Parents should be aware and check their child’s credit history. A new federal law going into effect in September will make it easier for families to combat the growing problem of identity fraud of minors. Parents can now make inquiries about credit files in their child’s name and freeze a file at no cost.
Data-security experts say children are increasingly targeted by thieves who steal social security numbers to create fake identities. They then apply for credit cards and take out loans using the stolen social security number. Experian estimates that one in four children will be affected before they become an adult. Criminals see the clean credit history of a child as very attractive because parents rarely check the credit history of the children. That can allow the theft to go on for years before being detected.
Young children do not have credit files unless parents open them or, someone committing fraud did. Once a child’s personal information is stolen, cleaning it up can be difficult.
Once the new law goes into effect in September, parents should contact the three main credit-reporting companies and check on the credit files of their children. Parents should open credit files for the child and then freeze it. The credit reporting system us built on the idea that the first person to claim an identity is that person. Protect the credit of your children!