2025 Identity Fraud Trends Impacting Government Agencies

Reduce fraud, waste and abuse to improve program efficiency

Government efficiency has become a critical priority — with an emphasis on reducing fraud, waste and abuse. Across various levels of government, agencies have been striving for decades to improve constituent services by shifting to digital-first customer experiences. As program and benefit administration has become more streamlined via digital channels, constituents now show a clear preference for completing many administrative tasks in this manner.

The rise of digital identity fraud

The increased reliance on digital channels for delivering services, such as program and benefit enrollment and administration, has led to a surge in criminal activities, particularly identity-based fraud. TransUnion® has analyzed fraud signal data — including device intelligence, data breaches, synthetic identity risk models and identity verification transactions — revealing trends that indicate heightened digital fraud risk for the public sector in 2025.

Key fraud trends highlight digital risk:

6.7% of government transactions were suspected digital fraud, a 33% increase from 2023 to 2024

13.2% of government agency identity verification checks had Social Security number (SSN) mis-matches

0.08% of government digital identity verification checks were suspected of being a synthetic identity

How agencies can address fraud trends

To mitigate the growing digital risk and better ensure efficient service delivery, government agencies should consider how enhanced risk signals, supported by a clearer understanding of identity, can improve fraud detection and enhance the constituent experience. Advanced identity verification and identity proofing covered include:

• Detecting deepfake documents
• Identifying spoofed calls
• Spotting synthetic identities
• Flagging suspicious devices