The rate of identity theft-related fraud in the US has risen sharply since 2003, a report from research firm Gartner suggests. And the story is somewhat similar in Australia.
Gartner's study, released Tuesday in the US, shows that from mid-2005 until mid-2006, about 15 million Americans were victims of fraud that stemmed from identity theft, an increase of more than 50 percent from the estimated 9.9 million in 2003.
According to the Australian Competition and Consumer Commission, identity theft costs billions of dollars.
"On identity theft alone, losses to the Australian community are estimated to be in excess of $1 billion annually."
"There seems to be a scam created to trap just about everyone -- from dodgy e-mails and text messages, to phishing, to lottery scams, to fake investment schemes, bogus medical cons, to the Nigerian letters, to fake employment and money laundering schemes, to identity theft," said Louise Sylvan, ACCC deputy chair, in a recent statement.
ACCC statistics have shown that in the last four months, a total of AU$5.2 million has been lost to scams and rip-offs.
"Consumers should be aware that all sorts of people fall for these kinds of slick swindles and that they need to be alert in order to protect themselves. The problem isn't going away. The scammers are out there, and they're active with new tricks," Sylvan said.
To fight this menace on an international level, the Australian Federal Police will include an identity theft squad within its Indian office when it sets up shop there this year.
For its study, Gartner surveyed 5,000 American adults who use the Internet. The research firm found that identity theft victims are losing more money and getting less of it back. The average loss of funds in a case of identity theft was US$3,257 in 2006, up from US$1,408 in 2005. Additionally, the average loss in the opening of a fraudulent new account has more than doubled over that time, from US$2,678 to US$5,962.
According to Gartner, identity theft victims are also recovering less of the lost cash. In 2005, an average of 87 percent of funds were recovered; in 2006, that had dropped to 61 percent.
The research firm attributed the rise in identity theft fraud to increased levels of electronic identity theft.
"Hackers are exploiting Internet auctions, non-regulated money transmittal systems, the ability to impersonate lottery and sweepstake contests, and other types of imaginative scams," Gartner analyst Avivah Litan said in a statement.
However, the supposed rise in identity theft is a controversial claim. Last month, research firm Javelin Strategy & Research released a report that suggested certain identity-theft statistics -- the number of fraudulent accounts opened, for example -- are actually on the decline.
Ed's note: It should be noted that the 2003 statistics and the mid-2006 statistics came from two different sources -- and hence, two different statistical methodologies. The original 9.9 million figure came from the Federal Trade Commission, whereas the 15 million statistic is Gartner's own.
ZDNet Australia's Fran Foo contributed to this report.
