Synthetic Identity Theft is a growing form of fraud in automotive sales. Fraudsters piece together a fake identity, build up a credit line for that false ID and eventually "go big" and do something like buy a car with that false identity. The growing rate of auto loan fraud is increasing the risk of issuing an auto loan. Understandably, lenders are becoming more cautious when issuing loans. This trend is certainly adding friction to the finance portion of the car sales process and could ultimately make auto loans more expensive.

Enter iovation, a TransUnion subsidiary that has created a way of rating "device reputation." With iovation's technology, it's possible to detect if an electronic device, like a mobile phone, has been used in the past for fraudulent transactions. While this doesn't stop synthetic identity theft on its own, it certainly adds another layer of security that makes it easier for lenders to detect fraudulent credit applications.