Bank fraud on the rise

The UK's Fraud Prevention Service (CIFAS) has reported a massive increase in the fraudulent misuse of bank accounts in the UK.

Despite no increase in the number of bank account frauds actually recorded during the first eight months of 2011, CIFAS has found a 12% increase in instances of bank accounts being fraudulently misused. 

The figures show that over 65% of all fraudulent misuse of bank accounts relates to false or altered cheques that subsequently bounce along with fraudulent electronic payments. Identity fraud has also decreased slightly from same period of last year, yet this still accounts for 47% of all bank account frauds; by far the highest overall proportion, says CIFAS.

Even more worrying though, is the rise in 'money mules', those used by existing criminals to launder money. According to CIFAS, money mules are individuals who either knowingly help, or are tricked, into moving money through their own accounts and then to a third party.

Such activity is often hidden under the guise of 'payments and refunds' or 'commission and cost' for the products or services, and by using 'mules' in this way the criminal can create a chain of transactions and "get away with stolen money".

"Financial insecurity, of course, explains how victims of such 'money mule' activity came to be duped by criminals," said CIFAS Communications Officer, Dean Bové.

"Organisations must, therefore, be alert to the fact that the difficulties facing the 'man in the street' may lead them to carry out actions that they would otherwise never consider. Furthermore, members of the public must be similarly aware of the ways in which criminals can prey upon their monetary insecurity, in order to make them accessories to financial crime."