Identity theft is a growing concern for individuals of all ages but an alarming new trend is emerging: criminals are targeting children online to steal their IDs. Child identity theft can have devastating long-term consequences, impacting a child’s financial well-being and credit history well into their adulthood.

According to the latest research, nearly 1 million children were victimized by identity thieves in the past year alone. Experts warn that this is just the tip of the iceberg as child identity theft often goes undetected for many years.

“Kids are particularly vulnerable… the theft of their identity can be a huge problem as they become an adult.”, commented Ari Lightman, a professor of digital media and marketing at Carnegie Mellon University’s Heinz College of Information Systems and Public Policy, in an interview with the Wall Street Journal.

What is Child Identity Theft?

Child identity theft involves stealing a child’s personal information or data and using it to open credit cards or bank accounts, apply for loans, commit cyber crimes like scams, and more. Unfortunately, identity theft that targets children can go unnoticed for many years or even into adulthood. The problem only seems to be getting worse through rising data breaches and sophisticated scams.

Chart about identity theft in the US

“With that unique number, along with a couple of other bits of information, like a name, address and a birth date, a person can do all sorts of things”, explains Jennifer Leach, associate director of the Federal Trade Commission’s (FTC) division of consumer and business education.

“They can get a loan, rent a house, sign up for government benefits, get utilities, a phone, a job—anything that requires a credit check.” In 2023, the FTC handled 22,229 cases of child ID theft in the United States but there may have been many more cases that it missed.

Why are Children Targeted?

First, children typically do not have any existing credit history or financial obligations, making their identities a prime target for criminals who can establish new accounts and lines of credit without detection.

Moreover, children’s trusting nature and lack of awareness about the dangers of sharing personal information online or with strangers. This turns them into an easy prey for scammers.

There is also the growing trend of “sharenting”, where parents frequently post personal details about their children online. This can provide criminals with a wealth of information to exploit.

In many cases, children’s personal data can be compromised through data breaches on the platforms, sites, or apps they use, as well as through the malicious sharing of their information publicly (doxxing).

Disturbingly, in almost a third of the cases involving households that experience child identity fraud, the perpetrator is someone who is close to the child such as a family member or close friend.

“Unless you’re monitoring through an identity-theft protection service, you won’t know your child’s identity has been stolen until they apply for credit or a job,” warns Domingo Guerra, executive vice president of trust at Incode Technologies. “That makes them great targets for attackers.”

The Devastating Impact of Child Identity Theft

The consequences of child identity theft can be severe, both financially and emotionally. According to Javelin Strategy & Research’s 2023 Child ID Theft report, total identity fraud losses tied to children reached $680 million last year.

“It’s a major headache for consumers,” says Tracy Kitten, Javelin’s director of fraud and security and the report’s author. “And it’s a migraine for the financial industry because it absorbs some of the losses, especially when the child’s information is used to create a synthetic identity — a mash-up of details from a real person and a phony one.”

The ordeal of recovering from child identity theft is also painstaking and costly, taking families an average of 16 hours to resolve the matter. This is, at least, 7 hours more compared to how long it takes to solve the issue when adults are victimized.

The impact on children can be dramatic, with identity theft potentially affecting their ability to obtain student loans, rent an apartment, or even secure a job in the future. In some cases, the fraud may go undetected for years, only surfacing when the child becomes an adult and tries to establish their own credit.

Quick Facts and Statistics about Children ID Theft

  • By the time children reach 13, parents will share 1,300 photos and videos of them on social media.
  • 94% of families have no protection in place for their children in case they become victims of identity theft.
  • A quarter of all teenagers, young individuals aged between 13 and 17 years old, experiences some form of scam, fraud, or phishing.
  • The information parents share about their children online will lead to two-thirds of the identity theft committed against young people by 2030.

Preventing Child Identity Theft

Fortunately, there are several steps parents can take to protect their children’s personal information and reduce the risk of identity theft.

The first and most crucial step is to freeze your child’s credit as soon as they are assigned a Social Security number. “Honestly, there’s no downside to keeping a child’s credit frozen or even freezing it when they are a baby”, says the FTC’s Leach.

To place a freeze, parents must contact each of the three credit bureaus – Equifax, Experian, and TransUnion – and request a credit check for their child. If no credit file exists, the bureaus will create one and then freeze it, preventing any new accounts from being opened.

Parents should also sign up for free weekly credit reports at annualcreditreport.com to keep an eye on any suspicious activity and set up a fraud alert, which will require potential creditors to take extra steps to verify a person’s identity before allowing anyone to open a line of credit in their name.

Moreover, when schools, sports teams, or medical providers request a child’s Social Security number, parents should push back and ask why the information is needed, who has access to it, and how it will be secured and stored.

“Never [share it] with anyone who calls, emails or texts and asks for it. Always be skeptical, always give it to someone through a secure means”, Leach cautions.

Finally, parents should be aware that the growing trend of “sharenting” – where parents extensively share details about their children on social media – can provide a treasure trove of data for identity thieves.

Parents should be mindful of the personal information that they share online and avoid posting details that could be used to commit identity theft, such as their child’s full name, date of birth, or school information.

“Parents’ social-media behavior puts their kids at risk”, warns Javelin’s Kitten. “They post where their kids go to school, what sports they play, their names, their birthdays.”

Meanwhile, Professor Lightman recommends that parents provide access to their children’s social media accounts through “mediated” options like Instagram Supervision or Snapchat Family Center, which allow for monitoring and conversations about appropriate sharing.

“There needs to be common ground and a shared understanding between parent and child about what to post, what not to post, in which channel and with whom”, he says.

Recovering from Child Identity Theft

Despite the best preventative measures, child identity theft can still occur. In these cases, parents must act quickly to mitigate the damage.

The first step is to check for any warning signs, such as unexpected bills or letters addressed to the child, denials of government benefits, or collection agency calls. If identity theft is suspected, parents should contact the companies involved, request written confirmation that the fraudulent accounts have been closed, and obtain a theft report from the FTC.

“Act quickly, report what you know, keep notes, if anything must be delivered by mail, make sure you send it certified”, advises the FTC’s Leach.

Parents will also need to contact the three credit bureaus to dispute any fraudulent accounts and have the child’s credit file frozen. This can be a complex process but the FTC provides a customized recovery plan to guide victims through the necessary steps.

“If someone bought a house in a child’s name, it can take a while to unwind. If someone opened a credit card in their name, it should take less time”, Leach explains.

While the aftermath of child identity theft can be daunting, experts emphasize the importance of remaining vigilant and proactive in protecting children’s personal information.

By taking the necessary precautions and acting quickly in the event of a breach, parents can help safeguard their children’s financial futures.