How to freeze your child's credit report

As of January 1, 2016, parents now have the ability to place a security freeze on their child’s credit report.  A security or credit freeze is one of the best ways a parent can insure that criminals or other family members will not be able to use or establish credit in any child’s name under the age of 16.

Children’s credit is especially alluring to unscrupulous individuals because it is a clean slate.  Stealing a child’s identity is easier than you think.  All a criminal would need is the child’s social security number and they can falsify any other needed information.

Where would they get access to this information?  The main culprit is through school related activities.  Registering for school, summer camps, insurance forms and other activities provides criminals with access to a wealth of information.  Even the IRS was recently hacked and millions of social security numbers were stolen from tax returns, including children’s social security numbers.

What can they do with the stolen social security numbers?  The thief will establish credit cards, set up utility services, rent a house or apartment or any number of credit dependent activities.  The theft is usually not discovered until the child is older and trying to apply for credit themselves, a parent happens to run a credit report or a bill comes in the mail in the child’s name.  The youngest reported identity theft victim was one month old.

What can you do to protect your child’s future credit?

1. Take advantage of getting a free report from each of the 3 credit bureaus yearly. To get the max value out of this benefit, space out the requests. For example, in January, request a report from Equifax, then maybe in May request one from Experian, and finally in September get one from Transunion.  This is a prudent practice to do yearly with your own credit reports as well!
2. Contact each of the credit bureaus, either online or by mail and request that a freeze be placed on your child’s credit file. Please be aware that it may cost up to $5 per bureau to get the freeze in place, but it is well worth the money.
3. When setting up the freeze, establish a PIN or password that is known only to you and your spouse. By doing this step, it will trigger an alert whenever someone tries to access their file or establish credit in their name. The inquiring entity will be denied and advised that the file is frozen. When your child is older and ready to establish credit, you can lift the freeze via the password or PIN, so do not forget or lose the information.  Put a copy of this info and the date established in a safe place.
4. If offers have come in already offering credit in their name or to stop future offers from starting, you can stop most credit offers by going to optoutprescreen.com or call (888) 5-OPT-OUT.

These methods may not be 100% fool-proof, (especially if a family member is involved), but it can make it harder for someone to ruin your child’s credit before they get to adulthood.

Child ID Theft Prevention

Most parents don’t think about their child’s credit file while their child is young.  Parent’s days are filled with ensuring their child’s physical safety and providing emotional support.  But with today’s economy making people more desperate and bold, along with the current laws regulating credit, more children are becoming victims of identity theft.

According to a study done in 2011 by Id Analytics, approximately 10 percent of children are victims of id theft or social security number abuse compared to less than 1 percent of adults!  Since many companies aren’t required to cross-check a creditor’s name, birthdate and social security number, it leaves the door open for anyone to fraudulently open credit cards, loans and other types of credit in a child’s name.  It is up to parents or the child’s guardians to check the child’s credit file on a regular basis.  Here are some simple steps to follow:

1. Contact the credit bureaus (Equifax, Experian and TransUnion). Ask for a manual search using your child’s name and social security number.
2. Watch for credit offers in your child’s name that come in the mail. This is usually indicative that there may be existing credit somewhere and should be a red flag.
3. Teach your children that they are NEVER to share information such as birthdates, addresses and social security numbers with anyone outside the family or without your permission.
4. Monitor who they interact with via text, social networks and emails.
5. If you should find that someone has fraudulently opened credit in your child’s name, file a fraud alert and request a credit freeze immediately with each credit agency. Next, call your local police department and file a report.
6. After the credit company and the police have completed their investigation, they may be able to bring criminal charges and prosecute the person who stole your child’s identity. Be sure to ask the court and law enforcement for a certificate of clearance.  Be sure it is included in each agency’s files on your child and include a written statement.

Child safety involves more than just a child’s physical safety from child predators and bullies.  In today’s technological age, parents have to be vigilant to the cyber threats a child may face when interacting online.  With just a little misplaced information, a criminal can wreak havoc on your child’s future credit when they reach adulthood and make their lives difficult.  So enlist your child’s help now, to protect their future, by teaching them the importance of information discretion!