“Synthetic identification fraud appears to be one of the fastest-growing type of identity theft and financial crime in the U.S.,” says NAFCU Regulatory Paralegal Shari Pogach. Pogach explains this fraud – and recent charges brought against 11 defendants for defrauding $3 million from banks through the use of fake identities – in a new NAFCU Compliance Blog Post.
Recently, the U.S. Attorney’s Office of the Eastern District of New York brought charges against 11 individuals for defrauding banks “by using fake or ‘synthetic’ identities to get credit cards, running up charges and not repaying the issuing financial institutions. Three of the defendants then laundered the proceeds to conceal the source of the funds,” Pogach writes.
She offers explanations of synthetic identity fraud, which “happens when a criminal creates an identity instead of stealing a real person’s identity, and a bust-out scheme, which “is generally when someone applies for credit … using a synthetic identity,” in addition to detailing the fraudulent activity that led to charges in the Eastern District of New York.
Read Pogach’s full blog post here, which also includes resources on preventing synthetic identity fraud.
Those interested can sign up to receive new NAFCU Compliance Blog posts in their inbox every Monday, Wednesday and Friday by clicking here. The association’s new Compliance, Risk & BSA Network is also a great member-only resource where compliance professionals share insights and information on various issues.
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