A new study from Javelin Strategy & Research shows that one million U.S. children fell victim to identity fraud in 2017.
Financial losses stemming from those fraud incidents against children were significant. According to Javelin, total losses amounted to $2.6 billion and more than $540 million in “out-of-pocket” costs linked to child-identity theft were lost.
“Child-identity fraud is a serious problem and is frequently overlooked as the public focuses on high-profile breaches involving the personally identifiable information of adults,” says Al Pascual, head of fraud and security at Javelin Strategy & Research. “Child-identity fraud has unique characteristics that make it particularly hard to prevent, though there are steps parents and guardians can take to help keep children safe.”
For parents, the route to safety starts with education, some old-fashioned due diligence, along with a handful of useful data security technology tools, experts say.
Here’s how to protect your young loved ones against I.D. fraudsters – in the short term and in the long term.
Get your kids up to speed early on identity-fraud risks. “Start training children to protect their identity in the digital world when they are young,” Javelin sates. “Early training for children to properly manage their online activity will instill habits invaluable in their adulthood, reducing their risk of victimization early and later in life.”
Watch for signs your child is being bullied. Javelin says there is a “strong relationship” between fraud and bullying. “Children who are struggling with these issues may also be oversharing personal information in an anonymous environment,” the firm states in its report.
Delete accounts that your child and/or your family no longer uses. “This will help to reduce your potential for being breached,” says Jason McNew, an Air Force veteran who previously worked for the White House Communications Agency. “If you leave abandoned accounts everywhere, you will get breached.”
Strengthen your family password policy. “If you reuse passwords across accounts or at school, you will get breached,” says McNew. “If you use weak passwords, you will get breached. If you do not change your passwords every few months, you will get breached. Also, don’t allow your browser to remember passwords for your most important accounts.”
Monitor kids’ online activities. This point cannot be stressed enough, McNew adds. “There are several very good monthly security services that are designed to help parents protect their kids online, in numerous ways,” he says.
Watch out for signs your child’s I.D. has been breached. Identity thieves can be strangers who collect information online or by going through your trashed mail. They can also be people you know who have access to your child’s information – family members, friends, and administrators, says Emily Patterson, a security expert at ASecureLife.com. “Parents should look out for red flags like unexpected bills, collections, or IRS contacts that reference their child’s name as well as a lot of pre-approved credit offers,” Patterson states. “These don’t always indicate identity theft but they can be related.”
Order a credit report on your child’s behalf. To set up that credit report, contact any one of the three major credit agencies (preferably, all of them). Each has its own wrinkle on what it will do in setting up and, if needed, freezing your child’s credit report.
“For example, Experian doesn’t create a credit file for a child unless this is required by law or unless they become a victim,” says Robert Siciliano, an identity theft expert with Hotspot Shield, in Boston, Mass. “At that point, parent gets a free copy of the child’s existing credit report for a small fee, unless the parent can prove the child’s identity was compromised.”
“Equifax, on the other hand, will provide a free credit report on your child if you need to get the credit freeze,” he adds.
If identity theft occurs, implement a credit freeze. A credit freeze is a tremendous tool for fighting identity theft because it prevents an identity thief who has your child’s Social Security number from accessing his or her credit report for purposes of establishing credit in your child’s name.
“Unfortunately, credit reporting agencies don’t generally permit credit freezes for minors, except in the 27 states that have laws permitting parents to put credit freezes on the accounts of their children,” says Steven J.J. Weisman, a white-collar crime professor at Bentley University and a nationally recognized expert in identity theft. “If you live in one of the states that has a child identity theft law and have minor children, contact each of the three major credit reporting agencies, Equifax, Experian and TransUnion in order to freeze your child’s credit.” You’ll need to set up a credit report for your child beforehand, Weisman says.
Protect your child’s Social Security number at all cost. Identity thieves really want your child’s Social Security number, says Robert Siciliano, an identity theft expert with Hotspot Shield, in Boston, Mass. “If I.D. thieves get this number, they can do a lot of damage, including buying a car, renting an apartment, opening a credit card account, or getting a mortgage,” he notes. “The Social Security numbers of children are great for the bad guys because kids generally have clean records, and crooks can use these numbers to obtain credit. Kids usually don’t check out their credit reports until they go to college or buy a car or home. So, the crook can get away with it for years.”
For parents, it’s time to get serious about stopping child ID theft in its tracks. Use the tips above to keep I.D. fraudsters out of your child’s life, once and for all.