John Ndegwa
10 December 2007
Nairobi — Some months ago major supermarkets put out a notice warning its loyalty cardholders to watch out for devious operators with intentions of swindling them.
Apparently some con artists masquerading as sales representatives were attempting to get bank account information from card holders by sending hoax text messages informing them of having won prizes from the supermarket chain.
"Smart Card holders must exercise caution before releasing any information to any party and beware that Nakumatt does not seek any bank account information from any customer," warned one of the alerts.
The Nakumatt caveat was just one of the many similar forewarnings that consumers are becoming accustomed to as cases of fraud become rampant.
Identity (ID) theft or fraud, which is one of the bloodless forms of crime, is slowly taking root in the country.
Though not a major problem yet, some Kenyans seem to have mastered the art of ID fraud by pretending to be in need of help and asking for bank account information from gullible individuals.
According to Frank Griffiths, the group chief executive officer at Fina Bank, ID theft is rife in the developed world than it is in Kenya. "ID fraud is not a big problem as yet in Kenya as it is in the developed world," he states.
As technology becomes a way of life and as financial institutions adopt information communications and technologies (ICTs) in their operations, the predicament is bound to catch up with Kenya.
The worse, according to Griffiths, is that we are not fully prepared for such an eventuality. "We are only partially prepared in this country to deal with massive cases of ID theft," he states.
What, then, is ID fraud and how can consumers protect themselves from ID fraudsters? First, it's important to note that all forms of crime are driven by motive and opportunity.
ID theft is thus a form of crime that entails an illegal usage of another person's identity. It involves a fraudster getting access to enough information about someone and using it to impersonate the real owner and carry out a crime using the information.
The information could be lifted from documents like birth certificates, bank statements, credit/debit card slips, driving licences and passports and could be used to open bank accounts, obtain a loan or mortgage, obtain new credit cards and purchase goods and services.
Electronic transactions
Opportunities for ID fraudsters are immense in electronic transactions.
In the past few years the country has witnessed a significant increase in the usage of credit and debit cards. Statistics by Visa International indicate that in the financial year ending June, there were a total of 1.1 million Visa cards and 6,900 merchants.
During this period, the total number of transactions (payment using Visa cards) at the merchants stood at 2.7 million representing a 28 per cent increase compared to the previous year. There is no doubt that as credit cards usage becomes popular, cases of ID fraud are bound to increase.
"As technology becomes a way of life, we might be confronted by more cases of ID fraud," observes Griffiths, adding that the onus would be mainly on individuals to ensure they safeguard their identities.
He explains that banks, for instance, are careful when handling customer information and when undertaking any transactions. Confidentiality is paramount and no bank can debit a customer's account with his/her authorisation.
And while most banks encourage customers to personally collect their debit/credit cards and personal identification number (PIN), the two are usually mailed differently in a situation where they have to be sent through the post office.
Although ID theft can be a traumatising experience for the victim and can even take months before the fraudster's actions are discovered, being cautious reduces the possibility of becoming a victim.
The basic precaution is to ignore the numerous emails and text messages asking for your bank account details and to treat all your personal data as confidential. When doing online shopping, it's usually important to look out for a secure domain before giving out credit card details. Scrutinising you bank and credit card statements keenly is also crucial. Report any strange transaction in the statement to the bank or card issuer.
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