BALTIMORE — Children shouldn't have credit reports. They don't have credit cards, own a home, or a car, and yet, there may be a credit report in your child's name if they're the victim of identity theft.
In 2017, more than 1 million children were victims of identity theft or fraud, according to a Javelin Strategy & Research report. Two-thirds of those affected were age 7 or younger.
"It is counterintuitive, but these ripoff artists would much rather have the identity of a 5-year-old kid than a 40-year-old man and the reason for that is they can create an identity, get credit in that person's name, in that child's name and use it for 15 years before anybody becomes aware of it," said Maryland Attorney General Brian Frosh.
Simply obtaining a child’s social security number allows scammers to open new accounts or make big purchases and run up a lot of debt.
The Social Security Administration has recently started digitizing its systems, which should cut down on some fraud. Still, lenders more often check with credit reporting companies for a credit report instead of verifying Social Security numbers and ages with the government.
Protecting your kids:
Don’t give out their Social Security number even to close friends. Studies show family friends are the most common suspects in child identity theft cases.
Make sure you password protect digital documents that contain personal information such as birth certificates and tax returns.
Freezing your child’s credit can also prevent new accounts from being opened in their name, but this can only be done in certain states.
In 2012, Maryland became the first state in the country to give parents or guardians the ability to freeze a child's credit report. This is one of the easiest ways to ensure you child enters adulthood with a clear credit history.
And as of last September, it's now free for everyone to freeze or unfreeze your credit at the three major credit bureaus. For more information on freezing your credit report, click here.