Identity theft is on the rise, and it’s becoming more sophisticated than ever. Cybercriminals are evolving their tactics, exploiting current events like the cost of living crisis to manipulate individuals and businesses into handing over sensitive information.
According to the National Fraud Database, identity theft now accounts for nearly 70% of all fraud cases, with a 23% increase in 2022 alone.
Research from Cifas revealed that 2022 saw the highest number of fraud cases ever recorded in the UK, with a staggering 409,000 reports, 68% of which were identity-related.
While older individuals (particularly over 60) remain common targets, businesses are increasingly in the crosshairs, often because they present more lucrative opportunities for fraudsters.
In this article, we tackle the rise of identity theft fraud and how to protect against it. We’ll discuss:
- What is identity theft and why is it increasing?
- How common is identity theft in the UK?
- How identity theft has evolved
- Why are businesses frequently targeted in fraud cases?
- What is business identity theft?
- What are the risks of business identity theft?
- How can businesses protect themselves from identity theft?
- Should your business outsource cybersecurity?
- Get support from qualified experts
What is identity theft and why is it increasing?
Identity theft occurs when someone unlawfully obtains and uses another person’s or organisation’s personal or financial information to commit fraud. This could mean opening credit accounts, making purchases, accessing confidential systems, or even impersonating a company to deceive clients or suppliers.
So, why is identity theft on the rise?
There are several contributing factors, but one of the most significant is the sheer volume of personal and business data now available online through social media, company websites, data breaches, and unsecured systems. As organisations become more digitally connected, they also become more vulnerable to exploitation if proper safeguards aren’t in place.
Additionally, identity thieves have become more strategic and opportunistic, often tailoring their scams to mirror real-world events and social anxieties. From COVID-19 health scams to fraudulent energy rebate emails during the cost-of-living crisis, cybercriminals know how to tap into public uncertainty to increase their success rate.
The combination of technological convenience, economic pressure, and clever social engineering has created the perfect storm for identity fraud to flourish, making proactive protection more critical than ever for businesses of all sizes.
How common is identity theft in the UK?
Identity theft is no longer a niche threat, it’s now one of the most prevalent forms of fraud in the UK. According to data from Cifas, the UK’s leading fraud prevention service, 2022 saw a record-breaking 409,000 fraud cases, with a staggering 68% linked to identity theft. That’s nearly 280,000 cases involving stolen personal or business credentials in just one year.
While individuals over 60 are often seen as vulnerable targets, businesses, particularly small to medium-sized enterprises, are increasingly falling victim. Why? Because companies often hold more valuable data, higher credit limits, and looser verification procedures, especially when dealing with suppliers, new hires, or financial institutions.
Whether it's an email scam impersonating HMRC or someone using your business registration number to open a fraudulent credit line, identity theft is now a mainstream threat, and one that no organisation can afford to ignore.
How identity theft has evolved
Identity theft is no longer confined to stolen wallets or breached databases; it has matured into a highly adaptive, socially engineered threat. Today’s identity thieves use tailored strategies that exploit moments of vulnerability, public fear, and even compassion.
We’ve seen this play out in real time. During the COVID-19 pandemic, scammers impersonated trusted institutions like the NHS and public health bodies to trick people into handing over personal data. More recently, with the cost of living crisis dominating headlines, fraudsters have shifted tactics, posing as banks, lenders, or energy providers offering relief schemes or financial aid.
What makes this evolution particularly dangerous is the blending of technology and psychology. Criminals now craft convincing phishing emails, spoof websites, and even deepfake voices to impersonate real brands, colleagues, or government entities. Meanwhile, the explosion of personal data shared across social media and professional platforms gives attackers even more material to work with.
And it’s not just individuals in the crosshairs; businesses are being impersonated too, as fraudsters apply for credit, open fake accounts, or defraud suppliers using stolen company details.
In short, identity theft has moved beyond crude scams. It’s now a strategic and scalable operation, and organisations that fail to adapt their defences risk being left dangerously exposed.
Why are businesses frequently targeted in fraud cases?
While individuals are often victims of identity theft, businesses have become increasingly attractive targets for fraudsters, and for good reason. From financial gain to access to sensitive data, companies offer a wide attack surface that cybercriminals are eager to exploit.
Here’s why businesses are so often in the crosshairs:
- Larger account balances: Companies typically manage higher-value accounts, making them far more profitable to infiltrate than individual users.
- Higher credit limits: Fraudsters posing as businesses can access bigger lines of credit, increasing the potential payout.
- Frequent high-value transactions: Large or recurring payments are part of everyday business operations, so fraudulent activity can often go unnoticed, especially if it blends in with regular financial behaviour.
- Publicly accessible information: Key business details (like directors’ names, registered addresses, or supplier relationships) are often available on company websites, social media, or Companies House, making it easier for fraudsters to impersonate the business or manipulate internal contacts.
In short, the scale, visibility, and routine financial activity of businesses make them ideal candidates for identity theft scams. That’s why it’s so important to implement layered security measures and educate your team before you become a target.
What is business identity theft?
Business identity theft occurs when a criminal steals or impersonates a company’s identity to commit fraud. Unlike personal identity theft, which often involves accessing bank accounts or credit cards, business identity theft typically targets larger financial systems, vendor relationships, or credit facilities under the company’s name.
Here’s how it usually works:
- A fraudster gathers enough publicly available information, such as your business registration number, director names, trading address, or VAT details.
- Using this data, they impersonate your business and apply for lines of credit, purchase high-value goods, or even open fake accounts with banks, suppliers, or service providers.
- In some cases, criminals may go as far as changing your company’s registration details or filing false documents with government bodies to take full control of your business profile.
Because businesses are expected to conduct large transactions and communicate with many third parties, suspicious activity can easily fly under the radar. That’s why many companies don’t realise they’ve been targeted until damage has already been done. whether that’s financial loss, reputational harm, or compromised relationships with partners and clients.
What are the risks of business identity theft?
Business identity theft can lead to far more than just financial loss, it can disrupt operations, damage relationships, and seriously undermine trust in your brand. And in many cases, the true cost only becomes clear after the fact.
Here are the key risks associated with business identity theft:
- Financial loss: Fraudsters may use your company’s identity to open credit lines, order expensive equipment, or run up large debts in your name. These can go unnoticed until payment defaults occur or creditors start calling.
- Reputational damage: If a criminal impersonates your business to defraud customers, suppliers, or partners, it can erode trust and tarnish your reputation, especially if word spreads online or through industry networks.
- Operational disruption: Responding to identity theft often requires urgent internal investigations, legal consultations, and process overhauls; all of which can drain time and resources from day-to-day business.
- Legal and compliance exposure: If sensitive data is leaked or misused in a fraud operation, your business could face regulatory scrutiny or even liability under data protection laws like GDPR.
- Loss of customer and supplier confidence: Clients may hesitate to continue working with a business that’s been compromised, while suppliers might pause transactions if they suspect your company details have been tampered with.
In short, the risks are broad and can escalate quickly, especially for small to mid-sized businesses that may not have dedicated cybersecurity teams in place.
The good news? With the right protective measures, many of these risks are preventable.
How can businesses protect themselves from identity theft?
Protecting your business from identity theft isn’t about a single solution. The good news is, even simple actions can make a big difference. From securing sensitive data to monitoring your business identity for misuse, prevention starts with awareness and continues with ongoing vigilance.
Here are the most effective ways to reduce your risk:
- Secure business data: Limit the amount of sensitive information you share online and train staff to follow best practices when handling data internally.
- Audit accounts regularly: Review credit reports, financial accounts, and company registration records to detect unusual activity early.
- Install cybersecurity and anti-fraud tools: Use advanced software to flag suspicious access attempts, phishing emails, and unauthorised transactions.
- Perform regular security operation monitoring: Monitor your IT infrastructure in real-time to spot anomalies and respond quickly to threats.
- Rigorously test for risks from human error: Deliver ongoing staff training and conduct penetration testing to uncover weak points before criminals do.
- Get support from qualified experts: Partnering with a managed cybersecurity provider can ensure your systems and protocols are professionally maintained and up to date.
In the following sections, we’ll break down each of these steps in more detail, so you can build a clear action plan tailored to your business’s risk level and resource capacity
How can businesses protect themselves from identity theft?
Protecting your business from identity theft requires a strategic, multi-layered approach. It’s not just about investing in software; it’s about creating a company-wide culture of vigilance, backed by strong systems, regular monitoring, and expert guidance. Below are five key pillars every business should build into its identity theft prevention plan…
Secure business data
Start with what you control, your data. Limit the exposure of sensitive company details across public platforms, especially director names, financial identifiers, and contact information. Internally, implement a robust data security policy that outlines what employees can and can’t share, and train staff to follow it closely.
To go a step further, consider having key personnel sign non-disclosure agreements (NDAs), particularly if they handle sensitive or financial data. This adds a layer of legal protection and reinforces accountability.
Audit accounts regularly
Routine checks are your safety net. Regularly audit your bank accounts, credit profiles, and business registration details to detect anomalies early. Even small, unexplained changes, such as a new credit application or altered Companies House record, could signal identity theft in progress.
These audits not only protect your financial health but also help you meet compliance obligations and reduce long-term risk.
Install cybersecurity and anti-fraud tools
Modern identity theft prevention relies heavily on the right tools. Install up-to-date cybersecurity software across your network to detect and block phishing attempts, unauthorised logins, and malware. Anti-fraud solutions that use AI and behavioural analytics can flag suspicious activity, long before a human would notice.
For more insights on choosing the right protection, check out our guide: Top 12 Cybersecurity Tools for Businesses.
Perform regular security operation monitoring
Cybersecurity tools are powerful, but pairing them with real-time monitoring gives you the best of both worlds. Security operations centres (SOCs) or managed detection and response (MDR) services provide around-the-clock oversight of your network, flagging anomalies as they occur.
At Lyon Tech, our analysts actively monitor client environments so that if a breach attempt occurs, we can react in real-time, minimising damage and responding swiftly to secure your systems.
Rigorously test for risks from human errors
Human error remains the number one cause of data breaches. To reduce this risk, regular cybersecurity training is essential, but it shouldn’t stop there. Consider implementing penetration testing, a controlled simulation of cyberattacks, to reveal real-world vulnerabilities in your people and processes.
These tests help identify gaps in training, lapses in protocol, and systems that may need tightening before an actual attacker does.
Should your business outsource cybersecurity?
For many small and mid-sized businesses, handling cybersecurity entirely in-house can be both overwhelming and risky. While larger organisations may have dedicated IT security teams, many SMEs rely on generalist staff or ad hoc solutions, leaving critical gaps in protection.
Outsourcing cybersecurity to a trusted managed IT provider offers several advantages:
- Access to specialist expertise: Cybersecurity is complex and ever-changing. Outsourcing gives you access to trained analysts who live and breathe security, and stay up to date with the latest threats and technologies.
- Round-the-clock monitoring: Threats don’t follow office hours. With an external provider, you gain continuous security oversight, reducing response time in the event of an attack.
- Cost efficiency: Building and maintaining an in-house security team is expensive. Outsourcing allows you to scale protection to your needs, without the overheads.
- Faster implementation of tools and policies: Experienced providers can recommend, deploy, and configure tools quickly and ensure they’re tailored to your industry and risk profile.
- Ongoing compliance support: Whether you’re handling personal customer data or regulated financial records, outsourced providers can help you meet GDPR and other compliance standards with ease.
Cybercriminals are increasingly targeting businesses with limited resources. Partnering with a qualified cybersecurity provider helps level the playing field, offering the peace of mind that your systems are actively protected, without placing extra strain on your internal team.
How Lyon Tech helps protect businesses from identity theft
At Lyon Tech, we understand that identity theft isn’t just a cybersecurity issue, it’s a direct threat to your business’s financial wellbeing, reputation, and operations. That’s why we offer tailored protection strategies designed to suit businesses of all sizes across London.
Here’s how we can help:
- Proactive threat monitoring: Our dedicated analysts provide real-time security monitoring to detect suspicious activity the moment it happens, so we can act before damage is done.
- Custom cybersecurity solutions: We assess your current infrastructure and implement the tools, protocols, and policies that match your industry, compliance needs, and threat profile.
- Expert-led penetration testing: Our team can simulate real-world attack scenarios to expose gaps in your systems, training, and procedures—before a cybercriminal finds them first.
- Staff training & risk awareness: We help upskill your team through practical workshops, awareness campaigns, and policy creation—turning your people into your first line of defence.
- Advisory & response support: Whether you’re preparing for compliance audits, responding to a breach, or need guidance choosing the right cybersecurity stack, we’re here to advise and act fast.
Business identity theft is on the rise, but it’s not inevitable. With the right support and strategy, you can defend your company against even the most sophisticated threats.
Get in touch today to find out how we can help secure your business.