You probably know someone who’s had their identity stolen. You may have even been a victim yourself. But what happens when fraudsters steal bits and pieces of identities and then create an identity for a person who doesn’t exist? And use that synthetic identity to acquire wireless service, establish an account for electricity, turn on cable TV service, and then walk away without paying the bills? It may seem rather complicated, but the pay-off makes it one of the fastest growing fraud schemes.
Data breaches provide fraudsters with a steady stream of information necessary to build synthetic IDs, including breaches that exposed the personal data from 22 million government workers, 36.3 million consumer retail accounts, and 91 million health insurance company customers.
As overwhelming as these numbers may seem, the solution is to fight all this stolen data with more data. Fast, reliable, identity-verification solutions that check the information on new account applications against multiple sets of public and proprietary data can identify a false identity before it’s approved.
To detect synthetic identities, multiple databases check that:
- The applicant’s social security number is valid and only matches the applicant
- The address is a real residence and no suspicious activities are associated with it
- The applicant has a utility account, receives a bill and pays it
- The applicant has a record of employment with a real company and files income tax returns
By including verified non-public data, telecommunications and utility providers can identify up to 99% of their population. They can also detect suspicious patterns by using analytics-based solutions to help determine if the applicant is a real person. Companies that use these analytic capabilities experience a 25% reduction in false positive rates as a result of quick and confident decisions to either flag an applicant for further screening or approve them to continue in the process.
The key to fighting synthetic ID fraud effectively is having access to verified data. Access to millions of public and proprietary files – when combined with analytics, technology and expertise – will help you stay ahead of fraudsters and every new twist in their ongoing schemes.