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The Resource Center Child Identity Theft & Protection | post

Child Identity Theft – 140,000 Victims Each Year

by Neal O'Farrell on

The problem of child identity theft is growing. Today, Neal O’Farrell, Intersections’ Consumer Security Adviser, shares his thoughts on a study published by ID Analytics that sheds some light on the scope and size of this growing problem.

140,000 victims of child identity theft each year. That was the sobering and troubling conclusion of a recent analysis by data analysis firm ID Analytics, who reviewed the records of more than 172,000 children whose identities were being protected by a service offered by the firm between April 2010 and March 2011.

The report supports other studies that have found the same troubling trend, as well as a growing awareness in the cybercrime community of the value of child identities and the ease with which they can be compromised.

And some children are obviously more vulnerable than others. In another recent blog, I talked about a story in the Sacramento Bee newspaper in Northern California which reported that of the 60,000 foster children who leave the California foster care system every year, as many as one in every five discovers they have been a victim of identity theft.

Many of these vulnerable kids, who may have already endured years of abuse and disappointment, go out into their adult lives weighed down by debt that belongs to someone else. And in most cases the thieves turn out to be either their natural families, their foster families, and in some cases the professionals being paid to protect them

According to ID Analytics, while the risk for identity theft is still higher for adults, child identity theft can be much more devastating because it can go on for years without being detected or challenged.

The study also found:

  1. Credit card and wireless activity were the most common problems. 60% of child fraud was connected to credit card abuse, which most of the rest was related to wireless providers - we assume thieves are using stolen child identities to pay for wireless service. This service is then used in many cases to conceal other criminal activities.
  2. Minors and their caregivers should always take security or fraud alerts seriously, because minors who received an alert were seven times more likely to experience fraud than an adult.

“Child identity fraud poses complex challenges to consumers, businesses and regulators. Unfortunately, minors’ identities are particularly appealing to fraudsters because their personal data is untainted, legitimate and less likely to be monitored for misuse,” said Tom Oscherwitz, chief privacy officer at ID Analytics. “This new study finds that child identity fraud is more than a hypothetical risk. Well over 140,000 U.S. kids are victims of the crime today. Our children need better protection. A comprehensive solution to child identity fraud requires a layered approach reflecting advances in technology and business processes, legislative guidance and consumer education.”

And while child identity theft is now being taken very seriously, we should still only expect it to rise. More than a year ago I wrote about the problems of the legal sale of child identities online, offering packages of what were called Personal Credit profiles ostensibly to conduct evaluations of child credit worthiness.

While there is no law against the sale of this information, it seems that most of the purchasers were using the information to either steal identities or repair badly damaged credit histories by stealing the clean credit records of kids.

There's a reason why kids and the elderly are so often targeted by thieves. They are simply the most vulnerable, and targeted by the most heartless. We need to increase our focus on the protection of these vulnerable groups, and with a real sense of urgency.