Identity thieves are getting much more advanced in how they steal people’s information and they are targeting a much younger crowd: children.
“With children, it’s the crime of opportunity and is often committed by someone in the family or close to the family,” says Ken Chaplin, senior vice president at Experian’s ProtectMyID.
Children were targeted by scammers 35 times more often than adults, with 15% of the victims under the age of five, according to AllClear ID. Stealing a child’s identity is much easier than stealing an adult’s and it’s a clean slate, making the information much more coveted.
The crime tends to go undetected until victims turn 18 and apply for a student loan or car loan and discover they already have a credit file.
All it takes to create a fraudulent identity is a Social Security number, birthday, addresses, and parents’ names. Children are issued Social Security numbers at birth since parents need this information to claim the child as a dependent on tax returns. If parents aren’t careful with this information, there’s an opportunity for a thief to use a child’s clean record, says Chaplin.
Since the Social Security Verification Service can only be used for W-2 reporting purposes, banks verify Social Security numbers, names, and birthdates with credit bureaus, says Tom Shaw, vice president of Financial Crimes at USAA.
“Since there’s no file created [for a child’s Social Security number], someone can attach any name and birthdate with a Social [Security number],” says Shaw . Having a mobile phone or utility bill under this fake identity helps to establish credit. “When a synthetic identity has been created, that’s when somebody can apply for loans and do real damage. All financial institutions rely on that first credit file that’s created.”
There are red flags to help parents know their child’s identity may have been compromised—here’s what they need to be on the look for:
You receive credit card solicitations addressed to your child. “Credit card offers are a big sign that there’s been some activity in your child’s name,” says Chaplin.
Collection agencies call asking for your child. Along with solicitations, calls from collection agencies asking for your child or someone with a different name who has the same last four digits as your child’s Social Security number are also reasons to suspect there may be a problem, says Shaw.
You receive an IRS notice that someone else used your child’s Social Security number. This could be a sign that someone else is using your child’s Social Security number at a job or is claiming your child as a dependent, says Bob Welther, assistant vice president of risk consulting at ACE Private Risk Services.
Parents should be proactive to help protect their child’s identity, and should instill strong security practices with their kids so they know what information not to share.
Ask. Ask. Ask. “A lot of times, a doctor asks for a Social Security number right off,” says Shaw. Experts suggest asking why they need a Social Security number, whether they can use the insurance subscriber ID or some other unique identifier instead, and how that information is being stored. “How secure is your child’s Social Security number written on a piece of paper locked in a file cabinet?” says Shaw.
Find out who has access to your child’s information. A home address and birthday can also be used to glean someone’s identity. Along with a mother’s maiden name, someone can begin to create a profile that’s used for identity cards or memberships that you have no control over. “The gain isn’t always financial but could be job related, medical related, or some kind of fraud,” says Chaplin. If your address and child’s birthday is included in a school directory, you may want to opt out of being included.
Know who’s working in your house. Since anyone in your home can access your information, “it’s critical to do credit checks and background screening on anyone working in your home on a regular basis, financial advisors, or anyone else who has access to your personal information,” says Welther.
Check your children’s records. Using certified mail with a return receipt, parents can send letters to the credit bureaus explaining who they are and request a copy of their child’s credit file with copies of their child’s birth certificate and Social Security card, says Welther. “If everything’s good, you’ll receive a letter saying that there’s no credit file.” He also suggests writing a letter to the Social Security Administration asking whether there’s a job history associated with your child’s Social Security number.
Shred documents. “Anything with personal identification should be shredded with a cross[-cut] shredder,” says Shaw. “Dumpster diving is still prevalent.”
Store documents in a safe place. Store birth certificates and Social Security cards the same way you do valuables, says Chaplin. “Your desk and home office isn’t always a safe place. In the same way you wouldn’t leave a $50 bill on your counter, don’t leave this information around.”
Be prudent with social media. Experts say children should mark their privacy settings to “Friends Only,” and never disclose birthdates. Parents should also be very cautious of whom their child adds as friends. “Make sure you know who your child’s friends are online just like you know who their friends are in real life,” says Welther. He recommends checking whether your child has access to the Internet through mobile devices and public computers. Know whether those devices are secure and teach them to log out when they’re done with a site and to clear the history on any public computers, says Welther.
Install protective software on your home computer. “If parents don’t set up the right education for children, they won’t know the ramification of their actions,” says Keith Gordon, senior vice president, Fraud and Enrollment Executive at Bank of America for Online and Mobile Channels. He recommends installing antivirus and anti-malware software that prevent viruses and other malicious attacks on your computer that can compromise your family’s information. “If your computer is infected with malware, the whole intent is to steal your information that you may be entering online,” says Gordon. “The point of entry onto that computer is a random click on your email. Phishing is still a real threat.”
Be wary of what you post on the Internet about your children. “Now, some parents, as their children are born, are reserving email IDs, Facebook accounts, and URL or domain names so their children have these when they’re older,” says Gordon. “Fraudsters are becoming much more patient gathering data to be able to build an identity on someone.” Although many people think dates of birth and email addresses are benign pieces of information, a fraudster can use this information to phish parents for a Social Security number for that child. Many people would likely fall for this during tax time, says Gordon.
Before a child is born, Welther cautions against posting birth announcements and registries on the web with full names or the child’s gender. “Before a baby is born, [a thief can] create a birth certificate and get a Social Security number on their own,” says Welther.
Work with services to help keep your information secure. “Your insurance company may have services that can help you monitor your and your child’s identity,” says Welther. If you’re a victim of identity fraud, these services can help to rectify the fraud and cover damages as attorneys and financial advisors become involved. “It can take weeks to months to years to clear an identity fraud depending on what’s been done with that identity,” says Welther. Credit bureaus and All ClearID also offer similar services to protect against identity theft.