Are criminals assembling a “Frankenstein” identity with pieces of your personal information?
Synthetic identity fraud is the fastest-growing type of financial crime in the United States, according to a report from the Federal Reserve. Synthetic ID fraud happens when a fraudster combines both real and fake information to create a fake identity.
For example, a criminal may piece together a stolen Social Security number with a fake name, birth date and address to create what some call a “Frankenstein ID,” according to major credit bureau Experian. Then the fraudster uses the new, fake identity to take out loans, apply for credit cards or receive government benefits.
Synthetic ID fraud can also be used for criminal activities such as escaping detection, stealing funds and drug and human trafficking, according to the Federal Reserve report. Meanwhile, you have no idea that parts of your personal information were used to create a new fake identity to be used for nefarious purposes.
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How synthetic identity fraud happens
Synthetic identity fraud can happen in a variety of ways, according to Experian. Someone may steal your personal information. Criminals might buy your Social Security number or other personal information on the dark web. A fraudster may even use just one Social Security number to build several fake identities.
Sometimes, criminals play a waiting game, building a solid credit history for the new identity for months or years before putting their identity fraud plan into action. Once credit is established, the fraudster borrows a bunch of money and vanishes with the funds.
Even consumers just trying to rebuild their credit with a credit repair company can become innocent victims of synthetic ID fraud. Shady credit repair companies may try to sell you a “credit privacy number“(CPN) as a way to conceal a bad credit history or bankruptcy. The number is formatted like a Social Security number, and the company selling it may tell you that the CPN can be used in place of your Social Security number when applying for credit.
In reality, CPN marketers are scammers that often obtain and sell – sometimes for thousands of dollars – the Social Security numbers of children, senior citizens, prison inmates and others, according to Experian. So, when someone uses the CPN to apply for credit, the applicant unwittingly commits identity theft.
Find out: 5 Signs You May Be a Victim of Identity Theft
Tips for protecting yourself from synthetic ID fraud
The only thing scarier than a monster stitched together by a mad scientist is a fake identity based on pieces of your personal information lurching its way through credit applications.
Here are four tips from Experian for how to avoid becoming a synthetic ID fraud victim…
1. Monitor your credit report
You can order one free copy of your credit report a week from AnnualCreditReport.com through April 20, 2022. Review your credit report regularly, watching for unfamiliar accounts or inaccuracies on your name, address and other information.
Find out: What is Credit Monitoring and How Does It Work?
2. Freeze your and your children’s credit reports
When you lock or freeze your credit report, that keeps others from being able to open an account in your name. You can do the same for your child, so no one can fraudulently use his or her identity (or parts of it) to fraudulently obtain credit.
When you lock your credit, you can activate or disable it with an app on your phone or through a secure website. If you want to “unfreeze” your credit, you must contact each credit reporting agency where you placed the credit freeze.
To freeze or lock your credit, visit Experian, Equifax and TransUnion for details.
Find out: How to Place a Credit Freeze
3. Use caution on social media
Do you have your birthday listed on your Facebook profile? You should probably remove that information since fraudsters could use your birth date as part of a fake “Frankenstein ID” to apply for credit. Also, leave off your address or any other information that fraudsters can use to piece together a fake identity.
Find out: What is Social Media Identity Theft and How Do You Prevent It?
4. Don’t ignore unexpected mail
Don’t simply assume that an unopened letter from a local government office or credit card company is junk mail and toss it into the trash. That letter could be about an unemployment claim fraudulently filed under your name or a pre-approved credit card offer for your three-year-old daughter. Those letters could be the first sign that a Frankenstein ID is being used for identity fraud.
Published by Debt.com, LLC