In Kindergarten and in Debt: The Problem of Child Identity Theft
When we think of a child’s safety we think of physical and emotional well-being, but what about their financial safety? According to the Carnegie Mellon Cylab’s report Child Identity Theft, published in April 2011, children’s identities are increasingly used to commit fraud.
Just like a criminal can use personal information of an adult to commit fraud, they can use a child’s identity to:
- Open credit accounts
- Take out student loans, home, boat, and car loans
- Receive government benefits and unemployment compensation
- Receive tax refunds
- Access medical care
- Secure employment
Many criminals turn to stealing children’s identities because it can go unnoticed for many years and this crime offers virtually no consequences. The child victims, on the other hand, inherit significant debt, carry a tarnished credit history, and suffer emotional impacts—particularly if the offender is a parent or family member—all before they even reach legal age.
How is child identity theft even possible? Unfortunately, the biggest loophole is the credit granting system itself. The system isn’t set up to verify if the information provided in a credit application is accurate (i.e., that the Social Security number presented corresponds with the age and particular person to whom it was issued by the Social Security Administration).
For now, the most important step we can take is to help build awareness of this issue, learn more, and talk to our friends and family about child identity theft.