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Identity theft can hit children too

by Larry Magid

Identify theft can be a serious problem for victims. It can destroy your credit, get you in trouble with the IRS and sometimes even result in your arrest if someone commits a crime in your name. Other consequences, wrote Katie Morell in the book, “Stolen Identity,” include counterfeiting and forgery of documents, stealing medical services in your name and filing tax returns as you so that they can get your refund.

A 2008 study conducted by the Bureau of Justice Statistics found that 11.7 million people, five percent of all persons age 16 or older in the United States, were victims of identity theft during the two years prior to the survey. That represented a financial loss of more than $17 billion.

As Morell points out in her book, identity theft is nothing new. It’s actually referenced in the book of Genesis in the Bible with the story of Jacob who posed as his brother Esau. Jacob and Esau didn’t have Internet access (the only tablets around at the time were made of stone), which means Esau didn’t have to worry about Jacob using his identity to apply for credit online as has happened to millions of Americans.

One thing that may not be obvious is that children are at risk. Even very young children can be victims of identify theft.

One reason is because most kids have squeaky clean credit ratings. They have probably never taken out credit, which means they have never been late with a payment. Another is that the identify thieves know that the crime can go undetected for many years. Most people periodically check their credit report or take out loans or credit cards or rental applications and if their ID has been stolen, they will probably find out. A child may not find out until he or she applies for a student loan or a credit card, which usually doesn’t happen till they’re nearly 18.

According to the Federal Trade Commission, a child’s social security number can be used to apply for government benefits as well as to open bank and credit card accounts. Identity thieves can also use it to rent a place to live, apply for a loan or set up utility service. The person’s age and description doesn’t travel with the social security number so it’s possible for an adult to get by with a child’s number.

Occasionally, victims get warning signs, such as being turned down for government benefits because they are being paid to another person using the child’s social security number, says the FTC. You may also get a notice from the IRS saying the child didn’t pay income taxes, or that the child’s social security number was used on someone else’s tax return or may hear from a collection agency about bills for products or services your child didn’t order.

The FTC warns parents not to share their child’s social security number “unless you know and trust the other party,” but experts I’ve spoken to from the Identity Theft Resource Center suggest that you can go even further. It’s common for companies and service providers to ask for social security numbers but, in most cases, they don’t really need them. Doctor’s offices, for example, often ask for that information but they don’t need a child’s social security number — not even for credit information — since the child isn’t the one paying the bill. Landlords might ask for social security numbers for everyone living in the unit, but they only need them from the person responsible for paying the rent so they can do a credit check.

And, if you or your child must disclose a social security number, drivers license number or other confidential data, ask how it will be protected. Several years ago, while she was still in her teens, my daughter applied for a job at a coffee shop and was asked to write down her social security number. I was with her when the clerk left her application on the counter for anyone to glance at. I insisted he at least put in the backroom. Ideally it should have been kept in a safe but they really didn’t even need that number until they were ready to hire her or at a point where they needed to do a background check.

There are times when you are asked to type in social security numbers or other identification online but there are very few situations where it’s actually necessary, such as when you’re applying for credit or accessing your credit report.

If you provide it, be sure you’re using a secure connection and avoid doing so from a public WiFi hotspot. Always be sure your operating system and any browser or other software or apps you are using are up-to-date to reduce the chance of a security hole.

Schools typically have a great deal of information about students, so check with school authorities on how they are protecting your child’s data. There are strict federal guidelines outlined in the Family Educational Rights and Privacy Act (FERPA). You’ll find lots more about this in a free booklet I helped write called A Parents Guide to Student Data Privacy

Kids also need to be careful about what they post in social media. I’m not suggesting they remain mum. Millions of kids post their picture and what school they go to without experiencing harm. But kids should be aware that pictures of their drivers’ license (as proud as they may be) or any social security or financial data does not belong on social media.