Synthetic Identity Fraud

Synthetic identity theft is one of the fastest growing and more insidious forms of fraud because it creates entirely new identities using stolen personal information such as Social Security numbers. It’s also one of the more difficult to detect, so it can go undiscovered for years. Thieves steal a Social Security number and combine it with a fake identity to create fraudulent accounts.

How it Works

Fraudsters can use a stolen Social Security number to establish a new credit history, using a fictitious name, address and birth date. To establish credit, so that fraudsters can open up a fraudulent account, they create a record of a fictitious person by adding that person to a legitimate account as an authorized user. Over time a credit history and score emerge for the fictitious person.

It could take several years for the fraudster to build the credit score of the fictitious person to qualify for a separate credit card account. It could take another couple of years to build the credit score even more to earn higher credit limits. When the credit limit is high enough, the fraudster goes out and maxes out the card before abandoning the identity.

Children are a favorite target of synthetic identity thieves because parents don’t think to check their credit reports until they are close to applying for credit. In that time frame, fraudsters could repeatedly use a child’s social security number to create numerous fake identities.

How to Protect Your Child and Yourself from Synthetic Identity Fraud

Sign up for credit monitoring on your own credit. A credit monitoring service will notify you if your personal information has been used to open a new account.

Never provide your Social Security account online, unless you know for a fact the request is legitimate.

Check your child’s credit report annually. A record of your child’s credit shouldn’t register on credit bureaus databases, so if it ever does, it’s a red flag.

Never give out your child’s Social Security number. If someone does require it, find out the reason why and how it will be used.

Freeze your child’s credit. You may have to establish a credit record for your child to be able to freeze it. But it may be worthwhile to protect your child from identity theft.

About This Author


Ross Bentzler

Ross Bentzler is Executive VP and Information Security Officer for Alpine Bank. Ross has worked in the information technology field for two decades, focusing on information security for 13 years.

More about Ross Bentzler

Allpoint It’s your money after all. Find a surcharge-free ATM