The summer vacation season is officially upon us. That means kids will have more time to spend on the Internet, on social media or doing some online shopping—most likely with a debit card or a parent's credit card.
However, what many parents don’t realize is that these behaviors are some of the causes of child identity theft and fraud.
Of the 25,000-30,000 fraud cases handled by Experian® each year, about 17% were targeted at children. According to Michael Bruemmer, Vice President of Consumer Protection for Experian, child ID fraud or theft, will affect 25% of kids before turning 18.
“Social media sites and other sites kids go to—whether for fun surveys or to download or play games—often ask for personal data, and kids don't think anything of providing their birthdate and other personal information,” Bruemmer says. “And when buying items online, they don't always consider whether the site is secure and encrypted. This puts them at risk.”
A Target Even at Birth
How early can children be targeted? It starts at birth with the creation of a social security number.
“These days many people apply for their newborn’s social security number right in the hospital as they complete the birth certificate,” Bruemmer says. “The social security number is an identity marker they'll have for life—but it now also makes them vulnerable.”
Identity thieves can use a social security number to apply for government benefits, loans, utility services, rent a place to live and open bank and credit card accounts. “Since kids under the age of at least 16 have no need for a credit file, parents never have any reason to check to see if a report has been created in their child's name,” Bruemmer says. “But one can be created and no one would know.”
Another reason children are targeted is their pristine credit file. “Kids have a virgin identity. A social security number with no activity on it opens a child up to risk and because kids have a clean slate, credit-wise. An identity thief can do a lot with a clean credit file,” Bruemmer says.
Watch for These Warning Signs
According to Bruemmer, there are a number of red flags that would indicate that a child's identity has been tampered with. “If you receive credit card offers in a child's name—where one was not requested—it could mean a credit report has been created in their name.”
Other warning signs include receiving an IRS notice saying that your child didn't pay income taxes or that the child's social security number was used on another tax return. Still another is receiving collection calls on bills for products or services that you never ordered or received.
Key Strategies for Parents
But even with the number of reported child identity crimes increasing, there are steps parents can take to help protect their children's identities.
First, be very aware of who you—or your children—are sharing personal information with and where. “It’s important to teach kids the importance of withholding personal information on social media sites,” he warned.
But the advice is not limited to online sites. “Even at school, if your child is participating in sports or other extracurricular activities, they are often asked for personal information. You need to be sure of how that information is being used and who has access to it.”
Next, take advantage of third-party services that help monitor credit reports, even for children. “Looking for the creation of a credit file or a credit report—and offering continued monitoring for theft and fraud are features that any ID protection service should include,” he says. “As well as ongoing monitoring for other changes, like a change of address that you didn't make, which is also a sign of trouble.”
Helping Keep Your Family’s Identity Secure
In response, Morgan Stanley’s Premier Protection offered through Experian, a benefit of the Premier Cash Management program at no cost, offers free access to Experian’s ChildSecure® program, which provides monthly monitoring and email alerts if an Experian credit report is detected for any registered child under the age of 18.
Other Premier Protection benefits for Premier Cash Management clients include monthly Experian summaries, and three-bureau credit reports and credit score1 updates, as well as credit score trending reports, identity theft insurance2, constant Internet monitoring for social security number or credit and debit card number use, and lost wallet/card replacement. Premier clients also have access to experienced Customer Service Representatives who help resolve issues involving identity theft or fraud.
For more information on Morgan Stanley Premier Protection with ChildSecure® from Experian, as well as all of the benefits of Premier Cash Management, speak with your Morgan Stanley Financial Advisor. If you don’t have a Morgan Stanley Financial Advisor, find one near you using the locator below.