Synthetic identity theft is a type of theft where criminals combine real personal information, like a social security number, with fabricated details to create a new, fake identity. While the idea of a Frankenstein-like monster may seem like a topic for a horror novel, you may be surprised to find that mashing up different parts of a person is something that happens – just not in the way you may assume. Known as synthetic identity theft, this crime is even more complicated and difficult to detect than traditional forms of identity theft. As such, the following blog explores what you should know about these matters, including the importance of working with a Michigan identity theft lawyer.

What Is Synthetic Identity Theft?

When someone steals your identity, they typically usurp your details, including your name, date of birth, social security information, and address. However, a new form of identity theft has emerged that can make it even more challenging to discover that your information has been compromised.

Synthetic identity theft occurs when thieves take the real information of individuals and add fake details to create an entirely new identity. For example, a thief may take your social security number and assign it to a made-up person with a fake name, date of birth, and address. They will then use this information to commit fraud, such as applying for loans, taking out credit cards, and even obtaining government benefits. Often, this type of fraud impacts those most at risk, including senior citizens, children, and incarcerated individuals.

Synthetic identity theft is one of the fastest-growing forms of fraud in the United States, as it typically involves credit fraud, identity fraud, and Social Security number misuse. As this can appear legitimate to lenders and creditors, it can go unnoticed, leading to long-term financial damage.

Key Characteristics of Synthetic Identity Theft

  • Combines real information like Social Security Numbers, with made-up personal details
  • Creates a new “person” rather than impersonating an existing one
  • Often goes undetected for months or years
  • Commonly used to:
    • Open credit accounts
    • Build fraudulent credit histories
    • Secure loans and benefits
  • Often targets:
    • Children (often have unused Social Security numbers)
    • Elderly individuals
    • Incarcerated individuals
    • Military members

Why Synthetic Identity Theft is Hard to Detect

  • Credit bureaus can treat identity theft as a new file rather than fraud
  • Victims may not notice activity tied to their Social Security Number
  • Thieves can gradually build seemingly legitimate credit profiles
  • Traditional fraud alerts may not be immediately triggered

How Synthetic Identity Theft Typically Works

  • A fraudster obtains a real Social Security number, often belonging to a child or vulnerable individual
  • They combine it with a fake name, date of birth, and address
  • The fraudster will apply for credit using synthetic identity theft
  • Initial applications can be denied, but a credit file will be established
  • Over time, the thief will build credit with smaller accounts
  • Once the identity appears legitimate, they will begin to open larger accounts
  • They will eventually “burst” by maxing out their credit before abandoning the identity

What Justice Can  Seek if I’m a Victim?

Unfortunately, finding the perpetrators of identity theft can be incredibly difficult due to the ability of perpetrators to cover their tracks. However, this does not mean you cannot seek compensation and justice for the damages you’ve suffered.

For example, if your information is compromised because a company storing your data failed to update security measures, they can face liability. If you can locate the thief, like a friend or family member, they can be held accountable in a court of law, facing both civil and criminal lawsuits.

Legal Options Available to Victims

  • File credit report disputes under the Fair Credit Reporting Act (FCRA)
  • Pursue claims against:
    • Credit bureaus for reporting inaccurate information
    • Creditors that fail to investigate disputes
    • Companies responsible for data breaches
  • Recover damages:
    • Financial losses
    • Emotional distress
    • Statutory damages in accordance with federal law
  • Work with a consumer protection attorney to:
    • Remove fraudulent accounts from your account
    • Restore your credit profile

What Can I Do to Prevent This?

If you are worried about becoming a victim of synthetic identity theft, it’s imperative to take the necessary steps to protect yourself and mitigate the potential of this occurring. Generally, the most important thing you can do is protect your Social Security number. Unfortunately, if this falls into the wrong hands, the impact can be devastating. As such, you should never provide this number to anyone over the phone unless you have initiated the call. Additionally, you should never carry your Social Security card with you. Instead, store it in a safe location like an at-home lockbox.

You should also limit how much personal information you share online. Though including your birthday or old addresses may seem harmless, it can be used to create a fake identity.

Finally, you should stay up to date with phishing attempts. Understanding the most common scams and schemes can help you stay alert to fraudulent texts or emails.

Practical Steps to Protect Yourself

  • Monitor your credit by checking your free credit report every few months
  • Place a credit freeze to prevent unauthorized credit accounts
  • Utilize two-factor authentication on financial accounts to protect your information
  • Avoid sharing personal information:
    • Social media
    • Public databases
  • Check financial statements on a regular basis
  • Shred documents that contain sensitive information when disposing of papers

What Should You Do if You Suspect Synthetic Identity Theft?

If you believe your information has been used to create a synthetic identity, taking immediate action can help you limit the damage and rebuild your financial standing.

Immediate Steps to Take

  • File a report with the Federal Trade Commission (FTC)
  • Contact each of the three major credit bureaus (Equifax, TransUnion, and Experian)
  • Place a fraud alert on your credit freeze, depending on your credit needs
  • Submit a written fraud dispute
  • Keep records of all communications with the reporting bureaus

Contact an Experienced Michigan Consumer Defense Attorney

As you can see, synthetic identity theft can destroy your credit and make it incredibly difficult to reclaim your identity. If you believe you are a victim of fraud, it’s in your best interest to work with an experienced consumer defense attorney with Lyngklip & Associates. Our team understands how difficult these matters can be, which is why we will do everything possible to assist you during these challenging times. When you need help, our firm is here. Contact us today to learn how we can help you.