The Federal Trade Commission reports that about 500,000 children and teens have their identity stolen each year. Sixty six percent of the time, their identity is stolen by their parents.
"We have seen that. A lot of times they're maxed out and nobody will give them credit, and they're getting desperate," said Wayne Knutson, branch manager and counselor of Consumer Credit Counseling Service. "We see it a lot with telephones, where their phones have been shut off so they get a new phone in one of their child's names to get going again."
Children are so susceptible to identity theft because their credit is clear. Plus, most children are now issued Social Security numbers early in life, often at birth.
There are a number of places children's personal information, including Social Security numbers, may be vulnerable, including hospital records and physicians' offices, school records, day care centers, library cards, sports team applications and online social networks.
Because a lot parents don't check to see if their child has a credit record, the crime can go undetected for years. Many cases of child identity theft aren't discovered until the youngster applies for a driver's license or first job.
"Most kids don't check out their credit," Knutson said. "They don't find until they're out on their own, starting their own life."
Lori Uribe, also a counselor at Consumer Credit Counseling Service, said she child ID theft can be devastating.
"I've counseled some adults who may be purchasing a home for the first time - I do the first time homebuyer's workshop. In the workshop, they've told me this has happened to them (as children) and they asked me what they can do," Uribe said.
According to the Federal Trade Commission, consequences child identity theft victims face include:
Difficulty getting accepted into college.
Difficulty in opening a savings account.
Difficulty in applying for a driver's license.
Inability to land a job.
Getting collection notices in the child's name.
Lost and damaged credit.
Having arrest warrants in your child's name.
Recovering from it as an adult can be difficult, both said.
"They could file charges. However, most of them don't because it's usually a family member," Uribe said.
Knutson said people also can dispute with the agency or put a 100 word statement on a credit report to explain your situation. People can dispute that they're not liable for their bad credit because they were underage when it occurred.
"But then the credit card company needs to press the charges," Knutson said.
