2 Years Old & Bankrupt: Report Shows Unbelievable Child ID Thefts


NEW YORK (MainStreet) — You may have taken adequate steps to ensure your identity doesn’t get stolen, but a report indicates it’s really your child’s identity you should worry about.

According to research conducted by identity theft protection service AllClear ID and consulting group Carnegie Mellon Cylab, children’s Social Security numbers are 51 times more likely to be stolen than an adult’s.

The report is based on identity protection scans of 42,232 children (18 and under) in the U.S. during 2009-10. The pool includes everyone under 18 in a database of more than 800,000 identity records.

Researchers found that 4,311 (10.2%) of these minors’ Social Security numbers had loan, property, utility and other accounts associated with them. Comparatively, only 633 of the 347,362 adults had fraud associated with their Social Security numbers.

Fifty-four percent of victims were under 12, with the youngest being a mere 5 months old. The largest instance of fraud involved $725,000 worth of debt racked up by scammers using the identity of a 16-year-old girl.

Other egregious discoveries of fraud involve a 2-year-old in bankruptcy, a 9-year-old in debt collections and a 14-year-old with a foreclosure on the books.

Researchers say the primary drivers for such attacks are illegal immigration (to get false IDs for employment), organized crime (to engage in financial fraud) and to circumvent bad credit ratings. 

The report says kids are increasingly becoming the target of fraudsters because those crimes go unnoticed for many years and are usually not detected until the child tries to get credit for something.

Child identity theft has, indeed, been growing for some years.

In August 2010, the FBI discovered that hundreds of online businesses were using computers to find dormant Social Security numbers, usually those assigned to children who don't use them, so they could sell them under another name to help people establish phony credit and run up huge debts they will never pay off.

To protect your child’s identity, AllClear ID and Carnegie Mellon Cylab suggest talking to children about the dangers of sharing personal information online, to refrain from using your child’s name to open utility or other credit accounts and keeping their sensitive documentation in a safe place.

They also advise parents to be on the lookout for junk mail bearing their child’s name.

“If you begin receiving pre-approved credit cards or other unsolicited financial offers in your child’s name, it is an indicator that your child may have an open credit file,” the report states.

For more ways to combat fraud in general, check out MainStreet’s roundup of the best identity theft protection services.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

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