You may have heard about identity fraud – when a scammer essentially steals the identity of someone else. The so-called synthetic identity fraud is a more devious and technologically advanced take on that formula.
It involves scammers using parts of a person’s real identity, combined with made-up information to create fake or synthetic identities they can use to open accounts, apply for credit cards, and much more, before vanishing without a trace when banks come to chase them down.
Scam Detectors Most Trusted Websites in Online Security
- Guard.io (100): Do you want to surf the web safely? Just add Guardio and block phishing for good!
- Incogni.com (100): Delete your personal data from the internet and protect against scams and identity theft.
- ExpressVPN (100) Stay secure and anonymous online - Best VPN Out There
How Does Synthetic Identity Fraud Work?
The foundations of every synthetic identity fraud scam are the identities themselves. To make them, fraudsters take bits of real information – like real people’s Social Security numbers – and then combine them with other bits of false information. They could use a real Social Security number but pair it with an address, name, and date of birth they made up on their own.
Then, with their identity established, they typically start applying for lines of credit with different banks and providers. Even if their early applications are rejected, each one essentially adds to the authenticity of the fake identity and gradually grows its credit file. Eventually, a bank or lender (often a high-risk lender) will approve them.
They can then nurture that initial credit and use it properly, paying off whatever they owe on time to improve their credit score. That then opens up more opportunities for them to successfully apply for loans and credit cards with other banks, accessing much more money that they can max out before they vanish, leaving the bank chasing a “ghost” person.
There are several reasons these forms of fraud often prove effective. Firstly, the scammers often take real info from people who aren’t that likely to find out, like children or older people. Additionally, they do all they can to make their fake IDs look real – they make social media profiles and fake business websites, and partner with other scammers to help with their burgeoning credit scores.
As for the effects of this fraud, they can be devastating to both institutions and individuals. The banks and lenders that approve payments to fraudulent identities can lose huge amounts when they inevitably cash out. Meanwhile, those whose identities were stolen may struggle with knock-on effects on their own credit history and complex legal procedures to prove their innocence.
How to Protect Yourself From Synthetic Identity Fraud
- Keep your personal information safe and closely guarded. Don’t give away crucial pieces of data, like your Social Security number to people or businesses you don’t know.
- Shred or otherwise destroy documents you don’t need that have your personal information on. Don’t just toss them out.
- Keep a close and regular eye on your credit reports so you can spot any unauthorized activity or signs of credit use you don’t recognize.
- Educate yourself on phishing scams and other underhand tricks that scammers may employ to steal your data.
Report the Scam
If you think you have been a victim of synthetic identity fraud, you can report it in various ways:
- Report to the FTC.
- Report to the FBI Internet Complaints Center.
- Contact banks and lenders who were used as part of the fraud and let them know what happened. Contacting the major credit bureaus (Experian, TransUnion, and Equifax) is also recommended.
How to Protect Yourself More
Subscribe to Scam Detectors’ scam alerts to learn about new scams and threats as they emerge.
You’ll also receive regular emails from the Scam Detector team to let you know about how to stay safe online, how to protect your data, and what red flags to watch for.
Read up about other identity theft methods to learn more about other ways in which scammers could try to steal your data.
Verify Another website
Are you just about to make a purchase online? See if the website is legit with our validator:
vldtr®
TOP 4 MUST-WATCH FRAUD PREVENTION VIDEOS
1. Top 5 Amazon Scams in 2024 2. Top 5 PayPal Scams in 2024 3. How To Spot a Scam Email in 2024
When my sweet old grandmother got caught up in an Amazon gift card scam, I decided then and there that I needed to do whatever I could to inform as many people as possible about the grifters of the world. That’s what I do here – writing about modern scams so you don’t get caught out.
Hello and ive been easily hacked for the past 5 years. Nomatter the new phone, new number,new email etc…. i still get hacked 5 minutes after my new phone is activated before i even make my 1st call its hacked. I dont understamd how they do this!!!!ive had money taken time and time again. I found loans on my credit reports that are not mine but have been either paid on time or even paid off. I do not know where to start with getting my online life back. I get fraud alerts like crazy that evem say my info was sold on the dark web. Ive gotten fake bills,even paid fake house payments,almost lost my home,now i get things like disclaimers on evetything i do that þalk about me having a buisness “when i dont” or me owing taxes and how i should always pay them ontime or atleast pay them ” when i do not” along wirh many other things im acused of. It keeps me very upset
I want my life back but dont know where to begin oh even google has now acused me of infringememt and tort
WHAT??? I Never have even heard of tort but know now. I hate the internet and wish we didnt depemd on it. Thank you for doing this for making this website!!!!