Are You at Risk for Synthetic Identity Theft?

Understand synthetic identity theft before it's too late

If you want to stay safe from identity theft, you must know the facts. As thieves become more tech-savvy, avoiding identity theft becomes more difficult. Synthetic identity theft is just one form of theft. Before you can protect yourself, you must understand it, how to detect it, and how to prevent it.

Synthetic Identity Theft

Synthetic is growing in popularity. ID Analytics reports this type of fraud accounts for 74% of total dollars lost by U.S. businesses. This form of theft involves stealing a social security number and using that number with the name and birthdate of someone else. Basically, the thief is using a real social security number and building a fake or synthetic identity around that number.

How Does Synthetic Identity Work?

Committing synthetic identity theft is easier than you think. First, a thief steals a social security number. This is easier than you think. The different methods thieves use are dumpster diving, getting information off old computers and cell phones, public records, skimming, hacking computer networks, and job resumes.

After the thief uses one of these methods for stealing the social security number, he creates a new person. He might get utilities with that name and social security card or use the social security number on a short-term job.

The thief lies low and let's things stay quiet for a while and then after the identity is somewhat established, gets a small loan which he pays back right away. His next step is to take out a large loan and never pay it back.

Who Cares?

Synthetic identity theft is most harmful to creditors. So why should you care about preventing it? Because, ultimately, it's you that foots the bill for these crimes. When creditors are hurt because of fraud and theft, they pass the costs on to you, the consumer.

Not only are you picking up the costs of identity theft, but also if your social security number is stolen and used like this, creditors could end up coming after you to collect on the debts. This ruins your credit and your reputation.

Synthetic Identity Theft -- Hard to Detect -- Hard to Stop

The problem with synthetic identity theft, other than the obvious ones, is that it is hard to detect. And if you can't detect it, you can't stop it. Detecting this type of fraud is hard because it doesn't show up on credit reports. Instead, the credit bureaus set up a completely new file.

To avoid identity theft, follow safe practices when it comes to your personal information. At home, keep important papers locked up. Shred all papers with information before throwing them away. Clean old computers, copiers, and cell phones before donating or throwing them away. Stop your mail when going out of town.

Detecting synthetic identity theft is difficult. Get a free credit report yearly from all three major credit agencies. Have them check for your name with a different social security number and ask them to run a report using just your social security number. Be diligent and follow these tips to protect yourself from synthetic identity theft.

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