Until recently, identity theft involved the criminal getting enough of your personal details to be able to pretend to be you and open accounts in your name, take out loans, credit cards etc.
Now, we have synthetic identity theft, which is where the criminal combines real and fake information to create a new identity. These fake identities are then used to open accounts, make purchases etc. but also apply for unemployment benefit, duplicate accounts etc.
These criminals steal identity information e.g. social security number, passport number, identification cards etc. and couple that with false information such as names, addresses, birth dates etc.
They now have a whole series of synthetic identities to use for criminal purposes.
People who commit synthetic identity fraud may use these fake identities straight away or keep them for weeks or months and build up a track record in each of lawful usage. This makes it easier to use them at a later stage without drawing attention to their lack of transactions and credit history.
It can be difficult for the financial institutions to recognise this as fraud as there may not be any victims e.g. if for example, a criminal uses a stolen social security number but fake name and address.
Synthetic identities are often used by organized crime rings, which set up many such accounts to use for money laundering and dispersion of money to members.
For people caught out in this fraud, it can be difficult to make sense of.
Imagine you contact your bank about your personal account and they ask you which one. It appears you have two personal accounts in your name but with different addresses and other details.
This has happened.