The first ID cards have been issued to foreign workers
The national identity card scheme could be "fatally" undermined by cheaply produced fake cards, a leading industry expert has warned.
Toby Stevens, of the Enterprise Privacy Group, believes a shortage of fingerprint scanners could lead to an explosion in "flash and dash" fraud.
And that, he says, could scupper the scheme before it gets off the ground.
The Home Office has said it will set up a hotline for traders concerned about the authenticity of ID cards.
But it has no plans at this stage to issue scanners to shops, banks, pubs and other commercial premises.
And there is currently no timetable for scanners to be handed-out to immigration officers, job centres and police, although the Home Office insists this will happen.
The government is pushing ahead with the controversial ID card scheme, despite vocal opposition from both the Conservatives and the Liberal Democrats, who say they will scrap the £4.7bn project on civil liberties and cost grounds.
A total of 50,000 cards are expected to be issued to foreign nationals by April and the first ID cards will be issued to British citizens later this year, when they are given to airside workers at London City and Manchester airports.
The government then plans to make the cards available to ordinary citizens in the Manchester area, as part of a "beacon" project.
The Home Office estimates that three million people will carry a card by 2010.
But Mr Stevens, who is a leading adviser to the government on ID cards from the business lobby, fears the scheme could be scuppered before it gets off the ground by a black market in fake cards.
He said: "In the early days, private companies won't be aware of what an ID card is supposed to look like, nor will they have the equipment to check the cards electronically, so 'flash and dash' is inevitable.
"For this reason, there is already a black market in fake ID Cards, even though the design for UK nationals has yet to be decided."
National identity cards will contain fingerprints and face biometrics but there is no timetable for the introduction of scanners to authenticate them, meaning staff and officials will have to rely on visual checks.
But Mr Stevens said the biggest fraud threat would not come from criminals enrolling on the ID database with false identities or creating cards linked to cloned identities but from cheaply-produced fake ID cards, which are already available on the internet.
He said: "The government needs to realise that any fraud at all associated with ID cards - even if they are 'fake' ID cards that are not in fact a security failure in the national identity scheme - will create high-profile media headlines and undermine public and commercial confidence in the national identity scheme.
"Once ID cards are universal and pervasive in day-to-day life, the risk of this happening will be reduced, but if not properly managed then confidence could be fatally diminished."
He said the government should ensure the scheme is rolled out as quickly as possible and focus on making the cards as "useful and attractive as possible" to promote uptake and combat fraud.
But a spokesman for the Identity and Passport Service dismissed fears that the cards will be prone to fraud.
He said: "To suggest incremental roll out of ID cards and electronic readers will undermine the security of the scheme and lead to more fraud is wrong.
"We recognise the importance of being able to validate cards. In addition to physical and technical design features of the card to prevent forgeries, we are considering how organisations will be able to check the validity of an identity card that is presented to them using a service similar to the current Passport Validation Service.
"We believe citizens will recognise the benefits of ID cards and they will quickly become seen as the preferred proof of identity by organisations looking to prevent identity fraud."