Equifax has launched a new fraud prevention solution. This aims to help businesses fight a growing form of financial crime. The company introduced Synthetic Identity Risk, an advanced detection product. It uses artificial intelligence to spot and prevent synthetic identity fraud before it causes financial losses.
Synthetic identity fraud is hard for lenders to spot. Criminals mix real personal data with fake info to create believable identities. These false profiles help open credit accounts or secure loans. Fraudsters often make initial payments to gain trust, then default later. These identities can stay hidden for a long time. Lenders face big charge-offs when the fraud is found out. Equifax estimates that the average loss per confirmed synthetic identity is about $13,000.
The new Synthetic Identity Risk solution uses patent-pending technology. It evaluates identity attributes, credit behavior, and transactional signals. This helps determine the risk of synthetic activity. Advanced machine learning models power the system. They uncover fraud patterns that traditional rules-based methods might miss.
Equifax noted that the product can support organizations at multiple stages of the customer lifecycle. It can be deployed during account opening to flag suspicious applicants in real time, or used on an ongoing basis to monitor existing portfolios for previously undetected risk. This ongoing approach lets lenders spot emerging threats sooner. They can then take quick preventive action.
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The combination of identity intelligence and behavioral knowledge provides a better understanding of risk. This enables companies to prevent fraud while providing a seamless experience for genuine customers.
“Synthetic identity fraud is a rapidly growing threat impacting the consumer lending ecosystem,” said Felipe Castillo, Chief Product Officer for U.S. Information Solutions at Equifax. “With Synthetic Identity Risk, Equifax strengthens lenders’ fraud defenses, helping them to uncover hidden risks and ultimately shift from reactive loss recovery to proactive prevention. In doing so, they not only reduce their financial losses but they safeguard and build long-term trust with their legitimate customers.”
With fraud schemes growing more sophisticated, Equifax’s latest offering reflects a broader industry shift toward AI-powered, preventative risk management—aimed at protecting both financial institutions and the consumers they serve.