Figures for UK identity fraud published yesterday by the Home Office were overstated by hundreds of millions of pounds, according to the Association for Payment Clearing Services (Apacs).

The government estimated that identity fraud cost UK consumers £1.7bn last year. But Apacs pointed out that the Home Office had assumed that the Apacs figure for all card fraud (£503m) was the same as that for identity theft (£36.9m).

"We would never use the £503m figure for pure identity fraud. We would put the figure at £36.9m," said Sandra Quinn, director of corporate communications at Apacs. "The Home Office included the figures for all card fraud. We define identity theft differently."

In addition it appears that the figure of £395m lost to money laundering is an estimate since no official figures are available, although this has yet to be confirmed by the Home Office.

Home Office minister Andy Burnham was quick to use the figures yesterday as a way to promote a national identity card. However, once the corrections have been taken into account the amount lost to identity fraud would be £1.2bn, down from £1.3bn in 2002.