It happens more than you think.
Child identity theft isn’t a new phenomenon, but it is a problem that continues to grow. Experts estimate that 1.3 million children have their identities stolen each year, and half of the victims are under the age of 6. Kids’ credit and Social Security numbers are also 51 times more likely to be abused than adults’ information.
This so-called synthetic identity theft is lucrative and relatively simple to perpetrate. Children are debt-free and have Social Security numbers without loans or credit attached to them, which makes it easy to open fraudulent accounts using their information. If you have no reason to suspect theft until your child is denied a college loan at 18, thieves have a decade or more to take advantage without being detected.
Identity thieves can, of course, be strangers, but family members — from precocious teenagers to former spouses — who have access to your kids’ sensitive information can also create fake accounts. Moreover, credit providers may take an application at face value and fail to check that the name, Social Security number, and birthdate match, so the thief doesn’t need much information to do significant damage.
Laura Bruck, an identity protection expert at EZShield, says parents can look for a number of red flags to catch theft early: credit reports in your child’s name or with his or her Social Security number; unexpected bills or mail addressed to your child; collection calls and IRS letters referencing balances on your child’s account; and criminal charges on background checks. Pre-approved credit offers in your child’s name may also indicate fraudulent activity, though these are often mass mailed using information contained in open public records.
Even if you don’t see any signs that your child’s identity has been stolen, there are a number of preventive measures you can take to prevent it. Remember, it can take years and lots of effort to unravel the mess once it’s made.
Keep Sensitive Information Safe
Take as much care with your child’s personal identifying information as you do with your own. Give out Social Security numbers sparingly, and always inquire as to how they will be used and secured. Understand how much information your child’s school is allowed to disclose to third parties, and in what circumstances, under the Family Educational Rights and Privacy Act.
Leave sensitive documents, including birth certificates and Social Security cards, locked in a home safe, and shred anything that contains personal information before throwing it away. This includes those annoying credit card offers.
Sign Up for Identity Theft Protection
Credit monitoring and identity theft protection may not prevent fraud, but they will help you catch it early and recover more quickly. Look for an identity theft protection service that offers family-wide coverage so you can add your children to your own monitoring package. Identity monitoring covers personal information not included in credit monitoring, so research which option is right for you.
If you go the DIY route, experts recommend pulling your child’s credit reports annually from all three bureaus using their Social Security number. With some exceptions, including potential fraud, your child likely won’t have a credit report—this is good. The ID Theft Resource Center has helpful tips for submitting credit report requests for minors. In some states, parents and guardians are allowed to freeze credit on behalf of children. Consider this extra step if you suspect your child is at risk or can confirm fraudulent activity.
Teach Your Kids about Online Security
You can also empower kids to protect themselves with basic internet safety rules. Encourage them never to post personal identifying information, to avoid communicating with strangers and surfing inappropriate sites, and to let you know if they ever feel uncomfortable. Be honest about the dangers of the internet and help them understand that you are there to keep them safe.
Steps to take as a parent include installing virus protection software and implementing complex passwords that only you know. Set up protective filters, delete saved credit card data, and monitor your child’s online activity. You should also avoid oversharing about your children on social media — thieves can begin to piece together the puzzle using your personal information combined with your child’s.
In light of recent security breaches, it is worth a little extra time and effort to protect your child’s identity and prevent fraudulent activity.