The US saw around 1.6 million Bank Secrecy Act (BSA) reports in 2021 tied to the exploitation of identity processes during account creation, account access, and transaction processing, indicating $212 billion in suspicious activity.
The Financial Crimes Enforcement Network (FinCEN) has published analysis on how bad actors exploit identity-related processes involved in processing transactions as well as opening and accessing accounts.
It shows that 42% of the BSA reports filed in 2021 related to identity. Within this, there are over 14 typologies commonly indicated in identity-related BSA reports.
The most frequently reported were fraud, false records, identity theft, third-party money laundering, and circumvention of verification standards. These top five typologies accounted for 88% of identity-related BSA reports and 74% of the total identity-related suspicious activity amount reported during calendar year 2021.
While most financial institutions in the identity-related BSA dataset reported impersonation as their top identity exploitation, money services businesses most often reported circumvention of verification. The report also found that compromised credentials have a disproportionate financial impact as compared to other types of identity exploitation.
FinCEN director Andrea Gacki says: “Robust customer identity processes are foundational to the security of the US financial system, and critical to the effectiveness of financial institutions’ programmes to combat money laundering and counter the financing of terrorism."
Read the full analysis