Most parents are likely to be aware that there is a risk that they could fall victim to identity theft; they may not be aware, however, that their children are an even choicer target for fraudsters. Virtually nobody checks to see if their children have a credit history, since children do not apply for credit. Thus, identity theft can go undetected for 10-20 years until children grow up and discover their ruined credit scores.
The Hawaii Better Business Bureau’s Director of Marketing, Jason Kama, estimated that child identity theft can be as much as 50% higher than identity theft from adults. Most children do not have access to a loan, a credit card or other financial benefits; this does not mean that they cannot fall victim to this crime—in fact, this makes them more vulnerable.
In addition to the unlikelihood of discovery, criminals target children for identity theft because they have a clean credit file. Using a child’s name, a fraudster may be able to take out a loan, apply for a credit card and run up thousands of dollars’ worth of debt.
Ronald K. Noble, founder of RKN Global, urges parents to be diligent about protecting the personal information and financial reputation of their children. Parents or care-givers may wish to check their child’s inbox regularly to see if they have received unsolicited mail.
Parents and care-givers may wish to start reducing the amount of times their child’s social security number is used. Although many agencies use social security numbers responsibly, asking how the information will be used can help to reassure parents and care-givers that the information will be kept safe, or, on the other hand, highlight potential security issues. There may be incidences where other forms of identification could be used, reducing the likelihood of a child’s social security number being stolen and used for fraudulent purposes.
According to one estimate, 1.3 million children in the United States are affected by identity theft every year. While security services may never know exactly how many children are affected this way, making annual checks to see if a child has a credit report could potentially highlight any fraudulent activity. No child should have a credit report, as loans and credit cards are only given to adults. A yearly check could highlight any activity and potentially quash it before a child’s financial future is compromised.