Child identity theft is becoming all the rage. New research shows that identity thieves are focusing increasingly on kids because parents don’t pay attention, and the theft can go undetected for years. But when the victim tries to get a job or credit as a teen or young adult, the damage done becomes evident.
The scourge of child identity theft
Thousands of children and their families are being victimized by identity theft and thousands more are at risk, according to a report by Carnegie Mellon University’s CyLab cybersecurity research center. The report examined the identity protection scans of 42,232 children conducted in 2009-10 by the Debix AllClear ID Protection Network after parents were notified their children’s IDs may have been compromised. The Debix AllClear ID data showed 4,311 of the children, a little more than 10 percent, had their Social Security numbers in use by identity thieves. That’s a child identity theft rate 51 times higher than the 0.2 percent of U.S. adults targeted by identity thieves, based on 663 attacks against 347,362 adults listed in Debix AllClear ID. The youngest child identity theft victim was five months old. A 17-year old girl from Arizona discovered she was $725,000 in debt with with 42 open accounts including mortgages, car loans and credit cards. Her Social Security number was linked to eight suspects. A 14-year-old boy from Kentucky had a credit report going back 10 years listing a mortgage foreclosure.
Victims of friendly fraud
Child identity theft appears to be coming to a head after the seeds were planted in early 1980s. Back then the Internal Revenue Service directed the Social Security Administration to give all children Social Security numbers. Most children become identity theft victims at the hands of parents, family members or close friends who have access to their Social Security numbers. According to Javelin Strategy & Research, “friendly fraud” made up 30 percent of child identity theft cases in 2010. Because credit checks don’t verify age, identity thieves can freely take out loans, get credit cards and create accounts. The non-profit Identity Theft Resource Center recently helped a young man from Florida who failed a background check to become a police offer because his estranged father had stolen his identity years earlier and destroyed his credit.
How to deal with child identity theft
The Identity Theft Resource Center recommends teaching children about the importance of privacy and the danger of sharing personal information online. All personal information, including Social Security numbers and birth certificates, should be kept in a secure place. If mail arrives in the child’s name, that’s a warning sign that a credit file has been opened. Parents should contact all three credit major bureaus immediately and ask for a credit report. If no credit report exists, the child is likely in the clear. If a credit report surfaces, a security alert must be filed with all the credit bureaus including Equifax, Experian and TransUnion. File a police report using the credit reports as evidence. A police report listing the fraudulent accounts obligates the credit bureaus to remove them from the credit report within 30 days.