“Your highest risk is ultimately at institutions where you apply for credit. We find that various fraudsters will get your personal information, assume your identity and then actually apply for credit. That is definitely one of the biggest concerns,” Compuscan legal compliance officer, Annelene Dippenaar, told CNBC Africa.
“Fraudsters will go and incur other liabilities or enter into other agreements, for example, cell phone contracts or insurance. Its wider than just banks but the financial institutions – banks, other lenders – are definitely the highest risk [regarding] identity theft.”
(WATCH VIDEO: Identity theft on the rise in S.Africa)
While the exact amount may be hard to quantify, identity theft reportedly costs the South African economy an estimated one billion rand annually.
“What we’ve found is that there was about 1,370 reported cases of identity theft in South Africa from January to the end of April this year. We found that there’s about a 16 per cent increase year-on-year on that number,” Dippenaar said.
“We expect that number to increase to over 4,000 reported cases in 2014 alone – that is only the cases that have been reported to the South African Fraud Prevention Services. There’s many other cases that we are not even aware of.”
Rudolph Lamprecht, chairperson of cyber protection company, Phishield emphasised the fact that identity theft is being experienced worldwide.
“The problem is getting worse and worse every year. We’re looking at a global scale – we collected our data from the RSA, a well-known security company [which] all the banks use. Globally, phishing specifically is climbing about 43 per cent a year so it’s an ever-increasing problem,” he said.
According to Lamprecht, there are a number of key steps that one needs to follow should they become a victim of identity theft.
“First of all you need to get a hold of the major credit bureaus like TransUnion or Experian, notify them your identity has been stolen. Also, get a credit report and see if any accounts have been opened. If any have been falsely opened, get a hold of the creditors, notify them – they will close those accounts,” he explained.
“Thirdly, you have to file a police report. If you bank account has been compromised, contact your bank. Change your usernames and passwords.”
(READ MORE: S.Africans are casual with their personal information)
Dippenaar further stated that one must also be able prove that they are a victim of identity theft to avoid being liable for any falsely-opened accounts.
“If you go to the credit bureaus, log a dispute and advise them that you did not incur that liability – the credit bureaus will investigate. You also need to [be] proactive, for example, list yourself with protective registration at the South African Fraud Prevention Services,” she said.
“The problem however is that that debt will remain on your credit profile if you are not proactive in trying to clear your credit profile. It’s something that can haunt you for a while after. It’s very important to be diligent and [to] talk to the bureaus.”