By JILIAN MINCER
November 21, 2007; WSJ
NEW YORK -- While only a small percentage of identity-theft victims are children, the number is growing, and the impact on the victim's credit, confidence and relationships could be devastating.
The crime can go undetected for years and is most commonly committed by a family member, according to a report released this week by the Identity Theft Resource Center, a San Diego nonprofit organization.
Fortunately, simple precautions, such as keeping your child's Social Security number secret, can prevent some of the abuse. For instance, you can check your children's credit reports at credit bureaus to nip identity theft in the bud.
The Federal Trade Commission estimates that 5% of identity-theft cases involve minors. Other groups believe the number is closer to 10%, but no one knows for sure because the crime often goes unreported or takes decades to discover.
That is because most people don't realize that someone has been illegally using their identity or Social Security number until they apply for their first job, a driver's license, a student loan or a mortgage. They can also be denied phone service or federally provided services. Sometimes victims find out at a younger age if a bill collector tracks them down for an account that the child never opened. Some are even blamed for an act they never committed.
"Parents don't often check their children's credit history because they don't think they have one," says Rachel Kim, an associate analyst at Javelin Strategy & Research, a financial-services and payments research firm in Pleasanton, Calif.
Linda Foley, founder of the Identity Theft Resource Center, says there are two types of child identity theft: one when the child is younger than 18 years of age, and the other when they are older than 18.
"It's easy," she says, "to prove that a 5-year-old didn't sign anything in crayon." It is a little harder to rectify when the person already is an adult.
The Identity Theft Resource Center report found that more than half the child identity-theft victims surveyed first became victims between birth and age five. Most of the cases occurred when a person, often a family member, used the child's Social Security number for work and credit.
The research also found that 69% of the victims said the thief was one or both of their parents or a step-parent. Ms. Foley says that in some cases, immigrants who don't have a Social Security number use their children's identity.
Some people, she says, also use the number to create a new identity, especially if they have ruined their credit or owe money. They get away with it because credit issuers typically don't need to verify the applicant's age. Additionally, the credit-reporting agencies don't necessary know the age of the applicant.
"In some cases, the parents don't understand that they're causing any harm," says Ms. Foley. "They say: 'We'll pay off the bills before they reach 18.' "
She adds: "But we've seen fathers and mothers use a child's Social Security number when applying for a job to avoid paying child support."
Pam Dixon, executive director of the World Privacy Forum, a San Diego research group that focuses on privacy issues, says thieves also use children's birth certificates and Social Security numbers to purchase prescriptions.
The victims must eventually contact the three credit-reporting agencies, law enforcement and credit issuers to clear their records.
Unfortunately, because the perpetrator is often a family member, law enforcement frequently doesn't want to get involved, and children often don't want to prosecute their relatives.
November 21, 2007; WSJ
NEW YORK -- While only a small percentage of identity-theft victims are children, the number is growing, and the impact on the victim's credit, confidence and relationships could be devastating.
The crime can go undetected for years and is most commonly committed by a family member, according to a report released this week by the Identity Theft Resource Center, a San Diego nonprofit organization.
Fortunately, simple precautions, such as keeping your child's Social Security number secret, can prevent some of the abuse. For instance, you can check your children's credit reports at credit bureaus to nip identity theft in the bud.
The Federal Trade Commission estimates that 5% of identity-theft cases involve minors. Other groups believe the number is closer to 10%, but no one knows for sure because the crime often goes unreported or takes decades to discover.
That is because most people don't realize that someone has been illegally using their identity or Social Security number until they apply for their first job, a driver's license, a student loan or a mortgage. They can also be denied phone service or federally provided services. Sometimes victims find out at a younger age if a bill collector tracks them down for an account that the child never opened. Some are even blamed for an act they never committed.
"Parents don't often check their children's credit history because they don't think they have one," says Rachel Kim, an associate analyst at Javelin Strategy & Research, a financial-services and payments research firm in Pleasanton, Calif.
Linda Foley, founder of the Identity Theft Resource Center, says there are two types of child identity theft: one when the child is younger than 18 years of age, and the other when they are older than 18.
"It's easy," she says, "to prove that a 5-year-old didn't sign anything in crayon." It is a little harder to rectify when the person already is an adult.
The Identity Theft Resource Center report found that more than half the child identity-theft victims surveyed first became victims between birth and age five. Most of the cases occurred when a person, often a family member, used the child's Social Security number for work and credit.
The research also found that 69% of the victims said the thief was one or both of their parents or a step-parent. Ms. Foley says that in some cases, immigrants who don't have a Social Security number use their children's identity.
Some people, she says, also use the number to create a new identity, especially if they have ruined their credit or owe money. They get away with it because credit issuers typically don't need to verify the applicant's age. Additionally, the credit-reporting agencies don't necessary know the age of the applicant.
"In some cases, the parents don't understand that they're causing any harm," says Ms. Foley. "They say: 'We'll pay off the bills before they reach 18.' "
She adds: "But we've seen fathers and mothers use a child's Social Security number when applying for a job to avoid paying child support."
Pam Dixon, executive director of the World Privacy Forum, a San Diego research group that focuses on privacy issues, says thieves also use children's birth certificates and Social Security numbers to purchase prescriptions.
The victims must eventually contact the three credit-reporting agencies, law enforcement and credit issuers to clear their records.
Unfortunately, because the perpetrator is often a family member, law enforcement frequently doesn't want to get involved, and children often don't want to prosecute their relatives.
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