Officials to “Keep Up“ With Synthetic Identity Fraud

According to reports from the U.S. Attorney’s Office for the Northern District of Georgia, cases involving “synthetic identities” are among the fastest growing forms of identity fraud in the United States. U. S. Attorney John Horn announced that the Attorney’s Office will keep up, or at least remain current, with the fraud. While reports of synthetic identity use date back to 2013, the numbers in 2016 and 2017 dwarf those from previous years.

Unlike identity theft, synthetic identities are an “unfortunate new form of criminal fraud” that utilize fake Social Security numbers to create fake identities. These fake identities come from using the fake Social Security numbers to build credit history through credit reporting agencies. The fake Social Security numbers, in the end, result in a fake identity with good credit history. Criminals use the credit history to open credit cards under the fake identity. Those credit cards, linked to a fictitious name, collect hundreds of thousands of dollars in debt.

One recent case involved a recently sentenced man that used synthetic identities in a massive credit card fraud scheme. Kelvin Lyles, the defendant in the case, created fake identities using the aforementioned method. He then opened credit cards with a high spending limit and charged over $350,000 to his fake identities’ credit cards. Via websites and online markets that he owned or operated, Lyles spent money with the fake cards and deposited the fraudulent income into his personal accounts.

“As synthetic identity theft continues to become one of the fastest-growing consumer fraud schemes, the US Postal Inspection Service will remain steadfast to investigate emerging criminal trends to bring these offenders to justice,” U.S. Postal Inspector in Charge of the Charlotte Division, David M. McGinnis said. “Postal Inspectors will continue to go after those who utilize the U.S. mail for fraudulent financial gain.”

In December 2015, Lyles’s scheme concluded when law enforcement raided his home. Officers found over 300 synthetic identities. They also found everything required for now the full fake identity kits: driver’s licenses, social security cards with a matching fake number, and a significant quantity of matching credit cards. Investigators determined that the man attempted to steal $435,862.10 but, according to credit card bills, only successfully stole $350,000.

In 2017, Lyles pleaded guilty to the fraud. U.S. District Judge Mark H. Cohen sentenced the man to three years in prison and three years of supervised release. The judge also called for restitution in an amount that matched the amount of money Lyles stole. The USPIS, a law enforcement agency becoming the mainstay of cybercrime and fraud related press releases, investigated the case.