Identity theft involves the unauthorized use of another person’s identifying information for fraudulent purposes, such as opening bank or credit card accounts, getting loans or government benefits, or renting a home. This can affect people of all ages, but perpetrators may be inclined to target children because they have no credit history. Also, the theft may go unnoticed for a long time because parents usually do not think about checking their child’s credit. Debts may accumulate for years, leaving children severely burdened when they become adults.
To reduce the risk of identity theft, parents should limit the instances when they provide their child’s Social Security number or other identifying information. They may want to ask the entity requesting the information about the steps taken to protect it. Parents should carefully secure any papers containing the personal information of their child. When they get a new computer or cell phone, they may want to erase any information that the old device contains.
Identity Theft by Family Members
Unfortunately, family members and friends sometimes perpetrate identity theft against children. For example, they may be tempted to steal the Social Security number of a child to work around their own credit problems.
Recognizing and Responding to Child Identity Theft
Parents may want to watch for signs that child identity theft may have occurred. These may include bills or credit card offers addressed to the child, as well as calls from collection agencies. Parents may receive an IRS notice that their child’s name or Social Security number appears on another tax return, or they may be denied government benefits because someone else is getting those benefits by using the child’s Social Security number.
If a parent notices some of these red flags, they can ask the credit reporting agencies (Equifax, Experian, and TransUnion) whether their child has a credit report. This may involve submitting certain documentation to the agencies. If there is no credit report, this should ease their concerns. If there is a credit report, identity theft may have occurred.
A parent who discovers identity theft affecting their child should take certain steps. They should close the accounts at companies where fraud occurred and get confirmation from those companies that their child is not responsible for the accounts. Parents should ask the credit reporting agencies to remove the fraudulent accounts from their child’s credit report. They also may want to put a security freeze on their child’s credit report, which can help prevent identity thieves from opening new accounts in the future.
Legal Recourse for Child Identity Theft
All states have laws prohibiting identity theft, and a majority of states require defendants convicted of this crime to pay restitution to victims. In addition, parents can bring a lawsuit against the person who committed the theft. (Or the child can bring a lawsuit if they discover the theft after they turn 18.) However, sometimes the perpetrator cannot be found or does not have the financial resources to pay compensation. Parents then might be able to sue an entity whose failure to protect the information led to the theft. For example, a data breach at a corporation or government entity could result in the exposure of identifying information. Damages may account for both economic and non-economic harm resulting from the breach.
Sometimes a data breach affects many children or other individuals. When this happens, a child may be able to join a class action. In this type of litigation, one or more plaintiffs pursue a lawsuit on behalf of a large group of people who suffered the same type of harm. A class action may be an efficient way to receive compensation when each consumer has not incurred substantial losses individually. Class actions must meet certain requirements, which may involve the uniformity of the legal or factual issues across the class and the adequacy of the class representative in protecting class interests.