Identity theft affects children, too – and it can cause financial problems for them in adulthood

You might think that your children’s data wouldn’t be of much use. But they will have a clean credit score and a clean criminal record—something that fraudsters can exploit for their own benefit. Even if it is legally proven that someone else has obtained a loan or incurred a legal fine by using the name of a child, this can still present endless problems and paperwork for that child in the future. 

In addition, in most countries identity theft is considered a crime, and the parents or legal guardians of young identity theft victims should contact the local police or seek legal advice. If you don’t act to protect the personal data of your children, it can have a serious impact on their financial futures.

Recent statistics are difficult to find. But according to a 2018 study released by research firm Javelin Strategy & Research, more than one million children in the U.S. were victims of identity fraud in 2017. More concerning is the fact that two-thirds of those affected were under the age of 8. “The limited financial histories of minors give fraudsters a long-term opportunity to slowly develop networks of accounts, mimicking legitimate holdings,” the study notes. 

Beware of social engineering

Identity thieves usually try to steal the name, address, passport or ID number, and, in some cases, the financial data of victims. They either buy such data in bulk on darknet websites or use malware or social engineering to obtain it themselves. 

By infecting victims’ devices with malware, cybercrooks can exfiltrate personal data stored on the devices or obtain it from internet browsers. If they use a keylogger, everything that a victim writes on their infected device is sent directly to the attacker. And that includes credit card numbers and passwords. However, the most cost-effective solution for online fraudsters is social engineering: they simply trick their victims into providing personal details themselves, either by impersonating somebody else or by manufacturing a fake website.

At ESET, we see cases like this so often that you might think it’s impossible to protect your child or your family from online fraudsters. But that’s not the case. By following these simple steps, you will strengthen the protection of your children’s personal data.

How to protect your family from identity theft

Teach your children not to overshare.  Talk to them about their use of social media and what they usually enjoy posting there. Explain to them why it’s not wise to fill in their home address or provide other personal information when accepting friend requests from people that they don’t know. In fact, they should reconsider any such requests from those they don’t know personally.

Good password hygiene is a must. Teach your family how to come up with long, hard-to-guess and unique passwords, or how to use a password manager. Remember to not reuse passwords for different services or websites.

Keep all your family devices secure and submit your personal data online only when your internet connection is secure. This means that you should avoid public Wi-Fi or any untrusted sources of internet connection. On an unsecured connection, fraudsters can easily eavesdrop on all your submitted forms. 

Discard sensitive documents in a safe manner. If you want to throw away old physical documents that contain personal data, shred them. Don’t forget that your older electronic and data storage devices contain a lot of personal information. Some of them offer a wipe function to safely discard all saved data. There are some free and premium online tools to help you with the rest of them.

Teach your children to identify suspicious messages or websites that might try to trick them into submitting their personal data. Or use anti-phishing, which can be part of a cybersecurity solution. If you or your family tries to open a phishing website, your antimalware solution will warn you.

Next: Call the police and contact national credit reporting agencies

But what should you, as a concerned parent or legal guardian, do if you find out that the personal data of your child has already been stolen and used for something illicit? Do not hesitate: contact your local police. In one way or another, in most countries and regions, identity theft is a criminal act. 

In addition, the Family Online Safety Institute, an international non-profit group which works to make the online world safer for children and their families, recommends that you take these steps:

1. Request credit reports

Contact all three national agencies to request a credit report in your child's name. These agencies include TransUnion, Experian, and Equifax. Keep clear records of your correspondence with each agency. If your child has a low credit score or records show recent credit activity, then they have probably fallen victim to fraud.

2. Close fraudulent accounts

Contact any company where you've found fraudulent activity and explain that your child's identity has been stolen. Request that they remove any accounts or account activity linked to your child's name or social security number, and offer proof that your child is a minor.

3. Place a fraud alert

You only have to contact one credit reporting agency to place a fraud alert, as each company is required to notify the others. A fraud alert lasts 90 days and will prevent anyone from opening new credit in your child's name without first verifying identity.

4. Request a credit freeze

A credit freeze restricts access to your child's credit reports and other personal information without impacting existing lines of credit. You'll have to contact each reporting agency and you may have to pay up to $30 to place the freeze, but this step provides a valuable layer of protection on top of a fraud alert.

5. File a report with the Federal Trade Commission (FTC)

You can file your report online and receive personalized recommendations for how to proceed in recovering your child's credit.

6. Contact any business where your child's identity was used.

The FTC offers a number of sample letters for your reference as you deal with the fallout from this identity theft.

Then, you may want to prepare for a surprise. As the Javelin study showed, more than half of child identity fraud victims personally know the perpetrator and there is a strong connection between fraud and bullying. This means that in some cases you will need to contact your child’s school representatives and discuss this topic with them – or you may need to convene a family council to talk about the behavior of a certain family member.