Losses related to an average case of Internet-initiated fraud were AU$551 compared to AU$4,543 lost from fraud tracked back to paper statements, according to the 2005 Identity Fraud Survey conducted by the Better Business Bureau and Javelin Strategy & Research.
The survey, which follows an earlier study carried out by the Federal Trade Commission in 2003, indicated that Internet-related crimes are actually less severe, less costly and not as wide as previously thought.
The total amount of money lost due to identity fraud in 2004 was AU$52.6 billion--about the same as in 2003. And the total number of victims dropped to 9.3 million in 2004 from 10.1 million in 2003.
"This new research contradicts some common assumptions about identity theft fraud and points to new paths of prevention. There are several steps consumers can take to improve their identity safety and protect themselves against this type of fraud. An informed consumer is an empowered consumer," Ken Hunter, chief executive officer of the Council of Better Business Bureaus, said in a statement.
The survey said computer crimes accounted for only 11.6 percent of all known-cause identity fraud in 2004. Half of those crimes stemmed from spyware, software that surreptiously tracks users online or causes ads to pop-up when the consumer is online.
"Our numbers show that fears about online identity fraud may be out of proportion to the relative risk, causing consumers to ignore the most glaring issues," James Van Dyke, Javelin's founder, said in a statement. "Indeed, most instances of identity fraud occur through traditional channels and are paper-based, not Internet-based."
Users can protect their financial data by using updated software that protects against spyware and viruses and by and not responding to suspicious e-mail ploys that request personal data. By managing their financial accounts through a password-authenticated Web site, the report added, "consumers can reduce access to personal information on paper bills and statements that may be used to commit identity theft and fraud."
Also revealing was the finding that half of those who committed the online crimes are closely related to the victim either as a friend, family member or neighbour.
It's all ok then, excuse me. This coincidentally nicely timed survey, is aimed at restoring consumer confidence for online transactions, and providing bank managers with a false sense of security. The online attacks will increase in sophistication at a rate never seen before - it is called a 'spike'. Get ready for the ride.