|Mobile Phone Fraudsters|
Guildford businessman Peter Lambert (not his real name) is typical of the individuals falling victim to what is now the fastest-growing area of ID fraud, already up nearly 40% this year. When he returned from holiday, he found that fraudsters had taken out nine contracts in his name, all at mobile-phone shops across north London.
His case highlights how easy it is for crooks to go into a mobile-phone store, hand over a person's personal details using fake ID, give separate bank details (not connected to the individual), then walk out with a handset worth £400 or more.
Fake ID is worryingly easy to obtain. Guardian Money has found websites overseas that produce high-quality bogus gas and electricity bills and bank statements from British Gas, EDF, npower, HSBC, Halifax, Lloyds, NatWest and many others.
We also spoke to telecoms industry experts who admitted that phone shops are so keen to sell contracts and mobile-phone insurance that they fail to carry out adequate security checks. We found that even empty savings accounts, which cannot be used to set up direct debits and therefore will not ever pay a bill, were accepted by the phone shops when setting up contracts. But when the bill goes unpaid, it is the victim's real name and address that is chased by debt collectors.
Credit reference agency Experian told us that each month around 200 victims of "mobile communications fraud" are contacting it for help with restoring their damaged credit histories. "The average value of these fraudulent accounts is currently £340," says spokesman James Jones. Experian recently warned that the illegal online trade in names, passwords and other ID details has quadrupled since 2010 to hit 3m pieces of personal information every month.
The first Lambert knew about the problem was when he returned from holiday to find a host of letters thanking him for buying mobile insurance and confirming direct debits had been set up to pay for phone accounts he knew nothing about, and from companies he had never dealt with.
The thieves had not obtained Lambert's bank account details, just his name and address, but managed to sign him into contracts using an HSBC account in Tottenham, north London.
One indicator of the laxity of checking was that each phone contract taken out in Lambert's name used the HSBC account, even though it was a savings account, not a current account, that would not take direct debits.
His case mirrors that of Andy Firth, featured in Money on 30 June. He and his partner, Jayne, both had phone contracts taken out by an impersonator who walked into a Tesco store – again handing over their real personal details but with bank details that were not theirs. Andy Firth faced a lengthy battle to get Tesco to deal with the matter, while Jayne was chased by debt collectors. Other victims have since contacted us to say the same has happened to them.
But their problems are dwarfed by what happened to Lambert. In all, his impersonator was able to dupe O2 out of two phones, Tesco Mobile handed over another two handsets, as did Orange. T-Mobile – which supplies his real mobile contract – handed over a phone without question, as did Three. Not wanting to leave Vodafone out, the thief also signed up for a phone on that network. The thief also took out seven mobile insurance policies, again with several different providers.
"In each case, my name, address and date of birth were used. I don't know what ID they showed because the companies won't tell me," he says. "It's been a nightmare to sort it all out, costing me three days of my time, and I suspect it's not over. It seems extraordinary that no one would check the bank details or ask why so many contracts were being taken out in such a short time."
Obtaining bogus ID is remarkably easy over the internet. One company, Replace Your Docs, openly promotes itself as a provider of "fake bank statements [and] fake utility bills". It promises next-day delivery of fake documents from all the major British banks and utility companies that "look as good as the original documents".
When we contacted the website, which appears to be based in Stockholm, Sweden, it told us: "If somebody is using our website for illegal reasons, we refuse to take payment or orders from them. All our documents are for novelty use or to replace old documents that you lost."
Lambert spent two hours at a branch of HSBC trying to sort out the problem: "I was told by the bank staff there was nothing they could do as it was not illegal to take out a phone contract and give someone else's bank account details. Eventually HSBC did contact me to say they had stopped the account."
He says his local police were similarly not interested in what had happened, partly because he had not lost out financially as a result. "The woman at the police station was very helpful but told me they simply don't take up cases of ID fraud as if they did, they'd have little time to do anything else."
Lambert says that, generally speaking, the phone companies were quick to accept that he (and they) had been the victims of fraud, and cancelled the contracts – except for Vodafone. Even after he had rung to explain what had happened, Vodafone staff did not cancel the phone, but let the fraudster run up a further bill of £105 in calls, Lambert says.
"When I called Vodafone again to ask why I was still getting these bills, they found a record of my [cancellation] call, and admitted that the person who took it hadn't done anything about it," he says. Lambert has no idea why he was targeted – suggesting it could happen to anyone.
A Vodafone spokeswoman said: "We are sorry it took us so long to sort this out. We should have acted immediately when the fraud was reported to us, but the adviser Mr Lambert spoke to failed to follow the correct processes. I'm afraid this was a case of human error and something that will be addressed by the customer relations management team."
The starting point for the fraud – basic details such as date of birth, name and address – can be found on the electoral roll, then topped up with data carelessly added to social networking websites such as Facebook.
There is anecdotal evidence that criminals pushed out of card fraud by chip and pin technology have moved into mobile fraud. The high value and easy saleability of the latest smartphones, coupled with a lack of security measures, make it an easy target.
Jack Wraith, head of Tuff, the Telecommunications UK Fraud Forum, says: "Mobile retail stores are very busy and the pressure is often on. Staff carry out several checks, but they are not foolproof. Thieves are using increasingly sophisticated methods and mocking up very convincing bank statements and the like to dupe staff."
The police recently shut down a website whose sole purpose was to aid fraudsters to produce fake materials. Staff are being handed what looks like genuine documents."
Asked why stores do not ask customers to return at a later time to pick up their new phone - a move that would give staff time to carry out proper checks - he suggested consumers wouldn't accept it, and would head instead to a retailer offering a same-day service.
Richard Hurley, of fraud prevention bureau Cifas, says the most recent figures show there were 35,983 reported cases of this type of ID fraud during the first three months of 2012, up 39.6% on the same period in 2011.
Meanwhile, Lambert, along with other victims, faces having to register his details with Cifas. If he applies for credit in future, he will have to produce ID to show retailers that he is who he says he is, rather than a fraudster applying in his name.
Watch Video Below: