Credit crunch sees fraud increase

Posted 2008-04-30

The UK fraud prevention service has claimed the effects of the credit crunch have contributed to more consumers lying on application forms for loans and credit cards.

CIFAS claims there was a ten per cent increase in the number of fraud cases compared to 2007, with 52,286 reported cases.

The BBC claims that lies on application forms have risen from 19,239 in the first three months of 2007 to 21,870 this year, representing a 13 per cent interest.

Chief executive of CIFAS, Peter Hurst, suggested that the current financial climate is driving people towards this dishonesty.

"Because people are getting into debt earlier, and because the credit crunch has diminished their access to finance, they are now resorting to fraudulent applications for funds," he said.

The most common lie was found to be a failure to disclose a previous address, where the applicant may have a poor credit history.

CIFAS comprises 270 members across banking, telecommunications and credit card sectors.

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