Safeguarding Your Kids From a World of Cybercrime & ID Theft

Safeguarding Your Kids From a World of Cybercrime & ID Theft

There were about 12 million identity thefts in the U.S. in 2012, according to a Javelin Strategy & Research report. Identity theft is a major concern, and it is becoming increasingly popular among children. Imagine getting pelted with collection calls stating that your twelve year old was behind on her car payment? Or finding out that your child is the owner of a house in another state that is currently in foreclosure? Believe it or not, these are not fictional stories; these children were the victims of identity theft.

Safeguarding Your Kids From a World of Cybercrime & ID Theft

Protect your children from identity thieves by following these tips.

It’s easy to see why thieves target kids. Children have perfect credit records, and parents generally don’t monitor the status of their children’s identities. A child’s Social Security number can be stolen and used just as adults’ are used — to open bank accounts, credit cards, apply for loans, government benefits or to secure a lease. A child’s identity can also be used for illegal immigration and to clean up a credit score. According to the Huffington Post, statistics have shown that the victim knows or is related to the perpetrator about 27 percent of the time, but a large number of cases involve a stranger.

Parents are also often alarmed to see that their children’s names somehow get onto those same lists that adults are on, approaching people by mail with credit card offers. Some companies have sent out actual credit cards that can be activated with one phone call. Although children are obviously not allowed to have credit cards, many of these offers fall into the wrong hands. The results can be disastrous to the child’s credit.

The Huffington Post reported that the government stepped in to create the 2009 Credit Card Accountability Responsibility & Disclosure Act. This bill made age 21 the minimum at which a child could have a credit card. (Students can get a card at 18 with a co-signer.) Credit card companies are also no longer allowed to recruit student clients on college campuses.

However, even these governmental measures are not a guarantee that your child won’t be a victim. What can you do as a concerned parent? Follow these guidelines to keep your child’s credit safe and pristine:

  1. Credit offers mailed in your child’s name are a red flag. Call and have them removed from that bank or company’s mailing list and find out how they got your child’s name.
  2. Check with the credit bureaus to see if your child has a credit report. According to CNN, if your child is a minor, they shouldn’t have one yet. If there is one, it’s a good indicator that your child’s identity has been stolen.
  3. If you receive a collection call, letter or a bill in your child’s name, contact the creditor immediately and investigate the matter.
  4. Forms for your child’s school often require personal information. Find out how this information will be used, stored, if it will be shared and how it will be disposed. Schools are required by law to protect sensitive information.
  5. Invest in an identity/credit monitoring service for your child, such as LifeLock identity theft alert.
  6. Teach your teens to check their credit report once a year on their own — it is free to do so once annually. Pick a date they will remember, like the beginning or end of the year.
  7. Lastly, teach your kids about credit and how to use it wisely. Warn them about the dangers of credit cards and getting into too much debt. Start when they are young by explaining what you’re doing when using your credit cards at the store. Be clear that it’s best to pay them off entirely each month.
  8. If you co-sign for a credit card for your 18 year old, consider a prepaid, debit or very low limit card to start.

Credit problems can have a devastating effect on your child’s financial future. Stay vigilant, watch for the warning signs, and consider an identity monitoring service.

Tim Esterdahl

Tim Esterdahl is the editor of IFCS blog. He is a married father of three and enjoys golf in his spare time.

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