Although I have been writing about synthetic identity theft for many years, many people are not familiar with the term “synthetic Identity theft.”  Synthetic identity theft poses a significant threat to many people particularly children.  Synthetic identity theft occurs when a criminal takes information from a variety of sources to create a new identity to take out loans, purchase goods and services, or fraudulently obtain credit cards.  Synthetic identity thieves combine real and fake information to form a new fictional person.  They may use your Social Security number and combine it with the name, address and phone number of someone else.  The Federal Trade Commission (FTC) has said that synthetic identity theft is the fastest growing type of identity theft.  Children are the most common victims of synthetic identity theft and it is often many years before the problem is discovered.

The problem of synthetic identity theft has gotten worse in recent years with as much as 85% of identity theft last year being synthetic identity theft which has increased 233% over the last five years.

Commonly with synthetic identity theft, criminals who set up a synthetic identity build the credit score of the synthetic identity by having people using credit cards obtained in the name of the synthetic identity and make regular payments until the credit score of the new synthetic identity is high enough for the ultimate payoff, which is referred to as the “bust out.”  In the bust out phase, the identity thief uses the new synthetic identity to either make large purchases or take out big loans that are never paid back.  Some synthetic identity thieves will take years to build the synthetic identity theft credit score by making payments on cell phone accounts, car loans and more.


Some telltale signs of synthetic identity theft include being contacted about an account that you never opened or a debt that you didn’t incur.  Also, look for aliases listed on your credit report that you do not use.  A dramatic lowering of your credit score coupled with a lack of negative information on your primary credit reports are further indications of synthetic identity theft.  The reason that your primary credit report will not show negative information due to synthetic identity theft is because when a criminal uses your Social Security number, but doesn’t use your name, the negative information caused by their actions does not appear on your regular credit report.  Instead, the information is added to a sub-file of your credit report which will, however, cause your credit score to drop tremendously.

If you do find out that you have become a victim of synthetic identity theft, notify each of the three credit reporting agencies, Equifax, Experian and TransUnion of the crime and ask them to investigate and remove the false information from your sub-files.

Children are prime targets and particularly vulnerable to synthetic identity theft.  Last year 915,000 children in the USA were victims of identity theft, much of it synthetic identity theft. Parents also should, as much as possible, try to limit the places that have their child’s Social Security number and become familiar with the Family Educational Rights Privacy Act which helps you protect the privacy of your child’s school records and enables you to opt out of information sharing by the school with third parties.

You also should freeze the credit reports of your children.  Until 2018 there was no national law that allowed the credit reports of children to be frozen, but in the wake of the major Equifax data breach, Congress passed laws that now permit children’s credit reports to be frozen and unfrozen for free.

Here are the links to information about how to freeze your child’s credit reports at each of the three major credit reporting agencies.

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