Fraud rates typically increase as the economy declines, the report says.

The upward trend is amplified by the increasing sophistication of global identity theft rings, the rising market for secondary financial information, and the availability of fraud toolkits online.

One measure of that sophistication is the speed at which identity thieves strike. In 71% of reported incidents, the report says, the fraud began less than a week following the theft of the data. That's 33% faster than fraud incidents in 2005.

Despite the prevalence of online fraud, low-tech attack methods -- stolen wallets, checks, credit cards, or mail -- still represent the most common way that personal information is obtained. Forty-three percent of fraud incidents where the method of compromise was known involved such methods.

It may be for this reason that women were 26% more likely to be the victims of identity theft than men in 2008. According to the report, women make more purchases in stores, where low-tech attack methods can be applied.

Fraud arising from online access to information accounted for only 11% of incidents with known methods of compromise.

It's worth noting, however, that the method of compromise is known by only 35% of fraud victims.

InformationWeek's 2008 Security Survey shows that, while companies are spending more on security, their data may not actually be safer. The report offers advice from CIOs and information security practitioners on how to use risk management principles to protect essential data (registration required).

 

Recommended Reading:

Comment  | 
Print  | 
More Insights
Comments
Newest First  |  Oldest First  |  Threaded View
COVID-19: Latest Security News & Commentary
Dark Reading Staff 7/6/2020
Ripple20 Threatens Increasingly Connected Medical Devices
Kelly Sheridan, Staff Editor, Dark Reading,  6/30/2020
DDoS Attacks Jump 542% from Q4 2019 to Q1 2020
Dark Reading Staff 6/30/2020
Register for Dark Reading Newsletters
White Papers
Video
Cartoon
Current Issue
How Cybersecurity Incident Response Programs Work (and Why Some Don't)
This Tech Digest takes a look at the vital role cybersecurity incident response (IR) plays in managing cyber-risk within organizations. Download the Tech Digest today to find out how well-planned IR programs can detect intrusions, contain breaches, and help an organization restore normal operations.
Flash Poll
The Threat from the Internetand What Your Organization Can Do About It
The Threat from the Internetand What Your Organization Can Do About It
This report describes some of the latest attacks and threats emanating from the Internet, as well as advice and tips on how your organization can mitigate those threats before they affect your business. Download it today!
Twitter Feed
Dark Reading - Bug Report
Bug Report
Enterprise Vulnerabilities
From DHS/US-CERT's National Vulnerability Database
CVE-2020-15570
PUBLISHED: 2020-07-06
The parse_report() function in whoopsie.c in Whoopsie through 0.2.69 mishandles memory allocation failures, which allows an attacker to cause a denial of service via a malformed crash file.
CVE-2020-15569
PUBLISHED: 2020-07-06
PlayerGeneric.cpp in MilkyTracker through 1.02.00 has a use-after-free in the PlayerGeneric destructor.
CVE-2020-7690
PUBLISHED: 2020-07-06
It's possible to inject JavaScript code via the html method.
CVE-2020-7691
PUBLISHED: 2020-07-06
It's possible to use <<script>script> in order to go over the filtering regex.
CVE-2020-15562
PUBLISHED: 2020-07-06
An issue was discovered in Roundcube Webmail before 1.2.11, 1.3.x before 1.3.14, and 1.4.x before 1.4.7. It allows XSS via a crafted HTML e-mail message, as demonstrated by a JavaScript payload in the xmlns (aka XML namespace) attribute of a HEAD element when an SVG element exists.