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For all their evil ways, identity thieves cannot be accused of age discrimination: They gladly prey on children and adults alike, and the consequences for children can be even more extensive than those for grown-ups. The steps outlined below can help prevent your children from being victimized.
What Is Child Identity Theft?
Child identity theft is a special case of identity theft involving the criminal abuse of personal information belonging to minors, including Social Security numbers (SSNs), dates of birth and home addresses. The nonprofit Identity Theft Resource Center (ITRC) cites a 2018 study that found that more than 1 million children were targeted for identity theft in 2017, underscoring the significance of the problem.
Crooks can use children's personal data the same ways they do adults', for purposes including:
- Applying for and opening credit card accounts
- Obtaining loans
- Seeking unemployment, Social Security benefits or other government services
- Opening bogus bank accounts for use in fraudulent money transfers
Child identity theft is especially pernicious because children typically don't receive the bank statements, credit card bills and other communications that can alert adults to suspicious financial activity. This means child identity theft can go on for years before it is detected, spawning multiple bogus accounts or loans, all of which can damage the child's credit. While that damage can be undone with time and effort, child identity theft can come to light at a devastating time—when the child's first student loan application is denied, or when the credit check for a first job throws up a red flag, for instance.
Criminals take advantage of the fact that parents—even those who carefully track their own credit and financial histories—may not think to safeguard their children's personal data and credit.
How to Protect Your Child's Identity
Identity thieves constantly devise new schemes for tricking victims into giving up personal information, as well as new means of exploiting personal data. As an example, criminals capitalized on the COVID-19 pandemic with bogus assistance offers aimed at capturing personal information, while also using stolen credentials to falsely claim COVID-relief benefits. Criminal resourcefulness makes it difficult to anticipate every approach fraudsters will use, but a set of basic precautions will go far toward preventing child identity theft.
Consider Security Freezes on Your Child's Credit Reports
There's no reason for most children to have credit reports, since it's illegal for anyone under 16 to apply for a loan or credit card in their own name. Fraudulent loan and credit card applications can generate credit reports, however, and by the time you or the child discovers them, they could be full of unpaid accounts.
You can nip this in the bud by requesting a security freeze for your child at each of the three national credit bureaus (Experian, TransUnion and Equifax). When you request a security freeze, the bureau creates a credit report for your child and then locks it down, so that any lender who attempts to process an application that uses your child's credentials will be denied access to their credit history. This prevents any loans or credit cards from being issued in the child's name. When the child reaches legal age and wants to apply for credit, the freeze can be lifted by contacting each credit bureau individually.
Safeguard Children's Social Security Numbers
You should never share a child's Social Security number with anyone who doesn't have a very good reason for having it—which means it's smart to ask anyone who requests it why they need it. The IRS requires the child's SSN when you're setting up a 529 college savings plan or claiming your child as a dependent, but their day camp and martial arts academy won't really need it. If they insist, you can refuse and seek services elsewhere, or provide the last four digits of the SSN, but beware: Even the "last four" can be useful to identity thieves. Keep your child's Social Security card in a secure place such as a safety deposit box and memorize the number so you don't have to write it down anywhere.
Monitor Your Child's Personal Information
If your child starts receiving credit offers in the mail, or if you see unexpected activity on their email, phone or bank accounts, their personal information may have been compromised. When you first give your children their own phones, advise them that caller ID can't always be trusted, and calls that appear to be from banks or other trusted institutions may be scams.
Although a phone number may seem innocuous, identity thieves can use your child's phone number to get access to accounts. Many companies use a phone number for identity verification, and caller ID spoofing allows identity thieves to make your child's phone number appear when they call one of these companies. They also use automated callers (hoping to get your child to type in or record information), and some may even impersonate institutions and call your child directly.
Pay Attention to Privacy Policies
Practically all organizations that gather data on kids have privacy policies that detail how the child's private information will be used and protected. Reading these policies can help you identify potential risks to your child's information. If in doubt, never hesitate to ask questions, and don't disclose your child's information if you're not comfortable with what you see in the policy.
Use Your Own Personal Information Instead of Your Child's
It's easy to share kids' personal information without thinking about it—and kids often are eager to do so—enrolling in a restaurant's birthday club to get free dessert, for example. And even if retailers don't abuse your child's information, none are immune to data theft that can expose kids' personal info. To protect your child's personal information, attach their accounts to your email or phone number, rather than the child's, to help you pick up on any suspicious activity.
Avoid Oversharing on Social Media
Identity thieves comb social media for personal information—from birthdays and addresses to clues about security questions such as "What's your first pet's name?" or "Where did you go to elementary school?" Minimizing the amount of information you share about your kids, limiting your sharing options to "friends" (rather than "public") and confining your circle of "friends" to people you trust and know personally can reduce the risk of exposing children's personal information.
Monitor Your Child's Social Media and Other Online Activity
Think carefully and do research before you allow a minor child to have a social media account attached to their real name. Insist that they make you part of their shared network so you can monitor what they're sharing and with whom. And keep in mind that your child may have access to the internet and smartphones at school or friends' houses, even if you limit or forbid those activities at home. Explain to your children why you're concerned, and advise them on the kinds of information they should never disclose.
Keep Your Home Safe
A burglary that results in theft of birth certificates, passports or Social Security cards could enable child identity theft. Always lock doors and windows, set an alarm if you have one, and keep valuable documents offsite, in a safety deposit box or in a safe. (A strongbox could protect your documents in case of fire, but a thief could easily take it away.)
Teach Your Children Well
It's important for kids to understand identity theft risks. Find age-appropriate ways to talk to children about the topic. Make them aware that phone calls, text messages and emails aren't always from who they purport to be, and that they should check with you before responding to any of those that seek personal information. Let them know it's OK to hang up on an adult who asks for sensitive information, no matter who they claim to be.
Warning Signs of Child Identity Theft
Detecting child identity theft can be difficult, but there are some signs to watch for:
- Offers for credit cards, auto insurance or other age-inappropriate "junk mail" addressed to your child.
- Unexpected bills addressed to your child.
- Collection notices that arrive by mail or phone, targeting your child.
- Denial of government benefits for your child on the basis that they've already been paid to someone using your child's Social Security number.
- A letter from the IRS saying your child owes taxes. (Phone calls purporting to be from the IRS are almost always scams; the IRS communicates with taxpayers only by mail.)
What to Do if Your Child's Identity Is Stolen
If you suspect your child is a victim of identity theft, your first step should be to check his or her credit reports at all three national credit bureaus, which you can do for free at AnnualCreditReport.com.
Unless you've had credit reports created for purposes of security freezes, your child probably won't have a credit report on file at the bureaus. If credit reports already exist when you request a security freeze you should look into the possibility of fraud:
- Notify all three national credit bureaus that fraud may have occurred using your child's credit report and ask them to investigate.
- Notify the business or financial institution that issued the credit or loan, using contact information that appears on the credit report(s). Let the lender know the account was fraudulently opened in the name of your minor child and ask them to investigate.
- File a police report with your local law enforcement agency.
- File a fraud report with the FTC online or by calling 877-438-4338.
Experian has more resources on fraud and identity theft to help you and your family stay informed.
Child identity theft is an ugly side effect of the information age, but attention and caution can help prevent it, or minimize the damage when it occurs. Taking prudent precautions such as applying a security freeze or using a family identity protection program such as Experian IdentityWorksSM can help keep children's personal information secure.