Fed Warns U.S. Firms Failing To Tackle Synthetic Payment Fraud

Financial institutions in the United States are still failing to grapple with ballooning payment fraud perpetrated by criminals using made-up identities, the Federal Reserve has warned.

In a white paper issued on Tuesday, the regulator instructed firms how to avoid on-boarding customers hiding behind “synthetic identities,” which are typically based on a misappropriated or false social security number.

Those behind the fraud type combine that social security number with a combination of fake or real information, such as social media accounts, and a post office box to receive credit cards. Real social security numbers of the elderly, homeless and even children are used.

Request a Free Trial

As a trusted source of regulatory intelligence for the global payments industry, we enable organisations to manage the growing volume and velocity of regulatory risk with confidence, empowering more informed and effective decision making, in an efficient and cost-effective way.

Take a Trial