Identity theft after death: A widespread problem

Things to know about identity theft

• Fraudsters steal the identities of around 2.5 million deceased Americans every year.

• Identity thieves can open credit cards, apply for loans, buy cell phones and more using the personal information of someone who has died.

• These thieves, or “Ghosters,” often maintain their new identity, instead of quickly moving from target to target.

• Synthetic identity theft involves the action of combining real information with fictitious personality information when fraudulently completing a credit card or loan application.

You’re dealing with a lot right now, and more stress is the last thing you need. But in order to avoid even more stress down the road, you should be aware that identity theft of those who have recently passed away is a serious issue.

It’s a sad fact, but there are criminals out there who are looking to prey on you precisely because you are in a vulnerable situation. Opportunistic thieves are all too aware that the dead can't monitor their credit. And all too often, their grieving relatives don’t think to do it either. 

This particular form of identity theft is commonly called “ghosting,” and it can go on for months before financial institutions catch on. According to the IRS, fraudsters steal the identities of around 800,000 deceased Americans every year, many of whom are targeted specifically because they died. Using the personal information of someone who has died, identity thieves can open credit cards, apply for loans, buy cell phones, or almost anything else you can think of.

How does ghosting work?

Unlike typical identity thieves, who quickly move from target to target, ghosters often adopt and maintain this new identity, which then allows them to get a good credit rating and obtain more financial freedom—which is especially tempting for those with a history of bad credit, or even a criminal record. 

Some ghosters try to seek out targets that match their personal appearance. It’s easier to pass as someone else if you share a similar age, height, gender identity, and race or ethnic background. Then again, with so much of our lives happening online, in many cases that doesn’t come into play at all. 

There’s also what’s known as synthetic identity theft, in which a criminal intentionally combines real information, such as the Social Security number of someone who has died, with totally fictitious personal information when fraudulently completing a credit card or loan application.

One of the most popular ways ghosters steal money is by filing for tax refunds under an assumed identity. In past years, the IRS has issued fraudulent tax refunds totaling in the billions. It’s a big business. In 2015, a single ring of identity thieves was arrested in Detroit for filing 306 returns that totaled almost $500,000, all collected by filing returns on behalf of people who had died.

Potential financial consequences

If you happen to find yourself in this incredibly stressful situation, keep in mind that family members are ultimately not responsible for fraudulent charges. But just because you won’t be held liable doesn't mean that ghosting is harmless. 

Often the first indication people get that their loved one’s identity has been stolen is when creditors contact them for payment. Obviously, an unexpected call from a creditor is never a pleasant experience. To find out that it’s because someone has taken liberties with your loved one’s personal information can be even more frustrating and painful. 

In addition to dealing with creditors, it can lead to complications in handling the estate. Lenders who’ve been taken in by the scammers can lose money in the name of the person who has died. A few years ago, there was a case of a ring of conspirators in Ohio who forged a will on behalf of their deceased landlord and managed to take control of his estate, worth $2.2 million dollars. At an already emotional time, it’s almost unthinkable to consider facing this kind of legal nightmare.  

There is a small silver lining. Even though ghosting is still incredibly common, the availability of online information has actually made it harder rather than easier. As late as the 1990s, each state in the US kept birth and death records separate, so it was hard to cross reference the two registries. Now that almost everything has gone online, government clerks can quickly use search engines to determine if a particular individual has been issued both a birth and a death certificate. As long as the proper government agencies, such as Social Security, have been informed, it’s very easy to find out whether someone is no longer living, making it fast and simple to catch this type of fraud.    

Emotional repercussions

Identity theft also takes an emotional toll, ranging from mild annoyance to more intense feelings of distress, anxiety, and depression. When the victim is a loved one who has passed away, that emotional impact can be even more severe. 

In addition to whatever feelings of grief you may be experiencing, now it may feel like someone has tried to take away one of the few and most precious things that remain of the person you loved. You may feel as though their memory has been desecrated. You may feel like the thief tried to steal their very essence, the thing that defined the edges of their selfhood—their name. Identity theft is always an act of violation and disrespect, and when the victim is no longer here to defend themselves, the violation can feel even more egregious. 

If you find yourself in this very frustrating position, take a moment to sort through your emotions before reacting. Seek advice. Consider what you want your end goal to be and how you want to get there. Do you want to file a police report? If you choose not to, consider that if the ghoster gets away with their crime, they may go on to do it again.  

One of the most unpleasant things about ghosting is that it can often be an “inside job.” Relatives and close friends with access to personal information can quickly and quietly assume your loved one’s identity for their own personal gain. This will likely lead to feelings of betrayal, on top of whatever other feelings of grief you may be processing. 

Even though it may be on you to make things right, remember that you did nothing wrong and that you are not to blame. You have been made the victim of an unfortunate circumstance, but there is a network of resources and support available to you. Reach out to family and friends, or a professional who may be able to help you sort through the situation.

You may be eligible for free bereavement support. Empathy can help with everything from funeral planning to estate administration, with step-by-step guidance and real-time expert support. Many people get free premium access to Empathy as a benefit with their life insurance claim. We partner with New York Life, Guardian Life Insurance Company, Bestow, Lemonade, and other leading carriers. When you make your life insurance claim, talk to your representative about whether Empathy is a benefit they offer.