Protecting Your Children From Identity Theft

Even though you think it's never going to happen to you, identity theft can happen to anyone - including your children. That's a scary thought, but luckily you can take steps to prevent it. Here's Shannon's flashback Friday post with great tips.

Identity theft is a growing problem across the nation. Did you know that even your kids are at risk, too? Your child’s Social Security Number (SSN) can be used to access public benefits, apply for bank accounts and credit cards, open up utility accounts, and even apply for a place to rent. Why are children targets? Because it can be years before the theft is even discovered. And by that time the victim’s credit is trashed – only discovered by applying for their own checking account or credit card and being turned down due to bad credit. Cleaning up credit from identity theft can take years of work. Here’s what you can do to protect your child from being a victim and what to do if you discover your child has already become a victim.

An Ounce of Prevention

The best protection against identity theft and fraudulent use of your child’s SSN is to keep child’s paper and electronic records that show his or her personal information in a safe location. If a third party wants their personal information (like a doctor’s office), ask why it’s necessary and how it will be protected. Request that only the last four digits of their Social Security Number be used or better yet, an entirely different “identifier.”

It’s comforting to think that your child’s information is safe within your home, but be aware that the majority of child identity theft is committed by relatives or close friends of the family. When folks are in a financial crisis, some may resort to desperate measures. A parent, relative, or friend using a child’s SSN to open a cell phone account might seem like a convenient solution to an adult’s credit issues. However, it is setting up the child for a lifetime of credit issues and is no less fraudulent than if a stranger does it. Of course, your child’s information could also be compromised if there is a theft in the house, a breach in security at school or doctor’s office, or your purse or wallet is stolen and their information is in it. Keep that information locked up.

Know the Warning Signs

There are several signs that someone may have misused your child’s SSN:

• He or she may be turned down for government benefits because they are already being paid to another account using your child’s SSN.
• He or she could get a notice from the IRS saying your child didn’t pay income taxes or that his or her SSN was used on another tax return.
• Your child is receiving collection calls or collection bills addressed to them. It’s pretty unlikely your three-year-old has a smartphone without you knowing about it. And even if he or she did, it wouldn’t be in your child’s name.

You may want to check out your child’s credit report when they turn 16, even if you don’t suspect identity theft. This will give you and your child a couple years to take action and clean up his or her credit report of any fraudulent activity. You can get your child’s and your credit report for FREE once per year from all three credit reporting agencies through AnnualCreditReport.com.

Know What To Do

If your child’s information has been compromised, the first thing you will want to do is contact each of the three nationwide credit bureaus - Experian, Equifax, and TransUnion. Ask for a manual search of the child’s file (but remember to get FREE credit reports, always use AnnualCreditReport.com). They will search for files using the child’s name and SSN and for files related only to the SSN. You will likely be required to provide copies of your child’s birth certificate, Social Security card, and your driver’s license, government issued ID, or copies proving you are the child’s legal guardian. Make sure you send it via certified mail with a return receipt so you obtain verification it was received.

If you find incorrect information on your child’s credit report, dispute the information directly with the credit bureau that is reporting it. Then, put a fraud alert on your child’s file. You may even want to consider a credit freeze, which would make it impossible for anyone to access your child’s credit report. You will also want to place an Identity Theft report.

Know Where To Go for Help

The leading source of information on identity theft is the Federal Trade Commission (FTC). You can learn more about identity theft and how to file a report as well as get tips on teaching your kids online safety and how to protect their identity. You may also want to check out your state’s Attorney General AG) website. Click here to find that website.

Finding out your child has been the victim of identity theft can bring on a wave of emotions and might make it difficult to figure out your next steps. If you need additional support or advice, LSS Financial Counseling can help. One of our counselors will assist you in reading your child’s credit report, make a plan to get incorrect information off of your child’s credit, and help you set up a credit freeze on your child’s report. If you have questions for a counselor, email us at [email protected].

LSS Financial Counseling empowers people to manage their debt, achieve financial goals, build savings. Give us a call at 888.577.2227 to schedule a financial check-up or get your suipport online. Don’t wait to improve your financial future – take action today!

Author Shannon Doyle is a Program Manager for Partnerships and FInancial Education with LSS Financial Counseling.