Identity Fraud in Auto Financing Surges 75% in the UK — U.S. Dealers Take Note

Identity Fraud Up 75% Among UK Auto Dealers

A recent warning from Close Brothers Motor Finance, one of the UK’s leading auto lenders, reveals a startling 75% increase in identity fraud incidents reported by motor dealers over the past year.

In a dealer sentiment survey:

20% of UK dealers listed identity fraud as their top fraud concern.
Synthetic ID fraud and second-party fraud were flagged as the most common and hardest to detect.
Many dealers admitted they still lack tools to prevent fraud at the early stages of a sale.

Close Brothers is sounding the alarm — and leading by example.

“At Close Brothers Motor Finance, we have already been taking a number of steps to protect our business and our dealer partners,”
said Seán Kemple, Managing Director.
“Fraudsters are more sophisticated than ever and the tactics they use continue to evolve.”

🎭 Synthetic and Second-Party Fraud on the Rise

These types of fraud share one thing in common: they often slip through dealership systems unnoticed, until it’s too late.

Synthetic fraud involves creating a fictitious person by combining stolen and fabricated data.
Second-party fraud happens when a person knowingly applies using someone else’s identity — often with that person’s consent — to qualify for financing they wouldn’t normally receive.

In both cases, the true identity behind the transaction is never fully verified.

💥 What Happens When Red Flags Are Missed?

Dealers end up delivering vehicles to fraudsters who vanish — vehicles unrecovered.
Lenders are left with high-risk or fraudulent loans in their portfolios.
Real consumers may later discover their identity was misused, sometimes after significant financial damage has occurred.

🔒 Close Brothers’ Message: Protect the Front End

Close Brothers’ leadership shows what responsible lending looks like. By investing in identity verification and tightening dealer protocols, they’re not waiting for regulators or insurers to solve the problem.

And U.S. lenders should take note.

✅ How VeriQual Protects U.S. Dealers and Lenders

Fraud doesn’t start at funding — it starts at lead capture and prequalification.

VeriQual™ was designed to shut the door on fraud before it enters your CRM.

Verifies identity before credit is pulled
Uses only a phone number to authenticate in real time
Blocks synthetic and second-party fraud attempts immediately
Delivers only clean, validated leads to your sales and finance team

It's the same approach Close Brothers is implementing — but customized for the U.S. market.

🛡 The Time to Act Is Now

Identity fraud is surging globally. What’s happening to UK dealers today could hit U.S. dealerships tomorrow — unless we act now.

Dealers and lenders: Don’t wait until fraud is in your pipeline to care about identity verification.