Children are appealing targets for criminals seeking a clean credit history. Find out how child identity theft happens, how to spot it, and what strategies you can use to help prevent it.
In our increasingly digital world where personal data is currency, children have become unsuspecting targets of a growing epidemic: identity theft.
Once considered a crime primarily affecting adults, child identity theft is now a concern for families across the globe. Children’s identities are particularly appealing to fraudsters because they’re considered a clean slate.
Since children don't typically have credit reports, criminals often operate under the radar for many years, wreaking havoc before victims even reach adulthood.
How child identity theft happens
Identity thieves use a variety of techniques to get kids' personal information like name, date of birth, and/or Social Security number — all of which can be used to open fraudulent accounts and commit other crimes in their names.
Often obtained from sources like school records, medical records, or even from data breaches affecting educational institutions or healthcare providers, stealing a child's information is becoming more and more common.
Data breaches: Educational institutions and healthcare providers, which collect vast amounts of personal data on minors, are often targets of cyberattacks (in fact, 2023 was a record-breaking year for the number of breaches in educational institutions and the number of records impacted). When these systems are breached, sensitive information like Social Security numbers and birthdates can be exposed.
Family theft: Unfortunately, sometimes identity theft is committed by someone the child knows, such as a family member or acquaintance who has access to the child's personal information.
Scams: Say you or your child mistakenly provide personal information to someone claiming to be from their school or a government agency – but it's really a scammer on the other line. They may then use that information to commit identity theft. "Our children are immersed in the digital age, and that's their future, so they're more vulnerable than ever," says Vera Tolmachoff, Senior Restoration Manager at Allstate Identity Protection.
Synthetic identity theft: This method involves combining a child's Social Security number with a false identity to create a new, synthetic identity. These “identities” can be used to open fraudulent accounts or lines of credit.
Signs of child identity theft
The sooner you realize your child's information is being misused, the sooner you can work to minimize the damage.
"Oftentimes, parents don't know about breaches or identity theft until their kids are older, emphasizing the importance of proactive monitoring," says Tolmachoff. "In some cases, parents never find out someone has stolen their child's identity, and their child, now an adult, only realizes it when they apply for credit."
Watch for these signs that your child's personal information is being misused. Then, act swiftly.
Collection calls or notices of unpaid fines: Are you receiving calls or notices about fines or overdue bills in your child’s name? Someone may have been using their information to make fraudulent purchases or obtain a license.
Denial of government benefits: If your child is denied government benefits like healthcare or nutritional assistance, it could be because someone is already using their information to access benefits.
IRS notices: If an IRS notice claims that your child owes unpaid taxes, or that their Social Security number has been used on a tax return, it could be a sign of identity theft.
Student loan denial: If your child is denied a student loan due to their credit, it’s possible that someone may have already used their information to create and abuse a fraudulent credit history.
What to do if you suspect child identity theft
If you suspect your child has been a victim of identity theft, contact the credit bureaus (TransUnion, Experian, or Equifax) to determine if there is a credit file in their name.
Verifying if your child has a credit file could serve as an indicator of potential identity theft. The credit bureaus can help you perform a credit report check, add a fraud alert, or implement a security freeze on your child’s credit.
Next, contact the companies where the fraud occurred and inform them that someone has opened an account using your child’s information. You can ask them to close the account and provide you with written confirmation.
Finally, make sure to report the fraud to the Federal Trade Commission. They track these types of crimes and work on developing strategies for combating them.
If you’re a member of Allstate Identity Protection, you can contact our Customer Care team for 24/7 support and rely on our fully managed recovery process.
Protect your child from identity theft
In light of these risks, parents and guardians should take proactive measures to protect their children's identities before fraud occurs. Some initial steps to take are:
Monitor financial accounts. Regularly monitor any accounts opened in your child's name for suspicious activity, even if they're inactive.
Limit sharing of personal information. Be cautious about sharing your child's Social Security number and other sensitive information, especially online and with institutions that may not have strong security measures in place.
Educate children about online safety. Teach your children about the importance of safeguarding their personal information online and how to recognize potential scams or phishing attempts.
As technology continues to advance and our lives become increasingly interconnected, the threat of child identity theft looms larger than ever before.
But the more you know about this issue and take action to protect your kids' info, the more you can mitigate risks and ensure a safer digital environment.
