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Some banks remain naive about credit fraud, despite a 52 per cent jump in suspicious applications in the past two years, Veda said.
The credit data analytics firm reported that $1.9 billion of credit applications in 2013/2014 were “high risk” and with “potential links to known fraud events”.
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The volume of red-flagged applications has risen 52 per cent in two years, while credit growth has only reached 40 per cent.
Credit applications are red-flagged, or highlighted for further investigation, if the applicant’s address or driver’s licence or other details are associated with a previous fraud.
Veda’s general manager of fraud and identity solutions, Imelda Newton, said some lenders were not alert to the danger of credit fraud.
“While most major credit providers in Australia conduct fraud checks on credit applications, there are a number of lenders who process high-risk applications unaware of possible links to fraudulent activities,” she said.
Those lenders include banks, credit unions, payday lenders, auto-finance providers, telecoms and utility companies, she added.
Ms Newton also said that fraudsters were constantly changing their points of attack on credit providers.
“While the mode of fraud may change, the individuals perpetuating fraud are often the same,” she said.
[Related: Veda reports fall in credit demand]
