By Elaine Walker, Certified Fraud Examiner
We’re constantly bombarded with advertisements for products to keep us safe from identity theft. Let’s separate the facts from scare tactics.
According to the Institute for Fraud Prevention, 60% of identity theft is perpetrated by someone the victim knows: a family member, friend, or someone who has access to the victim’s home. LoveFraud readers know that the sociopath in their lives would have no problem starting a new financial life using a child’s identity.
But just how much should you pay for protecting your child’s identity (and your own)? According to a Consumer Reports article published in February, 2012 (and revisited in January, 2013), free and low-cost do-it-yourself protections are just as effective as the services that charge hefty fees. Even the Federal Trade Commission says, “The bottom line: there’s little or nothing a commercial company can do for you for a fee that you can’t do yourself for free.”
The first thing to do when thinking about protecting your child’s identity is to go to the Federal Trade Commission’s website, www.ftc.gov/idtheft. This web page has just about everything you’ll need to know about protecting your own identity as well as your child’s. For child specific information, scroll down and click on “Child Identity Theft.”
Another helpful website is www.IdentityTheftNetwork.org. Click on Get Help and choose from the drop down menu. This site has information for specific situations such as child ID theft, theft due to domestic violence, senior ID theft, and theft by a family member. There are links to sample letters to creditors and reporting agencies and links to other helpful information.
On these sites, you’ll find a list of warning signs that your child’s identity may have been stolen. Among those warning signs are credit card offers addressed to your child, credit card bills in your child’s name, calls to your child from collection agencies, or even a warning about unfiled tax returns when your child hasn’t worked. You could be denied your child’s deduction on your tax return or denied government benefits because they’re already being claimed by someone else.
How to do a credit check
Whether you’ve seen any of the warning signs or not, you can check for a credit report in your child’s name. To do this, contact the three credit reporting agencies (Equifax, Experian and TransUnion) and give each agency a copy of your child’s birth certificate, social security card, your identification (driver’s license or passport) and possibly other identifying information will be needed. Ask that the child’s social security number be run through their system without the child’s name. By running the name with the SSN, their system may not show anything out of place if the SSN is being used under a different name. Running the SSN only through the system will show if anyone is using or has used the child’s SSN. It’s possible that the SSN was used even before it was issued to your child.
If the reporting agencies tell you that your child doesn’t have a credit report, that’s a good thing because:
YOUR CHILD SHOULD NOT HAVE A CREDIT REPORT!
However, if your child does have a credit report, you’ll need to repair the damage. Both of the above websites have information and links to everything you’ll need for doing this. You’ll have to notify the three credit reporting agencies to place a fraud alert and/or credit freeze on their accounts, report the theft to the Federal Trade Commission and to your local police department. You’ll also need to contact businesses where your child’s information was used.
If your child is in the clear, you can make sure his/her identity stays that way by placing a credit freeze on his/her account. Consumers Union has a good explanation of what a credit freeze is and how to freeze an account. Since November 1, 2007 anyone can place a freeze on their own or their child’s credit file even if they haven’t been a victim of identity theft. Each state has different rules and fees for doing so.
When you place a freeze on a credit file, you have to create a PIN or password that will be used to thaw (or unfreeze) the account. While the account is frozen, only companies you already have credit with can view your credit file. No new accounts can be opened by existing creditors. New creditors can’t even look at the account until it is “thawed” by you.
While the freeze is in effect, an ID thief would have a hard time opening credit in your child’s name. However, if a company does not do credit checks before extending credit, you could end up with accounts you didn’t authorize. This scenario is rare, but does happen occasionally. If the thief is a family member who has access to PINs and other personal information, they may be able to bypass the freeze.
If a thief has already opened accounts using your child’s identity, placing a credit freeze on the account won’t stop the thief from tampering with existing credit/debit cards, bank accounts, etc. You’ll have to go through the steps outlined on the FTC’s website to close those accounts.
If you choose to place a freeze on your own credit, you’ll still have to monitor your credit cards and bank accounts closely. The freeze only stops new accounts from being opened. It doesn’t stop a thief from tampering with already existing credit cards or bank accounts. If you haven’t signed up with your bank to do online banking, doing so is the easiest way to monitor your finances often.
You can also monitor your credit by getting a free copy of your credit report once per year from each of the three credit reporting agencies: Experian, Equifax and TransUnion. In other words, you can get your credit report three times per year. To get your reports, go to www.AnnualCreditReport.com. Beware: The heavily advertised website FreeCreditReport is NOT free! There are other pay sites as well, so be sure you’re at the correct website.
Social Security Numbers
You’re not out of the woods yet! Some ID theft doesn’t concern credit. ID thieves steal SSN’s to get medical care or get a job. If your too-young-to-work child gets a notice from the IRS that they haven’t filed their tax return, their SSN is being used by someone else. Check medical insurance reports to make sure they’re accurate and that someone else didn’t use your insurance benefits.
For more detailed information about securing and protecting your child’s credit (and your own), see these articles at the Identity Theft Resource Center website:
Another thing you can do to protect the identity of your child and yourself is to password protect all electronic devices. There was a recent case where a woman’s Kindle was stolen on an airplane and the thief was able to get identifying information from the Kindle. Who would have thought?