The lifespan of a fraudster is short but prolific. After a sharpand unexplained drop in identity thefts in 2010, fraud schemesclimbed 12.6% in 2011, according to research by Javelin Strategy& Research.

The cost adds up: The mean cost for new-account fraud is $3,197. In addition, if someone succeeds in opening up an account, ittypically only takes about seven days to wreak millions of dollarsof damage across a wide network of unsuspecting customers. Yet ittypically takes institutions an average of 151 days to detect afraud occurrence.

This means that by the time account holders realize they've beencleaned out and their banks are calling their customers aboutirregular account activity, or when their credit card companies aresending them notification letters, fraudsters have already vanishedinto thin air. But they'll most assuredly be back.

Where is the disconnect? Why is our industry – on the whole – soslow to react?

Some credit unions simply conend that they have the strongestdefense against industry theft at origination, so don't see theneed to check again after the accounts are opened. Further, to somedegree a certain amount of fraud is bound to get through becausethe cost of ferreting out all of it would prove prohibitive.

With so many accounts being hacked in the first seven days of afraudster's scheme, no financial institution or person isimmune, even with the best systems in place. Fortunately,technology advances in this field have delivered new weapons toflag suspicious consumer data patterns early in an account'shistory – a huge milestone. Old tactics are simply insufficient touncover criminal activity at its current level.

We have found that accounts that may have looked good whenopened may have turned high-risk because of activity picked up bythe latest technology – activity that homes in on how data is usedacross numerous transactions.

By shifting strategies and monitoring newly opened accounts, wehave found significant lift for fraud captures among our customersdue to the use of cutting-edge technology.

Some Tips to Help You Stop or Prevent Fraud

• Be aware that fraudsters most bulldoze their way throughaccounts and disappear within 15 days, yet it takes an average of151 days to identify it.
• Be vigilant to warn your customers about fraudsters andidentity thieves

• Ask your customers to pinpoint questionable behavior, such asnew account openings without a birth date, but with the same nameand Social Security number.

• Re-check accounts after they have been opened, whichcan identify suspicious activity allows for a significant lift infraud captures.

Last year, victims of a data breach were 9.5 times more likelyto be a victim of identity fraud. Consumers who received a databreach notification had a fraud incidence rate of 19%, whileconsumers who didn't receive such a notification had a rate of 2%.Also, with a shocking 67% jump in data breach victims in 2011, theincrease correlates directly with the rise in identity fraudvictims.

This rise in identity crime comes as banks and lenders continueto look for ways to improve their profit margins on their creditholdings. It also underscores the need for more advanced tools tohelp credit unions detect and nab fraud perpetrators, who stealbillions of dollars – both from them as well as innocentconsumers.

KeirBreitenfeld is senior director,Fraud and Identity Solutions,for ExperianDecision Analytics.