Synthetic identity fraud is the method of fraudsters creating completely new identities by fusing false information with real data, as opposed to stealing a real person’s entire identity.Since synthetic identities don’t belong to anyone, they are more difficult to identify using conventional verification techniques than stolen identity fraud, in which cyber criminals pose as real people.In order to get past identity verification checks for online platforms, cyber criminals fabricate and utilize fake identities. These sneaky identities are frequently used for loan applications and bank account creation.First, real personal data is obtained by cybercriminals through data breaches, purchases made on the dark web, or deception of customers through social engineering into divulging personal information.They then create a new identity by combining fake and real data. Cybercriminals then submit credit applications. They start building a good credit history by making small purchases and timely payments of the minimum balance. Next, use all of credit and cease making payments.The best defense against fake identities is AI-powered verification that uses biometrics, liveness detection, and NFC chip checks.
