JACKSONVILLE, Fla. -- When was the last time you checked your credit report? The recommendation is to check it every year. But you should also be checking your kid's credit file too. Many times parents don't know if their children are victims of ID theft until it's too late.
Babies start life with a clean slate. One of their first official documents is a Social Security number. A number, if in the wrong hands, can ruin your child's credit and parents not even know it.
Crooks can access the number by creating viruses to search your computer for tax and health records containing your child's Social Security number. Email phishing is another technique. Social Security numbers can also be purchased online for as little as $40. But the majority of Social Security numbers are stolen, surprisingly, by relatives. "Studies vary but it's between 80% to 90% of identity fraud happens by a friend or family member unfortunately," says Martha Cox, Vice-President of Family Foundations, a financial, family and education organization in Jacksonville. Armed with your child's Social Security number identity thieves will set up a fake account to establish a credit history.
This is how they do it. They'll go to businesses like a utility or cell phone company and give the clerk the number along with a fake name and date of birth. The clerk checks for credit and finds no file because it's never been used. But the clerk may open the account anyway if a cash deposit is put down and then sends the info to the credit bureau. There you have it, a new record linking your child's social security number with a different name and date of birth.
From there the thief builds up the credit account, maybe taking out one loan to pay off another, until one day he decides to "cash out" and all the accounts go into collections. All this goes unnoticed until your child applies for credit, an educational loan, apartment or phone. Now your child faces the long process of repairing his credit that someone else ruined.
So how can parents avoid their children be a victim of identity theft? First, check your child's credit every year "As we encourage people to check your adult credit history on a regular basis you should at that same time check your children's Social Scurity numbers just to make sure there's nothing there," says Cox.
Keep your child's profile on social networking sites free of private information, make sure anti-virus software and spyware is installed on your computer, don't give out your child's social security number unless absolutely required and check your mail for unusual letters that can be a sign of identity theft. And finally, talk to your kids about safety and security while online. Follow these steps to make sure your child's credit stays clean and out of the hands of crooks.
The Federal Trade Commission has printed a comprehensive booklet called "Taking Charge. What To Do If Your Identity Is Stolen." It outlines how to avoid identity theft and steps to take if you or your child's identity is stolen. You can pick up a copy at Family Foundations at 1639 Atlantic Boulevard in Jacksonville.
Here are the links to check your child's credit file from the three credit reporting agencies.