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 doubled since 2006 with 21,344 cases reported in 2008. In this tough economic time, it has been predicted that child identity theft will again double in 2010.
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 apply for credit, college, or employment. Some of these child identity theft cases involve split families where one of the parents is the perpetrator with the crime being exposed by the other, unoffending parent. Discovery often comes:
- When attempting to open a savings/checking account or college fund. In this scenario, the unoffending parent discovers that there is already an account under the child’s social security number or that the account is denied as a result of worthless checks on file at ChexSystems;
- 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 an 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 a driver’s license because another individual has a license with their 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 instances that may appear to be identity theft but are not. Receiving a pre-approved credit card offer might upset you as a parent but may only be the pitch of a potential creditor because you opened an account or college fund in your child’s name. 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 semi-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. Call Equifax at (800) 685-1111; Experian at (888) 397-3742; and Trans Union at (800) 916-8800.
A common misconception 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 a 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 relation to identity theft.
If your child becomes a victim of identity theft, you must immediately file a police report. Federal law mandates that credit reporting agencies investigate and correct all identity theft issues. Nevertheless, it all starts with a properly filed police report. Without one, creditors, collection agencies, and/or credit reporting agencies are not required to act upon your complaint.
William E. Lewis Jr., is a credit repair expert with Credit Restoration Consultants and host of “The Credit Report with Bill Lewis” on AM 1470 WWNN, a daily forum for business and financial news, politics, economic trends, and cutting edge issues.