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Banking on Lies: How Synthetic Identities Are Infiltrating the Financial System

NEW YORK — As global financial institutions race to digitize their services, they are also opening new doors to deception. Synthetic identities—digital constructs of entirely fabricated individuals—are being used by transnational crime syndicates, including the Kinahan Organized Crime Group (KOCG), to infiltrate the banking system. These forgeries pass through know-your-customer (KYC) onboarding, open high-limit accounts, and enable the laundering of millions of dollars without triggering alarms. This new wave of fraud is highly sophisticated and often undetectable by legacy systems. Financial institutions are facing urgent threats not just to compliance, but to their reputations and stability. Amicus International Consulting is working with banks, fintech firms, and regulators to deploy advanced synthetic identity detection and risk prevention strategies. Synthetic Identities: A Trojan Horse in Modern Banking Unlike stolen identities, which rely on co-opting real personal information, synthetic identities are created from scratch using AI-generated photos, fake credentials, and forged metadata. Once established, these personas are weaponized to: Open bank accounts across multiple jurisdictions. Secure credit cards, loans, and even mortgages. Move crypto into fiat via exchange platforms. Create transaction histories to build 'legitimacy.' Launder illicit funds under the veil of legitimacy. A single synthetic identity can enable a criminal enterprise to move millions through bank systems, exploit government programs, and evade financial monitoring protocols. Real-World Case Study: The Kinahan Cartel's Banking Web In 2024, U.S. authorities uncovered a ring of synthetic identities used by Kinahan-linked proxies to open high-value accounts in Switzerland, Estonia, and the UAE. One such identity—'Aleksei Popov'—was used to: Open accounts at three banks using falsified CBI-acquired documents. Pass KYC checks with a digitally generated passport image and facial recognition spoofing. Funnel over USD 12.8 million in Monero proceeds from narcotics deals through various shell companies into clean Euros. The identity was maintained for nearly 30 months without detection. It wasn't until Amicus flagged behavioural inconsistencies in transaction metadata that the network was dismantled. How Synthetic Identities Slip Past Compliance Systems 🔍 Weaknesses in Traditional KYC: Reliance on visual ID checks (e.g., matching a selfie with a passport) can be spoofed with deep fake tools or 3d facial overlays. Document forgery can pass verification when issued by legitimate governments under CBI programs. Address verification using forged utility bills or prepaid phone statements can easily be faked. 🧠 Behavioural Inconsistencies Missed: Synthetic identities often exhibit abnormal transaction patterns: excessive foreign transactions, non-usage during peak times, or lack of location diversity in device usage. These flags are often ignored unless paired with blacklist or fraud reports. Emerging Tactics: Financial Fraud by Design Criminals now design synthetic identities with the goal of 'aging' them over time. Tactics include: Account farming: Opening multiple bank accounts, leaving them dormant, and slowly adding transaction history. Opening multiple bank accounts, leaving them dormant, and slowly adding transaction history. Layering financial history: Using AI tools to create plausible payroll receipts, tax filings, or invoices. Using AI tools to create plausible payroll receipts, tax filings, or invoices. Piggybacking on real identities: Combining partial real data (e.g., a real Social Security number with a fake name) to boost credibility. These synthetic identities are then used to pass compliance at Tier 1 banks, international crypto exchanges, and digital asset lenders. The Cost to the Banking Industry According to a 2024 Deloitte report: Synthetic identity fraud cost U.S. financial institutions over $6.8 billion in 2023 alone. in 2023 alone. The average lifespan of a synthetic banking customer before detection is 16 to 24 months . . 61% of banks admit they cannot distinguish synthetic from real identities during initial onboarding. This represents a threat to compliance and a long-term systemic risk. How Amicus International Is Helping Banks Fight Back Amicus International Consulting has developed a three-layer synthetic identity detection framework, which several international banks and fintech platforms are already piloting. 1. Synthetic Risk Scoring Engine (SRSE) Our AI model analyzes hundreds of signals from onboarding to ongoing usage to assign synthetic risk scores. Key metrics include: Facial geometry symmetry Metadata entropy (too perfect = red flag) Transaction velocity anomalies Time zone/device inconsistencies 2. Deep KYC Behavioural Profiling Instead of relying only on document verification, Amicus deploys behavioural analytics tools that detect: Unrealistic device or access patterns Financial behaviour mismatches across customer demographics Microtransaction layering (a standard laundering method) 3. Blockchain and Crypto Wallet Attribution We partner with chain analysis firms to: Track wallets linked to known fraud cases. Flag accounts funded by mixers or high-risk exchanges. Reverse engineer funding routes that originate from synthetic applicants. Integrating Amicus into Banking Infrastructure Amicus is currently advising institutions in: The European Union on PSD2-compliant digital identity safeguards. on PSD2-compliant digital identity safeguards. The UAE and Singapore on cross-border account vetting for high-net-worth clients. on cross-border account vetting for high-net-worth clients. North American fintech startups on integrating SRSE into onboarding APIS. Our systems are plug-and-play compatible with major KYC providers, including Jumio, Onfido, and Trulioo. Regulatory Recommendations Amicus advocates for: Mandatory behavioural biometrics in addition to facial ID for onboarding. Global blacklist of synthetic identities and known fraud artifacts. Enhanced scrutiny of crypto-fiat ramp services tied to bank accounts. Unified CBI-KYC review systems between banks and passport-issuing jurisdictions. Conclusion: The Synthetic Identity Threat Is Real—and Growing In today's digital-first banking environment, criminals no longer need to break into banks. They build fake customers that walk through the front door undetected. Synthetic identity fraud is fast becoming the most advanced financial crime of the 2020s. At Amicus International Consulting, we are not only identifying synthetic identities but eliminating the digital soil in which they grow. 📞 Contact Information Phone: +1 (604) 200-5402 Email: info@ Website: Follow Us: 🔗 LinkedIn 🔗 Twitter/X 🔗 Facebook 🔗 Instagram TIME BUSINESS NEWS