Synthetic identity fraud costs credit issuers

Synthetic identity fraud is costly to the credit union industry, which is susceptible to the trend to manufacture identities. These fraudulent accounts are set up by blending a person’s actual information, such as a real social security number, with fake details, including names and addresses. The use of these imaginary identities is causing more credit […]

Synthetic identity fraud is costly to the credit union industry, which is susceptible to the trend to manufacture identities. These fraudulent accounts are set up by blending a person’s actual information, such as a real social security number, with fake details, including names and addresses. The use of these imaginary identities is causing more credit card losses than ever even though the rate of growth of this type of fraud is slowing.

American Banker says according to an analysis of card transactions TransUnion released this week, “Outstanding suspected synthetic fraud balances rose 5.2 percent between the fourth quarter of 2016, when it was $276 million, and the fourth quarter of 2017, when it was $290 million, according to the credit bureau’s analysis. During the previous year, such balances rose 68.5 percent.”

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The League of Southeastern Credit Unions & Affiliates represents 342 credit unions in Alabama, Florida and Georgia, with a combined total of $118.63 billion in assets and more than 10.1 million members. LSCU & Affiliates provides legislative and regulatory advocacy; education and training; cooperative initiatives (including financial education outreach); public messaging; information services; and business solutions.

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