CHICAGO--(BUSINESS WIRE)--The Federal Reserve today released a Synthetic Identity Fraud Mitigation Toolkit to provide financial institutions, consumers and businesses with an online repository of insights and resources on synthetic identity fraud.
“Synthetic identity fraud, where fraudsters create an identity out of pieces of real and/or fictitious information, continues to grow and resulted in an estimated $20 billion in losses for U.S. financial institutions in 2020,” said Jim Cunha, executive vice president, Federal Reserve Bank of Boston. “Following years of research and collaboration with fraud experts, the Fed is taking the next step to support the payments industry in its battle against synthetic identity fraud by developing this toolkit.”
The toolkit is designed to increase awareness about this type of fraud, enable the payments industry to better identify and fight it, and foster payments industry collaboration to improve synthetic identity fraud mitigation.
The initial release of the toolkit includes downloadable resources that focus on the following:
- Synthetic Identity Fraud: The Basics – explains what synthetic identity fraud is, why you should care, and why fraudsters commit this type of fraud.
- How Synthetic Identities are Used – describes what is hiding in your portfolio and how fraudsters use synthetics to commit fraud and increase their payouts.
- When Synthetics Become a Reality – additional information on common synthetic use cases.
- Detecting a Synthetic Identity – provides tools to help colleagues and consumers identify and prevent synthetic identity fraud.
The second release of the toolkit later this year will expand on the insights and resources in the toolkit’s initial release with next-level strategies for validating identities and detecting suspected synthetic identity fraud.
About the Federal Reserve and Payments
As the U.S. central bank, the Federal Reserve System provides payment services and seeks to foster the stability, integrity and efficiency of the nation’s monetary, financial and payment systems. In 2013, the Federal Reserve initiated a broadly collaborative effort to achieve ubiquitous, nationwide access to safe and efficient faster payments in the United States. The Federal Reserve now collaborates with industry stakeholders to advance five desired outcomes outlined in the 2015 Strategies for Improving the U.S. Payment System paper: speed, security, efficiency, international payments, and collaboration. For more information, visit FedPaymentsImprovement.org.
The synthetic identity fraud mitigation toolkit was developed by the Federal Reserve to help educate the industry about synthetic identity fraud and outline potential ways to help detect and mitigate this fraud type. Insights for this toolkit were provided through interviews with industry experts, publicly available research, and team member expertise. This toolkit is not intended to result in any regulatory or reporting requirements, imply any liabilities for fraud loss, or confer any legal status, legal definitions, or legal rights or responsibilities. While use of this toolkit throughout the industry is encouraged, utilization of the toolkit is voluntary at the discretion of each individual entity. Absent written consent, this toolkit may not be used in a manner that suggests the Federal Reserve endorses a third-party product or service.