Report Finds Synthetic ID Fraud Doubled in 2021

Report Finds Synthetic ID Fraud Doubled in 2021

July 21, 2022

A new report covering a wide range of payment and fraud data found synthetic identity fraud, gift card fraud and account takeover were the fastest growing attack types affecting online merchants in 2021.

German antifraud technology provider Fraugster launched its first annual Payment Intelligence Report and found synthetic identity fraud more than doubled (up 109 percent) from 2020 to 2021. Gift card fraud was up 70 percent over the same time frame and account takeover attacks experienced a year-over-year surge of more than 50 percent.

“In 2021, we saw a massive rise in the use of fake and synthetic identities, constructed from stolen information widely available on the Dark Web,” the report’s authors wrote. “This has made it easier for fraudsters to pass KYC checks for new services like BNPL, gift cards, and online gaming platforms. We expect this trend to continue, however we forecast a fightback as machine learning algorithms get better at identifying signals that point to an increased probability of fraud, for example a frequent change in IP address, device ID mismatches, and frequent asset hopping.”

To read the entire report, click here.

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