While flagging fake IDs is a key part of the KYC process, it becomes a lot more challenging when you’re dealing with a real person who is unaware their data has been stolen. laundering money without linking transactions to their real-life identities.taking out credit loans that they have no interest in repaying.opening bank accounts under someone else’s name.Identity theft happens in numerous ways but the goal is always the same: to leverage real people’s data for nefarious deeds.įraudsters and criminals who rely on stolen identities can then target banks in the following ways, for instance: Why Is Identity Theft a Problem for Banking?
Today, let’s look at how identity theft impacts banking institutions – and especially online neobanks and challenger banks. Just in the US, criminals stole the identities of 15 million individuals in 2021 and used them for fraudulent schemes that affected 40 million Americans.
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