While FLA statistics showed
actual cases of motor finance fraud down 14% over the course of
2010, a separate report by global information company Experian has
shown the incidence of fraudulent applications up 31% in the
sector, to a level of 38 out of every 10,000.
Attempted frauds across the
UK financial services sector as a whole increased by 11% in 2010,
with 20 fraudulent applications per 10,000 compared to 18 in
The increase in attempted
motor finance fraud was higher than for any other type of finance,
although it is likely that the increase in the number of genuine
applications brought about by 2009’s scrappage scheme inflated the
year-on-year change in Experian’s fraud index.
James Taylor of Experian said
that, while 80 to 90% of attempted fraud seen by car lenders was
first-party fraud in which applicants failed to disclose poor
credit history or true employment details, the remainder was
third-party fraud involving attempts by criminal gangs to obtain
cars for sale.
“While third party fraud is less common in the car finance
industry,” he commented, “it represents a greater risk because the
chances of recovering fraudulently acquired vehicles are much
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData