DALLAS, Nov. 20, 2019 /PRNewswire/ -- GIACT Systems®, the leader in the positive identification and authentication of customers, today announced the release of a new white paper, The Hidden Costs of Synthetic Identity Fraud. Due to the availability of customer data from large-scale data breaches in recent years, GIACT's latest white paper highlights the emerging threats that synthetic identify fraud (SIF) poses to businesses and consumers. According to the white paper, new SIF tactics are being deployed across a variety of financial products and industries, widening the risk of infiltration and fallout.
SIF schemes create identities out of real and fake personally identifiable information (PII). These schemes can be difficult to detect as they combine valid information with fictitious, yet established, e-mail and social media accounts, for example. For businesses that rely on static PII as a fraud stopgap, SIF accounts can be extremely difficult to spot and interdict.
In the U.S., which has had more than 446 million consumer records exposed in data breaches in 2018 alone, an increase of 126% of exposed customer data compared to 2017, businesses and consumers are particularly vulnerable.1 Already, according to the Federal Reserve, the credit card industry lost $6B in SIF attacks in 2016 alone.2 With time, as cybercriminals develop and deploy synthetic identities across financial products and industries, SIF-related losses will significantly increase.
"The problem with synthetic identity fraud is that it's not just a 'grab-and-go' job – cybercriminals will build synthetic identities and foster them patiently over time to build credit. Once a certain credit threshold is reached, they strike – leaving businesses in the lurch," says David Barnhardt, Chief Experience Officer, GIACT. "The attitude that businesses need to adopt on identity is one of ongoing, proactive monitoring. Relying on enrollment or biographical data alone to stop bad actors isn't enough. Ongoing identity management – which includes the use of traditional and non-traditional data – throughout the lifecycle of the account is required to validate identity."
In addition to detailing the SIF threats, the white paper also explores best practices to prevent SIF attacks.
"Businesses need to take identity seriously, throughout the customer lifecycle and as change events occur, if synthetic identities are to be stopped," said Kyle Marchini, Senior Analyst, Fraud Management at Javelin Strategy & Research. "Today, synthetic identities are hiding in plain sight. They're a recipe for disaster."
To download The Hidden Costs of Synthetic Identity Fraud white paper, click here.
GIACT® has been helping companies verify valued customers since 2004. From financial to insurance, to retail, to solutions for your industry, GIACT offers customer intelligence for complete payment confidence. As the leader in providing real-time data to help companies mitigate payment risk and fraud, our OFAC screening, ID verification, account verification and authentication, and mobile verification solutions enable you to focus on providing unmatched customer experiences. Since our founding, we've processed billions of transactions for our more than 1,000 customers. For more information, visit www.giact.com or call 1-866-918-2409. Follow us on LinkedIn and Twitter.
1. The ID Theft Resource Center, "2018 End-Of-Year Data Breach Report," January 2019.
2. McKinsey & Company, "Fighting back against synthetic identity fraud," January 2019.