You're probably weary of being reminded to take precautions against identity theft, but here's a wrinkle you may not have considered: in recent years, identity thieves have broadened their reach by harvesting children's dormant Social Security numbers (SSNs) and using them to illegally obtain jobs, open fraudulent bank and credit accounts, mortgages or car loans and much worse.
Many victims have no inkling anything is amiss until years later, when they apply for a student loan, bank account or apartment and are turned down because of the poor credit history someone else racked up. Some children and their parents have even been hounded by collection agencies or served with arrest warrants because the debts or criminal activities that thieves executed were so extreme.
So what's a parent to do? There are no completely foolproof methods to protect your child's identity, but here are some precautions you can take:
Social Security Numbers
You may be tempted to simply not register your kids for SSNs until they turn 18, but that's not practical in today's world. For one thing, children need one if you want to claim them as dependents on your taxes. They also may need an SSN if you want to obtain medical coverage or government services for them, or open bank accounts or savings bonds in their name.
The vast majority of parents now register their children for SSNs at the same time that they apply for birth certificates at the hospital, through Social Security's Enumeration at Birth program. If you wait until later to apply, you must provide proof of your child's U.S. citizenship, age and identity, as well as proof of your own identity. To learn more about the application process, click here.
Because each person's SSN is unique, it's not uncommon for schools, health care providers, insurance companies, banks and other institutions to require that parents provide one as an identification tool. However, don't be afraid to ask:
- Why do they need an SSN? Is there a legal requirement, and if so, what is it?
- Will they accept alternative identification?
- What will happen if you don't disclose it?
- What security precautions do they take with personal information?
- Will they agree not to use the SSN as your child's personal identification number on correspondence, account statements or ID cards?
There are several warning signs that your child's personal data may have been compromised:
- They receive preapproved credit account offers.
- They receive calls or billing statements from collection agencies, creditors or government agencies (including the IRS).
- You are unable to open a bank account in their name because one already exists with the same SSN.
- They are denied credit, employment, a driver's license or college enrollment for unknown or credit-related reasons.
Bear in mind that there may be legitimate reasons that your child is receiving credit offers. For example, it could be a marketing outreach from an affiliate of your bank because you opened a college fund, or even if they are enrolled in a frequent flyer program.
However, if you strongly suspect or have evidence that an identity theft has been committed, you can:
- File a police report and keep a copy as proof of the crime.
- Contact the fraud units at the three major credit bureaus for instructions: Equifax (800-525-6285), Experian (888-397-3742) and TransUnion (800-680-7289).
- Notify the Federal Trade Commission (877-438-4338), whose Identity Theft site contains information on fraud alerts, credit freezes, how to work with police and much more.
- File a complaint with the government-sponsored Internet Crime Complaint Center, which forwards cybercrime complaints to appropriate law-enforcement and regulatory agencies.
- Contact Social Security (800-772-1213) to inquire whether anyone has reported income using your child's SSN. In extreme cases, they may even issue a new SSN, but that alone is not guaranteed to solve the problem. See Identity Theft and Your Social Security Number for details.
- Contact the IRS' Identity Protection Unit (800-980-4490).
Follow the same precautions with your child's personal information as you do with your own:
- Shred documents containing personal information before discarding them.
- Don't give out personal information by phone, mail or email unless you initiated the contact and know with whom you're dealing.
- Never click on links in unsolicited emails, don't choose obvious passwords, and use up-to-date firewalls, anti-spyware and anti-virus software.
- Lock up personal information at home and work.
- Be aware when mail or bills don't arrive as expected. Thieves could fill out change-of-address cards to redirect your mail.
- Save and compare credit card receipts with charges on monthly statements. If you find an error, immediately contact the card issuer via phone and in writing.
- Guard against "shoulder surfers" at ATMs and retailers.
- Never conduct Internet transactions on unsecured websites (those with "https" in the address).
Also, if your kids are old enough to use the phone or computer, warn them about the dangers of revealing any personal information over the phone, in response to an email or text, or on social networking sites.
For more tips on protecting personal information online, see my previous blog, "Make Sure You Are Cyber Secure."
Bottom line: in today's world, we're all vulnerable to identity theft -- even our kids. Make sure you know the warning signs and what to do if your kid's personal information has been compromised.
This article is intended to provide general information and should not be considered legal, tax or financial advice. It's always a good idea to consult a legal, tax or financial advisor for specific information on how certain laws apply to you and about your individual financial situation.
Follow Jason Alderman on Twitter @PracticalMoney.