Equifax launches tool to combat synthetic identity fraud
Equifax has launched a product that uses artificial intelligence (AI) to detect and help prevent synthetic identity fraud.
Synthetic identity fraud is a rapidly growing threat in which fraudsters create fictitious identities and use them to open credit accounts or obtain loans, the company said in a press release on Friday (Jan. 23).
Equifax's new comprehensive identity risk product uses machine learning algorithms to discover fraud patterns based on identity data, credit history and behavioral signals; detect potentially fraudulent activity; and flag that activity so businesses can make decisions about identity verification and fraud prevention.
Depending on the version, the product can be used at account opening or on an ongoing basis as an account management tool.
“Synthetic identity fraud is a rapidly growing threat impacting the consumer lending ecosystem,” Felipe Castillo, chief product officer of U.S. Information Solutions at Equifax, said in a press release. “With synthetic identity risk, Equifax strengthens lenders' fraud defenses, helping them uncover hidden risks and ultimately move from reactive loss recovery to proactive prevention.”
According to “When 'Good Enough' Is Not Enough: Digital Identity in the Age of Bots and Agents,” a collaboration between PYMNTS Intelligence and Trulioo, synthetic identity fraud is one of the most common and costly threats facing financial services companies.
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The report found that this form of fraud exploits automation and scale, often passing traditional verification checks designed for simpler environments.
AI tools enhance the threat of synthetic identity fraud by allowing fraudsters to create fake companies and customers and hinder fraud prevention efforts, according to “Companies Leverage Artificial Intelligence to Fight AI Fraud,” a collaboration between PYMNTS Intelligence and Finexio.
This has prompted companies to upgrade their systems to mitigate risks associated with the latest artificial intelligence threats, the report said.
Equifax said in October 2025 that it was preparing to launch new fraud prevention tools. During the company's earnings call, management focused on efforts to use artificial intelligence tools to combat fraud, specifically the increase in synthetic and first-party fraud.
“Fraud remains one of the most important and rapidly evolving threats facing our customers,” Equifax CEO Mark Begor said on the call. “We are leveraging new advanced artificial intelligence capabilities and unique data assets to deliver a new generation of fraud prevention tools that identify risks invisible to traditional methods.”
