What is synthetic ID theft?
Synthetic ID theft occurs when a criminal combines both valid and falsified information to create a new identity. Synthetic ID theft falls under two categories: manipulated synthetic, when the thief makes slight changes to a real identity or manufactured synthetic when the thief pieces together valid information from multiple sources. They might pair a real social security number with a false address, for instance, or pair one person’s social security number with another person’s name.
The Government Accountability Office identifies three primary motivations behind synthetic ID theft: nefarious activity, residency and credit repair. Crooks use stolen and synthetic identities to take out loans and open new accounts, secure a job without the right to work or ride on the coattails of a good credit score. Synthetic ID theft is harder to catch than outright falsification— because some of the information is real, it’s less likely to be flagged by detection systems. It’s so effective, in fact, that the Federal Trade Commission has deemed it the most common type of ID fraud.
Who is at risk for synthetic ID theft?
Unfortunately, children are the most common victims of synthetic ID theft. A child’s non-existent credit history gives thieves a clean slate to apply for credit cards and take out loans. Because parents are unlikely to monitor their child’s credit, fraudulent activity can go on for years without detection. Fraudsters know this all too well— 0-7-year-olds account for 66% of all child synthetic identity theft. The younger the child, the longer their identity can be compromised. The child won’t know their identity was stolen until they apply for their first credit card or first loan. When their information is reviewed, they’re in for a nasty shock when they discover that their credit has already been ruined.
The elderly and the homeless are also more vulnerable to synthetic ID theft. Because their Social Security numbers are somewhat inactive, it’s unlikely that they’ll notice suspicious activity under their name. In some cases, thieves will even steal Social Security numbers from the deceased in an attempt to remain completely undetected. Realistically, however, anyone is at risk for synthetic ID theft. If you’ve given out your bank information, address, or Social Security number, thieves may be able to access it.
What can I do to protect myself and my family?
Luckily, there are plenty of things you can do to protect yourself and your loved ones from synthetic ID theft. Minimize your risk through the following steps:
- Don’t provide unnecessary information. If asked to provide your Social Security number on a form, ask why it’s needed and what it will be used for. If the person or organization in question fails to provide a clear answer, don’t add your SSN. Trust your instincts— it’s always better to err on the side of caution.
- Monitor your credit history closely. Be sure to monitor your credit history regularly. Do you recognize every transaction? Is your credit score what it should be? Call your creditor or your bank immediately if you notice something suspicious.
- Review your annual Social Security statement. Cross-reference your annual report with pay stubs to ensure an accurate salary. In some cases, income the crook receives under your SSN will appear.
- Freeze your child’s credit. The best way to ensure your child’s credit history remains clean and untainted is to freeze it until they reach legal age. Not all states allow you to freeze your child’s credit— make sure your state is on the list.
- Shred or delete old documents that contain personal information. If you have old forms lying around, it’s time to get rid of them. Do a thorough sweep of your home and your computer and destroy anything that’s no longer needed.
- Keep your personal documents secure. Though the vast majority of synthetic ID theft is digital, physical copies of identification documents are sometimes used. Store your birth certificate, social security card, passport, and the like in a lockbox or safe.