Synthetic Identity Fraud
Synthetic Identity Fraud
Synthetic identity fraud involves using combinations of real and phony attributes, such as email, phone, and address–including possible real attributes that don’t correlate to each other–in order to assemble a new identity. The bad actor may even keep a very real and legitimate credit history for a time, then at some point max out credit lines or cards.
How does synthetic identity fraud work?
After the perpetrator opens an account using the synthetic identity, they typically build up a decent credit score, open multiple accounts, and often appear to be good customers while going undetected until they decide to cash in, or “bust out” where they use up all available credit lines and disappear.
What do fraudsters use a synthetic ID for?
Synthetic IDs are most often used to defraud financial institutions, fintechs, government agencies, and other enterprises.
What makes synthetic identity fraud different from other types of identity fraud?
Unlike other types of fraud where bad actors exploit legitimate identities, synthetic fraud involves the creation of fabricated identities to establish accounts and lines of credit. Synthetic identities are usually established over time–months or even years–to extract maximum financial reward, whereas traditional identity fraud involves the use of a victim’s identity for a quick ‘smash and grab’ scheme.
How do you prevent synthetic identity fraud?
The best defense comes from a purpose-built synthetic fraud detection solution like Socure’s Sigma Identity Fraud, which pinpoints synthetic fraud patterns to accurately identify risk within milliseconds.
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