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Synthetic Identities

My previous post ‘Legends, Sock-puppets and Synths’ explained how false identities are used and abused by various organisations (some legal-some not) to achieve their goals. I’m now going to attempt to describe how Organised Crime Groups (OCGs) use them to commit large scale fraud. The creation of synthetic identities (synths) presents not only immediate and significant risks, but also very real and personal risks to those whose identity may have been stolen and/or manipulated.

The previous post described how a previous colleague Adam, (a fellow fraudster) runs a thriving business creating synths and sells them on to others. One of Adam’s best customers is a chap he refers to as “Roger the Dodger’ and he takes things one stage further. Roger is part of an OCG and buys batches of 50 synths and uses them as the basis for applying for bank accounts and credit cards. Once again, he takes a long-term view and is not looking for quick-wins.

If you are an avid reader of this blog (who isn’t?) you will be painfully aware of how easy it is to open accounts etc using forged of Fraudulently Obtained Genuine documents (FOGs). Once these accounts are associated with the comprehensive back-story created by Adam, it is open season on the banks and credit card companies.

Feeling sorry for these institutions is about as popular as kicking kittens, and that is understandable because they will only pass on their losses to customers in the way of increased charges etc. Working on much the same principle as Adam, Roger’s team of 2 (one of them is his wife and the other is his brother-in-law) start to build a positive credit history for each of the synths by sending each other payments for imagined goods and services, including a number of Direct Debits. The money involved merely circulates from one account to the other, and all of them are owned by Roger, so it actually costs him nothing to do this.

After a period of about 6 months he then applies for credit cards for the synths. You only have to check your junk mail and unsolicited pop-ups on the web to realise that there is no shortage of companies who want your business. They require minimum documentation, allow you to apply online and promise to give you a very quick decision regarding acceptance. The default position for many appears to be that they will onboard you as a customer unless they can find a darned good reason not to. Even if the initial application is refused as there is no existing credit history, the application causes a credit profile to be opened. The next application gets a hit on this profile and the application is usually approved.

The credit card company clearly need to set a limit to manage the risk of having a new customer. This limit is usually determined by a number of factors, including (1) how much you earn (2) any outstanding debts, (3) your credit history, (4) if you have other credit available to you such as an agreed overdraft facility on a bank account.

Once the credit card account is up and running, Roger adds additional authorised users to each card, thus establishing ‘new’ identities that can later apply for cards themselves. Roger then does the same thing with his credit card as was done with the bank account. He regularly ‘buys’ a number of items and pays bills to create the impression that this is a legitimate and frequently used account. It is used as ‘credit collateral’ when applying for other financial products including more credit cards and store cards etc. Roger and his team then request a higher credit limit on each card. As the credit card company becomes more and more confident, they continue to raise the limit - sometimes they even do this without a request from the customer as they believe it will encourage them to spend more. Roger and Co are more than happy with this as the credit card company are saving them the bother of doing it themselves. The comparison website uSwitch believe that two thirds of customers have had their credit limit increased without requesting it. On average he waits just over 12 months and tries to get the limit for each card to about £20,000.

Roger then uses his professional (criminal) judgement to decide when he thinks it is time to strike. They normally buy things like mobile phones and tablets or gift cards - all incredibly easy to sell on. Fifty accounts at c£20,000 each nets him about £1,000,000 worth of goods. Roger takes his cut and the rest goes to the OCG where it is used to fund people trafficking.

He pays himself and his team well but the OCG still stands to make a huge profit from doing nothing but opening credit card accounts, artificially moving money from one account to another, and lulling the credit card companies into a false sense of security so they raise the card limit until it is ripe enough to be plundered. I’ve had a quick look on a few employment sites but I can’t find anything that pays anything as well as this!

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