Frankenstein started way back a couple of years ago when a bank based in Missouri gave a loan to a man after checking his credit score and other things. Soon the borrower stopped giving the monthly EMIs and then they faced the trouble. But when the same bank – Notre Dame Federal Credit Union started the investigation, it came out with the fact that such person does not exist in real. By that time, they had lost a huge amount of money to such people who have taken loans from them. The firm then learned that people getting loans simply fooled them with their auto loans using their credit cards. Thus, Frankenstein technique arose.
However, we do not see the Indiana based bank alone in this area as many of the banks have faced similar situation making them victims of Frankenstein despite having their own checks and balances. The Boston-based Aite Group was seen estimating the kind of fraud it has cost to the U.S. lenders found in between $10,000 to $15,000 per incident. As per one of the estimates the company called Auriemma Insights have put the figure of around $6 billion a year in such scams. Nowadays, Frankenstein has become the fastest-growing financial crime claimed by the Federal Reserve, which is driven in part by lending the money moving online.
Let’s talk more on the rise of “Frankenstein” fraud. In order to fool the lenders, the cybercriminals are seen choosing any random security number or procure anyone on the dark web. They would usually look for the one that is issued to anyone who happens to be younger than 18 years old making sure that person has no credit history in the market. They then come out with the fake name, date of birth along with the other social media accounts. They tend to start applying for the credit card and thus building up the FICO score that would take years in many of the cases.
Frankenstein is a really long trail and that goes for an expensive one as well claims Naftali Harris, the co-founder and CEO of San Francisco-based company called SentiLink. So, when banks see anyone with 800 Credit Score, they are likely to embark with offers of limitless credit cards to unsecured several loans from Banks. So, with a high credit score, one can see the banks not even caring to check for other details like name, address, date of birth and social security number and so on. So with such cases, the banks are now being taken for a ride.