TransUnion has introduced new solutions designed to help organizations combat synthetic identity fraud and credit washing.

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The company says its Credit Washing and Synthetic Fraud Scores, announced Tuesday (Oct. 20), are the first-ever “adverse-actionable” solutions of their kind in the market, meaning lenders can make credit decisions and give consumers “applicable adverse-action reason codes explaining why they were denied credit,” capabilities previously unavailable.

“Synthetic identity fraud and credit washing present unique challenges because they can conceal risk behind seemingly legitimate consumer profiles,” James Garvert, executive vice president of global fraud and communications solutions at TransUnion, said in a news release.

“By bringing advanced fraud intelligence into explainable, FCRA-governed decisioning, we’re helping organizations uncover threats that might otherwise go undetected, make more confident decisions, and mitigate potential financial losses.”

Synthetic identity fraud occurs when a real person’s information is stolen and merged with falsified personal information to establish a new identity.

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Credit washing is the removal of legitimate, negative information from a person’s credit history, often through fraudulent credit disputes.

Together, they are among the fastest growing and most costly types of financial crime, TransUnion said, with company research placing total lender exposure to synthetic identity fraud at $2.4 billion as of June of this year.

“By combining real and fabricated identity elements to create seemingly legitimate consumer profiles, fraudsters can evade traditional detection methods, establish accounts and generate substantial losses,” the company said.

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