You work hard to keep your children safe and healthy from the moment they are born. Childproofing the house, cleaning cuts and scrapes, teaching them to look both ways before crossing the street, making sure they eat fruits and vegetables, signing them up for swim lessons, helping them learn how to drive…the list goes on and on. But few parents realize that protecting their children's identity is also important.
A Carnegie Mellon CyLab report on child identity theft found that an alarming 10.2% of the children studied had impersonators using their Social Security number (SSN). For adults in the same population, the figure was 0.2%. A 2012 study published by AllClearID found that minor children are 35 times more likely to have their information stolen than an adult.
Why are children targets?
Their financial history is a blank slate. They have no credit, which also means they don’t have bad credit. Plus, they never check their credit score. Since children are not regularly applying for credit and thus monitoring their financial identities, fraud can go undetected for many years.
What are the warning signs?
Thieves can use your child's personal information to open bank accounts, apply for credit cards, rent an apartment, start a new job, apply for utilities, access federal benefits such as welfare and unemployment, and even take out major loans. The damage caused by this theft may not be discovered for years, but there are some warning signs to be on the alert for:
- Your child receives numerous credit card applications in their name.
- Your child receives numerous calls or letters from collection agencies.
- Your child is denied government benefits because another account is using their SSN.
- Your child gets a notice from the IRS stating they didn’t pay their income taxes.
- Your child is denied a driver’s license because someone else used their SSN to obtain one.
What if I suspect theft?
If you do suspect identity theft, the first thing you should do is check your child’s credit report with each of the three credit bureaus – Experian, Equifax and TransUnion. If it turns out there is no credit file, then your child’s SSN and other information hasn’t been used to obtain any credit.
Checking your child’s credit report isn’t as simple as checking your own. You will need to provide documentation proving that you are the parent or guardian. Each credit bureau has its own process for verifying a minor’s credit report so check each bureau’s website for details.
How can I prevent identity theft?
The actions taken by an identity thief can haunt your children into adulthood by preventing them from obtaining student loans, employment or housing. Hopefully your child's identity will never be stolen, but a bit of preparation can go a long way in preventing it from happening. Take these steps to protect your child from this increasingly common crime.
Tip #1 – Keep your child’s SSN under lock and key. Don't carry it in your wallet, shred documents with this identifying information, and share it only when absolutely necessary. If extracurricular activities or community groups ask for it during registration, see if they'll accept alternative identification.
Tip #2 – Actually, lock up all of your child’s most important personal information like their SSN, birth certificate, passport, etc. in a home safe or a bank safe deposit box. It might be surprising to hear but identity theft is often a “family affair” so make sure this information is not easily accessible.
Tip #3 – Open a joint youth checking account so you can monitor the account activity. Also be sure to opt out of receiving marketing material to avoid having your child receive credit card offers in the mail. Identity thieves love to target your trash for sensitive information.
Tip #4 – A child may think having their own email address can be a fun way to stay in touch with friends and relatives, but it’s also an easy access point for identity thieves. Children can easily think they’re communicating with someone they know and share sensitive information. Review online safety tips with your children frequently and monitor their online activity.
Tip #5 –Schedule a credit check when your child turns 16 to provide time to sort out any possible issues before they apply for a driver’s license, a job or financial aid.
What do I do if my child is a victim of identity theft?
First, file an 'Identity Theft Affidavit' with FTC.gov. With this affidavit, file a report with your local police including evidence such as collection notices or letters from the IRS and request the actual police report for your records. A paper trail is instrumental to help clear your child's credit of unauthorized charges.
After a police report is filed, inform the individual creditors and credit-reporting agencies of the fraudulent activity requesting they remove the illegal charges from your child's record. Provide the Identity Theft Affidavit and the police report as evidence of the theft.
As a final protective measure you can freeze your child’s credit report. A freeze will prevent lenders and others from accessing their credit report, which will stop them from extending credit and also prevents fraudulent accounts from being opened with your child’s identity.