3 Ways to Protect Your Child Against Identity Theft
"It's terrifying to think that your child or even unborn child's identity could be comprised for the sole reason that they have a clean record," Stephen A. Cox, president and CEO of the Council of Better Business Bureaus, said in a statement. "It is extremely important that parents take the necessary precautions to ensure the safety of their child's precious and helpless identity."The BBB says hundreds of shady businesses are digging up inactive Social Security numbers online -- most of which are assigned to children under the age of 18 -- and peddling them under different names to help scammers establish fake credit lines.
According to a 2011 report from Javelin Strategy and Research, 8.1 million Americans became victims of ID theft in 2010, resulting in the loss of $37 billion. And while juvenile identity theft is difficult to measure, since it can be years before the damage is detected, Debix, an identity theft monitoring company, reported 4,000 cases in 2010, out of a pool of 40,000 children.
Underage victims of these scams may one day find themselves entering adulthood loaded with mountains of debt, but vigilant parents can avert trouble by heeding warning signs and taking the following steps to secure their child's identity:
1. Recognize red flags
Watch out for signs that someone may be using your child's identity for a shopping spree, which include your son or daughter receiving pre-approved credit card offers or calls from collection agencies.
2. Know what to do if you suspect your child is an identity theft victim
The FTC advises parents to check their child's credit report on their 16th birthday, giving them time to correct any errors before the child comes of age and obtains a credit card, or goes off to college and applies for financial aid.
If suspicious activity is detected, parents need to contact all three major credit bureaus -- TransUnion, Experian and Equifax -- and immediately request a report. You may also want to consider freezing your child's credit until you are able to wipe their slate clean again.
3. Learn how to obtain your child's credit report
Although adults can obtain their credit reports using the congressionally mandated free credit report website, annualcreditreport.com, it can't be used to check on anyone under the age of 13. For parents with children under 13, the easiest way to obtain your child's records is through TransUnion -- but don't get roped into buying other credit-related services you don't want or need. If something turns up on the TransUnion report, be sure to follow up with the other two major credit bureaus (Experian and Equifax).
For more information on securing your identity, visit the Better Business Bureau's web site. The Federal Trade Commission also offers a wealth of information, including a website dedicated to educating consumers about how to avoid identity theft.