According to the Federal Trade Commission, synthetic identity theft now accounts for 80 to 85 percent of all identity theft in the USA.
It’s a new type of identity theft that’s tough to catch because it might not show up on your credit report and experts say synthetic identity theft is the fasting-growing form of identity theft.
US Congress recently passed a new law that will make it easier for banks and credit card companies to verify Social Security numbers with the Social Security Administration, which should combat a lot of identity theft. However, the law doesn’t take effect until next summer, and even then, it’s only a pilot program.
Weisman says synthetic identity theft occurs when a scammer cherry-picks multiple pieces of stolen information from several victims to create a brand new identity. The scammers then use that new identity to take out loans and open credit cards that they’ll never pay off.
Weisman says synthetic identity theft is tough to catch, because victims are rarely notified.
“There are sub-files within your credit report, so if your Social Security number was used, but not your name, the harmful information will come back into a sub-file for you, but you won’t see that when you look at your credit report,” explains Weisman.
But there is a bit of good news. Weisman says synthetic identity theft is not as devastating as traditional identity theft.
“It’s going to be a pain in the neck for you, you will need to fix this, but you’ll be able to fix it readily, because it becomes quite apparent when it’s not your name but it is your Social Security number or other information that it’s not you,” says Weisman.
He adds, “It is the banks that are really taking the hit more than anyone else on this.”
Still, Weisman says you should be extremely cautious when sharing sensitive information like Social Security numbers. He warns children are often prime targets. “The most effective is taking a child’s Social Security number, because they, you know, they’re not going to have a report, most likely, and it’s going to be years possibly before they find out,” says Weisman.
Source: Turn to 10 Press Release