What Is Child Identity Theft?

What Is Child Identity Theft?

Similar to identity theft as experienced by adults, child identity theft is when a fraudster uses a child's personal information, such as their Social Security number, name, address or date of birth, to get credit.

That can include applying for a credit card, renting a home, signing up for utilities, opening a bank account, applying for a loan or receiving government assistance. When child identity theft occurs, it affects a minor under the age of 18 and can negatively impact a child's credit before they've had the chance to build it on their own terms.

How Does Child Identity Theft Occur?

Child identity theft can happen when a thief steals documents, hacks into online accounts or poses as an official requesting personal data. Here are some ways fraudsters get their hands on personal information:

• Phishing scams: Phishing is when thieves use email, a cellphone or a landline to trick you into giving them your personal information. A child under age 18 may be a victim, or a parent may respond to a request for their child's data.
• Hacking: Hackers infiltrate large systems to steal user data. Both small and large companies can be hacked, and if your child has an account with a company that's been hacked, their information may be exposed.
• Theft in the family: Child identity theft can also occur within families. Family members can take important documents and open accounts in children's names. Be careful to secure your child's personal documents in a safe space in your home, inaccessible even to extended family and friends.

Once a thief has a child's personal data, they may open credit card accounts and run up debt they don't repay; apply for loans that end up going into collections or foreclosure; or set up utility or cellphone accounts whose bills go unpaid.

What Are the Warning Signs of Child Identity Theft?

These are indications that your child's identity may have been stolen:

• Offers of credit: Preapproved credit card offers or other correspondence related to credit arrives at your home addressed to your child.
• Tax bill from the IRS: You receive correspondence from the IRS related to taxes your child owes when your child has never been employed.
• Contact from debt collectors or lenders: Collection agencies, lenders or credit card issuers contact your child at your home address to follow up on unpaid bills.
• Credit report with no credit: Your child has a credit report in their name before they've begun using credit. You will have to directly contact each of the three national credit bureaus—Experian, TransUnion and Equifax—separately and follow their processes to determine if your child has a credit report. You will likely need to supply information such as your child's birth certificate and a copy of your driver's license to request this information.

How to Protect Your Child From Identity Theft

While child identity theft is scary, it is also avoidable in many cases. Take these steps to avoid giving fraudsters access to your child's personal information:

1. Limit access to your child's data. Share your child's Social Security number only when it is absolutely necessary, and only with people and agencies you really trust. Before giving out a Social Security number, ask if there is an alternative data point you can share instead.
2. Freeze your child's credit reports. You have the right to freeze your child's credit reports, which can help you make sure no new accounts are opened in their name. Credit freezes stop potential lenders from accessing a credit report, making it nearly impossible for a fraudster to open a new account, even if they have your child's personal information. You need to freeze your child's reports with each credit bureau individually.
3. Educate your child. Teach your child how to spot suspicious activity, like phishing, and how to conduct themselves responsibly online. Explain the importance of keeping their personal data safe and coming to you if someone has asked for their information.

Learn more >> How to Protect Your Child From Identity Theft

What to Do if Your Child Is the Victim of Identity Theft

Here's how to proceed if you've confirmed child identity theft has occurred, and how to limit potential damage to your child's credit:

1. Freeze their credit file immediately. If your child's Social Security number was compromised, you have the right to contact one or all of the three major credit bureaus to freeze your child's credit file and prevent fraudsters from using their information to open credit in their name. You also have the right to request that the credit bureaus remove any bogus accounts from your child's credit report by filing a dispute.
2. Contact financial institutions. If a financial account was opened in your child's name, contact the bank or credit card company. Be prepared with evidence that may be needed to prove that your child is yours and that they did not open the account. Instruct the institution to close the account, and get confirmation in writing that your child did not open it.
3. Secure all personal data. If another aspect of your child's information was taken, like usernames or passwords, make sure they log in to all their online accounts and change their credentials as soon as possible. Check for fraudulently sent emails and messages; hackers may also send malicious emails or messages from compromised accounts.

Once you've taken the appropriate steps to secure your child's credit reports and accounts, report the identity theft to the Federal Trade Commission at IdentityTheft.gov. You can also contact the Identity Theft Resource Center, a nonprofit organization that helps victims of identity theft resolve their cases.

The Bottom Line

Child identity theft is alarming, but often it can also be avoided—and fixed. It's important to take precautions to avoid identity theft both for yourself and for your children. But know that if it happens, there are ways to limit its potential damage, and to strengthen your child's knowledge of credit and online safety throughout the process.