Child identity theft: Your child's ID is a big target

Child identity theft can be a bigger problem than other forms of identity theft because it can go unnoticed for years.

A recent Carnegie Mellon study found that 10.2 percent of children under the age of 18 had someone else using their Social Security number. That percentage is dramatically higher than the 0.2 percent rate for adults in the study. 

Crooks are targeting children because the probability of discovering the theft is so low. Children rarely use their Social Security number and parents usually do not monitor the child’s identity.

Thieves can use a child’s identity to open new lines of credit or apply for government benefits. This identity theft can have a devastating impact on a young person’s credit score. 

Many states do not have a system for dealing with child identity theft, but Delaware, Oregon, and Maryland have recently enacted laws that allow parents to establish their child’s credit identity and freeze it until the child becomes an adult. Texas and Illinois are considering similar laws.

A free service also exists from AllClearID called ChildScan. The service looks through employment records, credit records, medical accounts, and criminal records to see if your child's Social Security number has been stolen and is being used. 

The study was based on the identity protection scans on 42,232 children (age 18 and under) in the United States during 2009-2010. The pool of 42,232 child identities includes everyone under 18 in a database of more than 800,000 identity records. 

– Bill Hardekopf is founder of Lowcards.com, an online credit-card information site.