By Stephen Walter, lawyer and CEO of Sunset
There’s a form of fraud most families have never heard of until it happens to them. Criminals call it “ghosting”: using a dead person’s identity to open credit cards, take out loans, or file tax returns. It works because a person can be dead for months while the U.S. financial system thinks they’re alive and in good standing.
At Sunset, we’ve helped over 14,000 families uncover and close financial accounts after a death, and we have saved many of them from ghosting and other fraud in the process. Below are five tips to help your families prevent post-death identity theft, and some background on why the system leaves this door open.
Why the Deceased are Easy Targets
When someone dies, their Social Security number, date of birth and address don’t stop working. They sit in databases, still capable of passing an identity check.
With a name, Social Security number and birth date, a fraudster can open credit cards, apply for loans, or file a tax return claiming a refund. Existing accounts are exposed, too: a credit card number skimmed before the death, or lifted from an unattended mailbox, keeps right on working, and the charges land on bills nobody reads.
The gap is bigger than most people assume. Banks and bureaus rely on the Social Security Administration’s Death Master File to learn who has died, but since 2011, roughly a million death records a year are withheld from its public version. A study by the fraud-analytics firm ID Analytics estimated that the identities of nearly 2.5 million deceased Americans are misused each year, 800,000 of them deliberately targeted. In our experience at Sunset, that number is still rising.
And how do fraudsters learn someone has died?
From obituaries, and they don’t stumble across them. Fraud rings systematically scan the obituaries on funeral home websites, harvesting names, birth dates and addresses, then filling in the rest from data brokers. It’s uncomfortable to say, but the funeral home’s own website is often where the crime starts. Publish obituaries without talking to families about prevention, and you’re part of the problem without meaning to be.
Who Actually Pays for the Fraud?
Here’s something worth saying to families plainly: The estate is almost never on the hook for a fraudster’s charges. Debts incurred by an impersonator are not debts of the deceased, and executors don’t have to pay them.
But “you won’t have to pay” is not the same as “this won’t hurt.” Disputing fraud means letters, affidavits and certified death certificates, sent to companies whose phone trees were not designed for grieving people. It can drag on for months, and it feels like a violation of someone the family just lost.
And there’s one place the estate can genuinely lose money: The assets the deceased already had. A fraudster who drains a checking account, retirement fund, or brokerage account is taking money the estate owns. Fraud guarantees are designed for living customers who report promptly; a theft an executor discovers six months later is a much harder claim, and money wired out may simply be gone.
Why the Problem Is So Hard to Solve
Why don’t the institutions fight this themselves? Because for a bank or a bureau, a false positive is far worse than a false negative. Miss a death, and a fraudster opens an account that eventually gets written off. Mark a living person dead, and you’ve destroyed their financial life: cards declined, loans denied.
I’ve personally spoken to the credit bureaus about this, and they admit they’re caught in a trap: Flag files too easily and they’ll declare living people dead … demand proof and the fraud window stays open. So, they won’t flag a file on a phone call or a web form; they require a death certificate. Banks are the same about freezing accounts; otherwise, anyone could freeze anyone’s account with a phone call. The paperwork exists to protect living people.
Another problem is that no one is in charge. Three competing bureaus, thousands of banks and card issuers, and an incomplete federal death file all learn about deaths separately. There is no moment when the system collectively finds out someone died. Someone must tell each part, and that someone is the family.
How the Social Security Administration Helps, Slowly
In most states, after a death certificate is verified by the county, it is sent to the Social Security Administration, which processes it and adds the name and Social Security number to the Death Master File. The three major credit bureaus monitor this file and place a deceased indicator on the credit file of anyone added to it.
Any lender who later pulls that file sees the flag and denies the application. Since nearly every mainstream lender checks at least one bureau, the flag closes the window fraudsters exploit.
Sunset is an approved data partner of the Social Security Administration with direct access to the Death Master File, so we’ve verified this firsthand: it can take months for a death to appear in the file, if it appears at all. When every day matters, you don’t want to rely on that process.
Five Simple Steps to Prevent Ghosting
Here are five things, most of them an afternoon’s work, that close nearly every door a fraudster can use. One prerequisite for your families: They should order more certified copies of the death certificate than they think they  need, because nearly everything below requires one.
1. Notify the three credit bureaus.
This is the single most effective step, and the one families most often skip. The reason they skip it is tedious: They must send three letters to three addresses, enclose specific required contents and include a copy  of the death certificate. A good time to remind the family to do this is when you are delivering or mailing the death certificate copies.
So, we built a free tool at Sunset that does it. The family enters the deceased’s information once and uploads a copy of the death certificate, and Sunset generates properly formatted death notification letters for Equifax, Experian, and TransUnion and mails all three. It costs nothing and doesn’t require signing up for anything else; it’s a standalone tool anyone can use, at hellosunset.com/report-death-to-credit-bureaus.
Sunset is my company, so I have an interest to declare. But the tool is genuinely free, no strings attached, and a family that would rather mail the letters themselves has everything they need right here.
For the do-it-yourself route: each letter should include the deceased’s full legal name, last address, Social Security number, dates of birth and death, a copy of the death certificate, and the sender’s name and relationship. Mail one to each bureau: Equifax, P.O. Box 105139, Atlanta, GA 30348-5139. Experian, P.O. Box 4500, Allen, TX 75013. TransUnion, P.O. Box 2000, Chester, PA 19016. What matters is that the letters get sent.
The bureaus recommend that a surviving spouse or a court-appointed executor or administrator be the one to notify them. I don’t think it’s worth waiting for a court appointment; whoever receives the death certificate copies should send the letters right away.
2. Notify all the deceased’s banks, card issuers and brokerages.
When a card issuer learns of a customer’s death, it deactivates the card, freezes online access, stops automatic charges and routes the account to its estate department. The balance becomes a claim against the estate, but no new charges can be made, so a stolen wallet or a compromised card number becomes useless. Banks and brokerages do the same on the deposit side: the account is frozen, with no withdrawals or wires until the executor presents letters from the probate court.
We have also confirmed with the bureaus that creditors like credit card companies report deaths upstream to the bureaus, so notifying creditors reinforces the bureau flag.
The notification is a letter or call stating the date of death, usually with a copy of the death certificate. The deceased’s credit report is the ideal list of accounts to work from, but the bureaus have no quick way for family members to get it; the request goes through the same lengthy mailing process. If the family doesn’t want to use an inheritance tool like Sunset, the best advice is to go through the wallet, purse, and papers of the deceased, make a list, and notify quickly. Speed matters most here, since drained deposits are hard to recover.
3. Keep the obituary light on identifying details.
Don’t let your families make an unforced error by divulging unnecessary personal information in the obituary. Omit the exact birth date, the home address and the mother’s maiden name. None of these are necessary to honor a life, and together they’re a gift to the fraudsters reading it.
This is a step funeral directors are uniquely positioned to help with, since you often write the obituary and publish it on your website. If you work with a software or AI company that drafts and distributes obituaries online, insist their templates leave these details out.
4. Redirect the mail.
Help the family forward the deceased’s mail through the post office and sign up for as many do-not-contact lists as possible. Forwarding mail to the executor keeps statements and preapproved credit offers out of an empty mailbox, and the marketing industry’s deceased do-not-contact list stops more of the latter. An unattended mailbox full of financial mail is one of the easiest ways for an awful neighbor to harvest account numbers.
5. File the final tax return early.
Refund fraud is one of the most common uses of a deceased person’s identity, and filing early beats the fraudster to it. This is also a good moment to reassure families about a step already done: Funeral homes report deaths directly to the Social Security Administration when the death certificate is filed, and most families don’t realize it. Telling them is both a service and a relief.
That’s the list. Do what you can to help, and if fraud appears anyway, tell families not to pay it. Dispute it in writing; the estate is not liable for a fraudster’s spending. Families remember the people who told them things they needed to know before they knew how to ask.
About the author: Stephen Walter is an attorney and the cofounder of Sunset (hellosunset.com), which helps families settle estates end to end: finding assets, preparing probate documents, opening estate accounts, and transferring inheritances. Sunset is free for families and has helped nearly 14,000 of them, in all 50 states.
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