If the words identity theft make you feel more than a little nervous, you're not alone. Many parents are surprised when they first hear about how easy it is for their child's identity to be stolen, and how long it can take before the crime is discovered. Ultimately, you are your child's best protection against identity thieves, but lawmakers are aware of the problem, and there has been some movement to protect children. In 2011, President Obama signed the Foster Youth Financial Security Act, allowing foster kids (16 and older) to receive free credit checks and get help correcting inaccuracies before leaving the foster care system. More recently, on January 1, 2013, a new law took effect in Maryland that allows a parent to take control of their child's credit until she turns 18. Maryland State Delegate Craig Zucker says the law was "...the first time parents or guardians can proactively contact any of the three credit agencies [Equifax, Experian, or TransUnion] and freeze their child's or dependent's information to protect against identity theft."
Robert Siciliano, a personal security and identity theft expert believes that children need a national law to protect them. In The Huffington Post, he wrote that "credit bureaus are in the best position to prevent child identity theft by simply tweaking their systems to allow a credit freeze before" any fraud occurs. Robert P. Chappell Jr., a law enforcement professional and author of Child Identity Theft: What Every Parent Needs to Know, strongly feels that parents, government, and law enforcement agencies all need to work together.
While you may hope that your child's identity will never be stolen, a bit of preparation could help prevent it from happening. Here are some surprisingly common ways your child could get stuck with identity theft problems, along with tips for keeping your precious bundle from becoming a victim of this increasingly common crime.
Applying for a Social Security Card
One of the first things you do as a parent is to obtain a Social Security number (SSN) for your child. This is the key to his identity -- and thieves can use it to unlock many financial doors. Jamie May, vice president of Customer Service & Chief Investigator at AllClear ID (allclearid.com), a credit monitoring service, says that a stolen SSN can be used "for a variety of purposes," adding that the main goal of identity crooks is to create a clean credit history. Once data has been stolen, a fraudster can use it to get a cell phone, a credit card, a bank loan, and even health insurance.
Prevention Tip: Parents need to be very careful about who they share their child's SSN with; the fewer people, the better. Unfortunately, there are a lot of organizations that ask for this number even though they don't need it. "It's really alarming when we talk to some parents; the SSN is on [so many] forms," May says. "Sometimes it is a requirement...but most times it's really not. Parents [should] ask if they really need the SSN or what it's going to be used for. We've heard cases of parents running the soccer team [and leaving personal] forms in the trunk of a car [that was] then stolen." Chappell recommends that families bring letters with personal information to the post office rather than leaving them in a mailbox to be picked up. He calls it "one of the red flags of identity theft," referring to the red flag that lets the mail carrier know when to stop and pick up any outgoing missives. A criminal can drive around a suburban neighborhood late at night looking for those red flags and possibly get his hands on a variety of forms featuring these valuable identity digits. To be extra careful, send any forms with SSNs via registered or certified mail, which requires the recipient's confirmation signature.
Opening the First Bank Account
Your child's first bank account is a smart place to deposit savings bonds or checks from generous grandparents, but opening a savings account can also open the door to identity theft. Once your child has an account in her own name, there will be bank statements. Whether you receive them via snail mail or e-mail, it is possible for someone else to get his hands on the account number and your child's cash. A clever crook might also use your child's account to do other business with the bank, perhaps by getting a loan that he has no intention of paying off. Any nefarious financial activity taking place in your child's name will be reported to credit agencies, leading to a poor credit score, something that is extremely difficult to clean up even under the best of circumstances.
Prevention Tip: Make sure you set up a joint account so that no one can access it without your approval. (Your bank probably does this by default, but always double-check.) Chappell points out that parents must take the time to opt out of receiving any marketing materials to avoid having a child receive credit offers in the mail. Imagine if an identity thief sees a pre-approved credit card addressed to your toddler in your mailbox: All she has to do is fill out the form and she's got a brand-new line of credit to use to buy a brand-new computer and a new wardrobe. Experts strongly suggest that you monitor your mail carefully for any credit offers sent directly to your child. If any credit offers are sent to your child, "it's definitely a sign of child identity theft," Chappell says, "unless you have been to a bank and opened an account in your child's name and failed to opt out of marketing." If you do get one or more of these offers, make sure to shred them immediately. If possible, trace the offer back to the source and demand that your child's name be removed from the mailing lists. Also -- and this is the most important piece of advice every expert gave us -- check your child's credit report immediately.
Creating an E-mail Account.
It's not uncommon for young children to have e-mail accounts of their own. It's cute, grandparents love it, and it makes a kid feel grown-up. But how can you ensure that an account won't be abused? Children can be trusting, especially if they think they are e-mailing with someone they know. A criminal could ask for phone numbers, addresses, and even credit card numbers, and a little one might not realize how dangerous it is for information to fall into the wrong hands.
Prevention Tip: If your child is young, keep the password to yourself and your partner so your child can't log in when you aren't around to supervise. Consider creating accounts on kid-safe e-mail services (such as Kidsemail.org or Zoobuh.com) that can help protect your child's info and allow you to monitor accounts. You may decide to allow your child more leeway online when you feel confident that she understands the potential pitfalls of electronic communications, but we recommend not allowing children younger than 10 to have a private password. If you have a particularly tech-savvy youngster who may violate your password policy, consider using a service like Gmail that offers password recovery to be texted or sent to a different e-mail address. For extra security, create a whitelist, a list of approved e-mail addresses from trusted family and friends, that your child can receive messages from; procedures for doing this vary with each e-mail provider.
Children should always practice basic computer security. Viruses and other malware can masquerade as movie files, photos, and other seemingly harmless data, so parents should teach kids not to click on unfamiliar links in an e-mail. Alos, they should never "download [any] content from unknown or distrustful sources," especially from file sharing sites, May says. Avoid logging in to your accounts on public computers, as this is a common way for passwords to get stolen. Unsecured public Wi-Fi hotspots are a potential problem, but your kids probably aren't spending that much time surfing the Web and sipping coffee at cafes?... at least not yet.
Setting Up Social Media Accounts
As kids grow up and start wanting more social independence, they will request their own smartphones and social media accounts (Facebook, Twitter, perhaps even Pinterest). Fortunately, all sites with members under the age of 13 must be compliant with the Children's Online Privacy Protection Act (COPPA), which means that the site in question cannot ask anyone under 13 for any personally identifiable information, such as names and e-mail addresses. There are, however, a number of Web services created especially for the single-digit set, such as Virtual Piggy (virtualpiggy.com), which lets parents set up a controlled shopping and savings account for their children.
Once your children become teenagers, they will legally be allowed to access every social network, though some (like Twitter) don't actually have specific age restrictions. But this doesn't mean kids shouldn't protect their personal information by adjusting privacy settings and being careful about what they reveal, even to friends. Jo Webber, Ph.D., Virtual Piggy's CEO and founder, says that parents have to make their children aware that whatever information is published online could be viewed by anyone. There are dozens, if not hundreds, of sites devoted to photos, tweets, and Facebook posts that users wish they could take back. Even if you delete an embarrassing snapshot, someone could potentially download and repost the image elsewhere. "Parents should talk to their kids and get them to understand that once [privacy is] gone, it's gone. You don't know who's getting that information on the other end," Dr. Webber says. This is equally true for parents. "Whatever you put out there on social media about your kids, think about whether you'd be happy if everybody had that information."
Prevention Tip: Once again, keep the passwords and do not share them. Tell your children that the price of having their own social media profiles is that you can access their accounts whenever you choose. When creating user names, Dr. Webber advises that they "should not identify the child" in any way. Passwords should also not contain any personally identifying information (SSNs, birthdays, phone numbers, house addresses, or legal names). Instead, a strong password should include a combination of letters, special characters, and numbers; some sites have listed requirements and automatic indicators to prompt parents to create ones with all these elements. Dr. Webber recommends periodically changing passwords on all of the sites you frequent, even every month if you want to play it safe. Finally, never use the same password twice. This way, if one is stolen, your other accounts will remain protected.