Child Identity Theft: How It Happens and Ways to Protect Your Kids

In today‘s world, identity theft looms as a constant concern. And our children face risks too. As an expert in cloud data security, I‘ve seen child identity theft become more prevalent, causing significant financial and legal headaches for families down the road. In this comprehensive guide, I‘ll shed light on what exactly child ID theft looks like, how it occurs, and most importantly—how you can safeguard your kids.

Over the past 5 years, child identity theft has rapidly increased, with 2022 seeing the highest rate on record. According to research from Javelin Strategy & Research, approximately 1.25 million minors were affected by identity theft last year—nearly doubling from the prior year. On average, resolving each case of child ID theft takes 120 hours longer than adult cases and has led to over $900 million in losses for families.

What is Child Identity Theft?

Child identity theft occurs when someone unlawfully acquires and uses a minor‘s sensitive personal data—including their full legal name, date of birth, Social Security number, or other information—to commit fraud.

Criminals typically use the child‘s information to open illicit credit cards, drain bank accounts, file false tax returns, or obtain medical services and government benefits. It often goes undetected for years, allowing significant damage to accrue over time.

Once the child turns 18 and applies for student loans, a first credit card, or government assistance, they may find their credit already ruined or benefits denied due to activity they never knew about.

How Does Child Identity Theft Occur?

From my experience in cybersecurity, child identity theft can stem from several common sources.

Data Breaches

Data breaches have become increasingly prevalent, with hackers illegally accessing company servers that house consumers‘ personal data. According to the Identity Theft Resource Center, breaches exposing children‘s information escalated 61% from 2020 to 2021.

Some of the most damaging recent breaches include:

  • The roblox gaming platform breach in 2020 exposing over 100 million users‘ data, many of them minors.

  • A 2021 breach of 110,000 student records at Alabama‘s Athens City Schools with names, addresses, and social security numbers compromised.

  • The massive 2017 Equifax breach impacting 145 million Americans, including an estimated 15 million minors.

Hackers use techniques like phishing, malware, and credential stuffing attacks to infiltrate company networks and exfiltrate data. They then sell the information on the dark web or use it themselves for identity theft. Lax cybersecurity and lack of data encryption at many organizations enable these breaches.

Family Members

Shockingly, according to 2021 research from Javelin Strategy, a full 73% of child identity theft stems from someone the family knows. This may include relatives, friends, neighbors, babysitters, or other acquaintances.

These individuals gain access to documents such as the child‘s Social Security card or birth certificate and misuse it without the parents‘ knowledge. Motives range from opening illicit credit cards to gain funds to using the child‘s identity when interacting with police or government benefit programs.

Psychological factors like financial desperation, addiction issues, or a sense of entitlement over family resources can compel relatives to commit this fraud against kids. Parents often struggle to accept or report such betrayals of trust.

Widely Shared SSN

A child‘s Social Security number falling into the wrong hands can have disastrous effects. Criminals pair the SSN with other fake details to create a synthetic identity used to open fraudulent accounts and make purchases.

Children in foster care systems are among the most susceptible to this occurring. Their personal data passes through numerous case workers, agencies, foster parents, and other parties during the placement process. Paperwork containing their full names, birth dates, and SSN often sits in files accessible to many individuals.

Approximately 60,000 children are adopted from foster care each year in the United States. But weak security practices continue to plague many agencies, needlessly exposing the youths‘ information.

Protecting Your Kids from Identity Theft

Despite growing threats, parents can take proactive precautions to help safeguard their children from identity theft.

Curb Unnecessary SSN Sharing

Limiting who has access to your child‘s Social Security number is a crucial first step. Only share this with trusted entities like your bank, your accountant, healthcare providers, or government services that absolutely require it.

If a new party such as a school requests your child‘s SSN, ask detailed questions first. Inquire why they need this specific information, how they will protect it once provided, what alternative identifiers they could use instead, and what measures they take to encrypt sensitive data. You have a right to understand their reasons and cybersecurity practices.

Often a student ID number, partial SSN, or other token can suffice for verification purposes. Disclosing the full 9-digit SSN should be a last resort.

Secure Documents at Home

Keep any documents containing your child‘s personal information, such as social security cards, passports, or birth certificates, in a safe, locked location at home. Never leave these sitting out accessible to others.

If you do discard documents with sensitive data, thoroughly shred them first using a cross-cut shredder. Avoid just throwing papers with full names, addresses, or other details in the garbage where criminals could retrieve them.

Also, limit how much personal information you share about your kids on social media or school/club forums. Posting their full legal names, birthdates, interests, or school names widely online creates an easy trail for thieves to access and potentially exploit.

Educate Your Kids

Have open conversations with your children about online safety and the importance of protecting their personal details. Explain that they should never share information like their full name, date of birth, address, phone number, or Social Security number with strangers online or in real life.

Set up parental controls and privacy restrictions on their devices and accounts to limit access to their data. Go over safe social media and gaming habits, encouraging them to use nicknames and avatars where possible. Monitoring software can also alert you to risky posts.

Building these smart online habits early on helps prevent their data from inadvertently ending up in the wrong hands.

Monitor Credit Reports

Checking if your child already has a credit report and monitoring it helps detect any early fraudulent activity. Consider signing up for a credit monitoring service that provides alerts for any credit inquiries, new accounts opened, or unusual activity associated with your child’s Social Security number.

Many identity protection services like Norton LifeLock, IdentityForce, and Aura allow you to add children to your account for continuous monitoring to safeguard their information. While most kids under 18 don’t have an established credit history, it’s still possible for thieves to open illicit lines of credit that you’ll want to be notified of.

Warning Signs of Child Identity Theft

Watch for any of these common red flags that could indicate your child’s identity was compromised:

  • You receive calls or bills addressed to your child from collection agencies or credit card companies regarding accounts opened fraudulently in their name.

  • Pre-approved credit card offers arrive in the mail for your minor child who does not have an established credit history.

  • Your child is denied government benefits they would normally qualify for, such as healthcare coverage or nutrition assistance, because their SSN has income or resources already associated with it.

  • Your child is rejected for student loans or other legitimate credit products due to a damaged credit file containing illicit activity.

  • Strange messages, posts, or searches you didn’t authorize start appearing on your child’s social media or online gaming accounts, indicating a hacker gained access.

  • You receive notice from the IRS stating your child did not pay taxes on unreported income, when in reality someone else filed a false return using their SSN.

If anything seems amiss, take action quickly to investigate and halt further misuse of your child’s details. The longer identity theft persists, the harder it becomes to undo the harm.

Responding to Identity Theft

If you uncover signs your child’s identity was misused, prompt action is key:

First, contact any companies where you uncovered fraudulent accounts opened in your child’s name. Speak to their fraud department about closing the account and reversing any charges made without authorization. Request written documentation that your child is not liable for charges to protect them in the future.

Change online account passwords immediately if those were compromised. Make the new passwords strong and unique for each account. Enable two-factor authentication wherever possible for an added layer of security.

File an identity theft report with the Federal Trade Commission at IdentityTheft.gov outlining all the details. This generates a recovery plan to help restore your child’s identity. Also reach out to the Identity Theft Resource Center for guidance navigating each necessary step.

You can place a credit freeze on your child’s credit file to prevent anyone from accessing it or opening new fraudulent accounts. Contact each of the three major credit bureaus to monitor your child’s credit reports routinely for unusual activity and quickly dispute any errors.

Submit a formal police report about the identity theft to create a paper trail of evidence. Provide as many details as possible about where and how it occurred.

Remain vigilant in checking credit reports and account statements for any follow-on misuse. With dedication and organization, you can successfully contain the damage and prevent further identity theft against your child.

In Summary

Child identity theft is a rapidly growing menace as data breaches proliferate, relatives succumb to temptation, and criminals seek clean credit files to exploit. But parents have power to limit risks through these key steps:

  • Curb unnecessary sharing of your child‘s sensitive data like their SSN.

  • Lock down physical documents and educate kids on safe online habits.

  • Monitor your child‘s credit report for early signs of misuse.

  • If fraud occurs, act decisively to freeze credit, dispute charges, and file police reports.

With vigilance and safeguards, you can drastically reduce dangers and help set your child up for a bright, theft-free future. If you have any lingering concerns, I‘m always available to help families implement an air-tight identity protection strategy. We‘ll get through this together.

Luis Masters

Written by Luis Masters

Luis Masters is a highly skilled expert in cybersecurity and data security. He possesses extensive experience and profound knowledge of the latest trends and technologies in these rapidly evolving fields. Masters is particularly renowned for his ability to develop robust security strategies and innovative solutions to protect against sophisticated cyber threats.

His expertise extends to areas such as risk management, network security, and the implementation of effective data protection measures. As a sought-after speaker and author, Masters regularly contributes valuable insights into the evolving landscape of digital security. His work plays a crucial role in helping organizations navigate the complex world of online threats and data privacy.