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How to Protect Your Minor Child From Identity Theft

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A new variation of identity theft has substantially gained in popularity over the last four years - child identity theft. Child identity theft occurs when a child's identity is used by another person for the imposter's personal gain. The perpetrator may be a family member or someone known by the family. It could also be a stranger who purposely targets children because of the lengthy time between the theft of the information and the discovery of the crime.  The Federal Trade Commission says child identity theft has tripled in the past three years.  The FTC reported 8500 cases in 2003, more than 14,000 in 2005, and 26,300 in 2006.

Children are often easy targets because thieves get an eight to ten year head start on them. In fact, most children who have had their identities stolen are not aware of it until they someday apply for credit, college, or employment.  Parents or relatives are usually the first to notice that something is not quite right. Some of these child identity theft cases involve split families (one of the parents is the perpetrator and the crime is exposed by the other, unoffending parent). Discovery often comes:

  • When attempting to open a savings/checking account or college fund for the child. In this scenario, an unoffending parent discovers that there is already an account with that social security number or that a new account is denied due to prior worthless checks on file at Chex Systems;
  • When numerous pre-approved credit offers come in the mail bearing the name of the child;
  • When credit cards, checks, invoices or bank statements (not opened by a unoffending parent as a joint holder) are received bearing the name of the child;
  • When collection agencies call and/or send letters about accounts not opened by the child;
  • When a child is denied the privilege of obtaining a driver's license because another individual has a license with that social security number. The imposter may even have accumulated traffic citations in the child's name;
  • While going through papers during a divorce proceeding or while straightening up the house (Parental identity theft)
  • When a law enforcement officer knocks at your door with a warrant for the arrest of your child.

There are some cases that appear to be identity theft but are not. Receiving a pre-approved credit card offer in your child's name might upset you as a parent. However, it might only be an innocent marketing tool sent by a potential creditor because you opened a college fund for your child. A quick check of credit reports will help sort out the truth. Currently, all three credit reporting agencies have automated systems. You should contact them annually to request a credit report on your children. If you are advised that no credit report exists, your child is safe for the time being.  Equifax can be contacted at (800) 685-1111; Experian can be contacted at (888) 397-3742; and Trans Union can be contacted at (800) 916-8800.

A common misconception of most individuals is that creditors and credit reporting agencies have a method of verification when it comes to the age and identity of an applicant.  Since most creditors rely strictly upon the written application when rendering a credit granting decision and the age of an individual becomes "official" with a credit reporting agency upon the first application for credit, said reliance can be fatal in the area of identity theft.  This is a fault within our credit reporting system that needs to be rectified if we are to reduce the incidence of child identity theft.

If your child is the victim of identity theft, you should file a police report with your local law enforcement authority immediately.  Federal law mandates that the credit reporting agencies investigate and correct all identity theft issues.  Nevertheless, it all starts with a police report.  Without the police report, creditors and/or credit reporting agencies are not required to act upon your complaint.