Allowing our children the innocence of their childhood is paramount to us as parents. Because our children are pretty much the center of our universe, we want to do everything in our power to keep them safe and to safeguard their futures. In this information age, identity theft has become global in its reach and can have devastating consequences for our children’s futures if we’re not vigilant from the day they acquire a Social Security number.
Why are our kids, the very people we most want to protect, so vulnerable? Because they have unused, unblemished credit profiles. Richard Power, Distinguished Fellow, Carnegie Mellon CyLab, recently published the first ever child identity theft report based on identity protection scans of over 40,000 U.S. children. It is extremely alarming that 10.2% of the children in the report had someone else using their Social Security numbers. That figure is 51 times higher than the rate for adults of the same population.
We take so many steps to protect our children. But how often do you check their credit report? “Check my kid’s …credit report?,” I can hear you say. “She is only seven! She doesn’t even have her front teeth yet, let alone a credit card! There are so many years to go before we need to worry about that. Right?”
Unfortunately, no. Because children have untouched and unblemished credit records, they are highly attractive targets. Child identity theft is profitable, hard to detect and a nightmare to recover. Thieves steal a child’s identity early on, nurture it until they have a solid credit score, and then abuse and discard it. If it’s not discovered in time, fraudulent use of your child’s identity could mean the loss of educational and job opportunities and starting off adulthood at a serious disadvantage with someone else’s bad credit in her name. All an identity thief needs to ruin your child’s bright financial future is her name and Social Security Number.
“Shouldn’t my child’s age show up on any credit background check, shouldn’t the merchant recognize that the person in front of them buying a car on credit isn’t seven years old?” you ask. Yes, it should, but the people screening the credit report rarely give it the time and care necessary to detect fraud.
All too often, background checks involve simply matching the name and the Social Security number provided. This leaves doors wide open for scandalous minds to wreak havoc on your child’s perfect credit. The most unsettling part is that the age of the applicant (in this case, the person posing as your child) becomes official with the credit bureaus upon the first credit application. This makes clearing a sabotaged credit record even more difficult because you have to prove to the credit bureau that your child is only seven and isn’t responsible for thousands of dollars of debt.
In no time at all, your child could have a maxed out credit card, unpaid bills and a huge mortgage for beachfront property across the country. You might not discover the illegal purchases until your child opens a bank account, applies for a job, tries to get a driver’s license or enters college. At that point, you are left with the time-consuming dilemma of cleaning up someone else’s fraudulent mess. If only clearing up a credit report was as easy as cleaning up after your kids.
Do the gaping holes in our current credit system and the audacity of criminals leave you enraged? They should. It is imperative that you use your anger as fuel to protect and prepare your children’s future before it is too late. In Part II of this series, we will talk about the specific steps to take in order to protect your child from identity theft.
John Sileo lost almost a half-million dollars, his business and his reputation to identity theft. Since then, he’s become America’s leading keynote speaker on identity theft, social media exposure and weapons of manipulation. His clients include the Department of Defense, Pfizer and Homeland Security. To learn more, visit ThinkLikeASpy.com.