Death records release scheme to help fight identity fraud

Published by Jon Land for 24dash.com in Communities and also in Local Government

A new scheme is hastening the demise of a cruel type of identity fraud that can devastate grieving families and cost businesses millions of pounds a year.

Finance firms have hailed the release of the names of every person who has died in the UK each week as a pivotal step in the fight against fraudsters impersonating the dead.

This type of fraud takes many forms; from criminals stealing the identities of dead people from obituaries for forged credit applications, to dishonest family members claiming pensions long after their relative has died.

Identity fraud protection service CIFAS believes this is one of Britain's most common forms of identity theft, while the Government estimates the cost of identity fraud to the UK economy is at least £1.2billion.

Since September the UK's three Registrars General have released around 140,000 death records to carefully vetted organisations to match against their clients' databases. Already tens of thousands of matches have been made against business records helping to prevent potential frauds.

One subscriber to the scheme administered by the General Register Office (GRO) estimates that at least one in 400 pensions are being claimed fraudulently by families despite their relatives having been dead for many years.

Mortality checks have even found a case where a woman was found claiming her aunt's pension to pay a mortgage on a house ten years after the old woman had died at the age of 98.

In another case, a pension company was informed their client had died six weeks before the family informed them allowing them to stop payment immediately.

Home Office Minister Meg Hillier said: "The use of death records in this way will have a dramatic impact on fraudsters abusing people's deaths - a crime which causes financial and personal distress to both businesses and individuals alike.

"We're sending a strong message to criminals: if you try and steal the identity of someone who has died to commit fraud you will be found out."

Four firms have already been accredited to receive death register information with around a dozen more going through the stringent licensing process. Businesses can then submit records such as pension claims, insurance claims and credit applications to the licensees to find out if an individual is deceased.

Faraday Tracing Bureau (FTB), a pioneer of mortality screening has been carrying out checks for nearly 10 years and is one of the original four firms to be accredited by the GRO. It conducts mortality checks for over 200 well-known pension funds.

FTB sales director Chris Rattenbury, said: "Firms undertaking mortality screening were finding on average that one in four hundred pensions were being claimed fraudulently sometimes for as long as ten years".

"This new process will stop this kind of fraud completely. Pension Schemes will be saving huge sums of money not only in fraudulent claims but also in administration costs.

Tracesmart Ltd, another of the original firms to be accredited, supplies mortality screening to major financial institutions and pension schemes.

Michael Trezise, Managing Director of Tracesmart, said: "This is proving to be a pivotal weapon in the battle against fraud. We've identified a considerable volume of deaths within our client's customer databases, which allows them to prevent the deceased's identity from being used for fraud- protecting both company and customer alike.

"As more and more companies begin to use this data, we are confident that the level of this fraud will significantly drop.

"Simply the knowledge that death record information is being used to tackle fraud is a considerable deterrent to would-be fraudsters."

Peter Hurst, chief executive of CIFAS the UK's Fraud Prevention Service said: "The number of individuals affected continues to be far too high. Identity fraud is serious, and no-one should be complacent about it which is why this initiative is so important in helping to stamp it out.

"Quite apart from financial losses, the effect on victims can be very distressing. In the case of impersonation of the dead, the effect on bereaved relatives can be devastating. And where any victim's identity has been seriously compromised, it can be an extremely time-consuming and frustrating process to untangle the threads of deception."

Keith Hollender, Commercial Director of the National Association of Pension Funds, which speaks for 1,200 pension schemes with assets of around £800 billion said: "The decision by the GRO to release names held on the Death Register is welcomed by pension schemes.

"For many years, scheme managers have struggled to find an effective way to make sure they receive prompt notification of a member's death.

"Genuine mistakes, for example when relatives forget to tell the scheme that a member has died, and deliberate fraud can cost pension schemes and insurers millions of pounds both in terms of monthly cash outlays and incorrect valuations of liabilities.

"This decision will help minimise costs and has made the administration of pension funds much easier."