If you’re thinking “this couldn’t happen to my child,” think again! Let’s look at
Who Does This?
The identity thief is not always a stranger. In many cases, it’s a relative with bad credit who takes advantage of a child’s pristine credit. Conveniently, these family members generally have access to the information necessary to maximize the fraud with little attention.
This seems absurd, but imagine a parent who is strapped for cash, has a bad credit score and needs to buy groceries. In this case, short-term thinking blinds the relative or friend to long-term consequences. In other instances, the child’s future is not taken into consideration at all.
Frankly, it doesn’t take much to get the crime underway; all a criminal needs is the child’s name and Social Security Number. These pieces of personal information are exposed in a variety of ways:
- When registering for daycare, schools and recreational sports
- On medical, dental and hospital records
- When joining organizations like the Girl Scouts, Boy Scouts, etc.
- When the above information is permanently stored and accessed by volunteers or employees
- When one of the above organizations is breached by a hacker or malicious software
- When an adult befriends your child on a social networking site (MySpace, Facebook) and eventually socially engineers private information out of them
The Three Basic Types of Child Identity Theft
Child Identity theft generally falls into these 3 categories:
- Financial identity theft occurs when the name and Social Security Number is used to establish new lines of credit.
- Criminal identity theft happens when the criminal uses the child’s identity to obtain a driver’s license or substitutes the child’s identity if caught in a criminal act.
- Identity cloning entails using a child’s identity (via information collection or a black market ‘purchase’ of personal information) for financial, criminal and governmental purposes. The most common form of cloned identity theft is committed on behalf of undocumented workers looking for an identity that will keep them working in this country.
For parents, cleaning up the disaster of identity theft for their children is costly and incredibly time consuming. Getting a new Social Security Number is almost impossible, and rarely the best option.
Taking steps right now to protect your child from this horrible crime is one of the greatest investments you will ever make in their financial and emotional future.
Tomorrow, I will cover the steps on How to Protect Your Children from Identity Theft.