How to protect your kids — and their future credit — from identity thieves

A college-bound teen applying for financial aid found out she had a long — and appalling — credit history created by crooks who had stolen her Social Security number when she was a baby. According to the nonprofit Identity Theft Resource Center, it took so long for the teen to clear her name that she never caught up to her peers in college.

She is far from alone. Last year, nearly 14,000 identity theft cases reported to the Federal Trade Commission involved people age 19 and younger. Credit reporting agency Experian estimates a quarter of kids will be victims of identity fraud or theft before they turn 18.

“Child identity theft is something all parents need to be alert for,” says Eva Velasquez, president of the Identity Theft Resource Center. “Thieves target children because they have clean credit reports where they can take advantage of the credentials without it going noticed for a long period of time.”

So where do the bad guys obtain your child's personal information? Data breaches are the primary method; 2017 was a record year for stolen financial information, according to Gemalto, a digital security firm that tracks breaches. Anywhere you provide your child's Social Security number — doctor's offices, hospitals, schools, camps, sports leagues and so on — creates a potential point of vulnerability.

On a smaller scale, some identity thieves harvest this data by committing burglaries of homes or cars, or even snatching purses. And some child identity theft is committed by family members or close associates with access to a child's information. Foster children are at particular risk, because so many adults are involved in their lives.

Once identity thieves have a child's Social Security number, the internet makes it easy to piece together the rest of the information required to open bank or credit accounts. A child's date of birth, city of birth, mother's maiden name, etc., can often be found simply by scanning Facebook. Identities complete with all of these details, called “Fullz” on the dark web, a shadowy network where criminals sell guns, child porn and identities — go for far more than adult identities. With fake identity in hand, thieves can apply for credit cards, car loans and mortgages, rent apartments, set up utilities, have surgery or obtain government benefits. By the time the child or parents catch on, the thieves may have generated so much havoc that the victim is unable to obtain credit for years.

What to do

Here are several steps you can take to try to keep your child's financial identity from being stolen in the first place.

• Provide less information. Refuse to provide your child's Social Security number and consider holding back information such as middle name and date of birth, unless essential. If a school, doctor or government entity insists, ask them what they do to secure that information. See if you can give your identifying information instead of theirs, since it is easier to monitor your own credit file for problems.

• Protect physical information. Don't carry documents containing your child's Social Security number or other information in your wallet. Instead, keep them locked up at home or in a safe-deposit box. Shred sensitive documents before throwing them away. Use a locked mailbox for incoming and outgoing mail.

• Use caution on social media. Don't post personal information online, such as birth dates or cities of birth, that would be of value to identity thieves. And once your son or daughter is old enough to have an account of his or her own, discuss online security with them and monitor their social media use.

• Consider creating/freezing your child's credit file. The three credit bureaus, Equifax, Experian and TransUnion, may establish a credit file for your child at your request. At least 23 states then allow you to freeze that file, so outsiders can't open bogus accounts in your child's name. According to the Identity Theft Resource Center, this step requires great responsibility: You must protect the PIN needed to unfreeze your child's account and make it available when the child is ready to start using credit.

Red flags

Even if you are vigilant, however, your child could be a victim of identity theft. Here are red flags:

• A credit report exists. Children should not have credit reports unless you have added them to your accounts. Check with the three major credit bureaus when they are about 16 years old, which will give you time to troubleshoot before they become adults.

• Your child is receiving credit cards or offers. Sometimes crooks mess up and credit cards they have opened are routed to your child instead of to them.

• Your child is receiving bills/collection notices.

• You are having problems obtaining government benefits for your child. Sometimes, the bad guys have already applied for those benefits.

If there's a problem

If you discover a problem, it's important to strike back against child identity theft swiftly and completely. Here are the steps to take, according to the Federal Trade Commission.

• Report to the credit bureaus. Ask the three bureaus to remove all information created fraudulently, from inquiries on accounts to collection notices. Request that they put a credit freeze — or at least a fraud alert — on your child's account.

• File a police report. This step generates paperwork you may need to persuade businesses at which the criminals opened accounts to do the right thing (below).

• Inform businesses that these accounts are illegitimate. Ask them to close the accounts and mark them as having been generated by child identity theft.

• File a complaint with the Federal Trade Commission. The FTC is the nation's repository of identity theft complaints. Its ID theft website will generate an action plan with further recommendations for you.

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•Leamy is a 13-time Emmy winner, a 25-year consumer advocate for programs such as “Good Morning America” and host of the podcast “Easy Money.” Connect with her at leamy.com and follow her @ElisabethLeamy.