IN THE wake of the major blunder this week by HM Revenue and Customs (HMRC), which has left 25 million people at risk from potential fraud after computer discs containing sensitive information disappeared, experts are warning of a "climate of fear".
Phil Worms, director of Netintelligence, a Glasgow-based firm which specialises in online security, said the biggest effect of the HMRC's mistake was this feeling of nervousness could help crooks get the information they want.
Worms said: "With a climate of fear, people panic and, in that environment, identity theft crooks don't even have to have all the data they need. They can play on that fear and start sending e-mails and calling people at home, saying they're from their bank and suggesting people change their passwords, for example. If anyone responds to this, they've provided information that the fraudsters were after in the first place.
"Don't respond to any of these enquires. Instead, say you'll phone back and that way you can find out if a legitimate enquiry from your bank."
People are clearly worried about fraud, with a customer survey by SafeNet revealing that 75 per cent of consumers are concerned about buying presents online this Christmas. Anyone who fears they may be at risk as a result of HMRC losing their information should be extra vigilant in tracking any activity with their bank account.
Kevin Mountford, head of savings and current accounts at price comparison site moneysupermarket.com, said: "Everyone must take immediate action to take stock of their finances. There are 25 million people in imminent danger of identity theft and financial losses.
"The person in possession of these discs has names, addresses, dates of birth, National Insurance numbers and bank account details - everything needed to conduct a massive fraud.
"This is an unacceptable breach - probably the most serious one in British banking history. It has put identities, finances and lives at risk."
Mountford recommends people regularly check their accounts online, request mini-statements at ATMs and study their monthly statements. If anyone sees even the smallest irregularity, they should report it immediately to their bank.
He added: "Everyone must be on their guard. The seriousness of this cannot be underestimated."
Companies should also do what they can to ensure staff are aware of internet safety measures, especially in the run-up to Christmas.
Standard Life, for example, is running a computer security week from Monday, organised before the HMRC error.
Standard Life group information security manager Angela Kjolseth, who is part of the Scottish Electronic Crime Forum - which also includes members from HBOS, Aegon UK and RBS - has advice for people planning to shop online for presents.
She said: "We can protect you while you are using computers at work through the use of firewalls and blocking spam messages, but you may be more vulnerable at home as you won't have the same level of IT support.
"The use of scam e-mails is a common tactic. The most common are known as 'phishing' e-mails. These may appear to come from your bank and ask you to 'update' personal information, such as your security password. But you should never respond to these."
People should also check whether the site they want to use takes security seriously. Some work with the Office of Fair Trading and the Trading Standards Institute to promote transparency and safety.
One such site is
www.twenga.co.uk a shopping search engine which launched in the UK last month to help people find bargains.
While people should not miss out on making savings online, they should take all the steps they can to protect themselves against fraud. It would be wise to have a look at the tips produced to protect yourself from identity fraud available from the British Bankers' Association.
