Data Breaches power massive Synthetic Identity Fraud

October 20, 2021 – New research from FiVerity quantifies the major impact and costs data breaches have on financial institutions.  The past three years have been a hacking goldmine, yielding 3.4 Billion personally identifiable identity (PII) elements, such as social security number, address, phone numbers, etc that fraudsters can use to create a “Synthetic Identity”.  Once they have a piece of a real person’s PII, they can combine it with fake data and then implant it on a high quality fake ID document (such as a driver license) for as little as $20.  With the ID in hand, patient fraudsters will then create fake bank accounts and cultivate the accounts for many months, building the credit score, ultimately “busting out” with a large loan they never intend to pay off, sticking the bank with the bill.   

FiVerity’s report found that financial institutions using only legacy identity verification systems (such as database / credit checks) are missing between 85% and 95% of likely synthetic identity fraud that exists in their books, lying in wait.  Fraudsters can take as long as 18 months to build up their credit before they strike and that the average synthetic identity fraudster successfully steals between $81,000-$97,000.