New law will make it easier to check your child’s credit: Why you should

In addition to monitoring their own credit reports, parents can now watch over their children’s files, as the theft of minors’ identities proves to be a prevalent, and costly, challenge.

Continue Reading Below

As part of a law developed in response to the far-reaching Equifax hack that took place last year, the government will make it easier, and free, for parents to check on and freeze credit files bearing their child’s name.

Parents can call the three main credit-reporting agencies – TransUnion, Experian and Equifax – to check whether their child has a credit file, which generally should not be the case.

The new measure will also allow adults to check their own credit files – and freeze and unfreeze them an unlimited number of times – at no cost. It goes into effect Sept. 21.

Experian estimated that roughly 25 percent of children will fall victim to identity theft schemes before they become an adult, as reported by The Wall Street Journal.

Meanwhile, more than 1 million children were the victims of identity fraud or theft last year, according to a survey by Javelin Strategy & Research. About 66 percent of those victims were under the age of 8.

Theft of minors’ identities resulted in cumulative losses of $2.6 billion, as well as out-of-pocket costs for families totaling $540 million. Javelin also estimated that 60 percent of minor victims personally know the perpetrator.

By targeting children, a criminal taps into a blank credit slate, which can have a higher likelihood of going undetected for a longer period of time. Unless parents monitor their children’s accounts, breaches can often go unnoticed until a child attempts to take out a student loan or apply for a credit card.

In fact, criminals were able to steal about twice as much from children than adults – at about $2,300 on average –according to Javelin.

According to the Federal Trade Commission (FTC), minors’ Social Security numbers can be used by fraudsters to apply for credit cards, government benefits, or even to rent an apartment. Warning signs include being turned down for government benefits because they are being paid to another account using your child’s Social Security number, getting a notice that your child didn’t pay income taxes and receiving collection calls or bills for products or services you didn’t receive.

If you detect fraud on your child’s account, the FTC advises that you immediately contact each credit reporting company and each business where the information was used fraudulently. You can also ask that a fraud alert be put on your child’s credit report. You should file a report with the FTC.

Overall, 16.7 million people had their identities stolen last year, Javelin reported, a figure that was partly boosted by the massive Equifax breach, which compromised the personal data of more than 147 million Americans.