Protecting Foster Kids’ Credit

By , Posted on Jun 19, 2013
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Every year, more than 26,000 kids in the United States age out of foster care. Remember how difficult it was to navigate through the world when you were 18? Now imagine you had to do it with nearly no support system – and with a mountain of debt in your name, thanks to identity theft. (FTC)

In the past there were no specific laws that protected kids’ credit, particularly the often exploited foster kids.  Well, that changed in 2011 when Congress passed legislation requiring child welfare agencies to get the foster kids’ credit report when they turn 16.  If there are any problems with their report, typically due to identity theft, they will be assisted by child welfare services in the process of clearing it up.

The FTC in conjunction with ChildFocus Inc. and the Annie E. Casey Foundation have put together a free and helpful guide to help deal with protecting foster kids’ credit.  Youth and Credit: Protecting the Credit of Youth in Foster Care.

Child identity theft is not a problem that is only happens with foster children, every child is at risk.  If you are a parent you know the list of worries seems never-ending.  We worry about kid’s physical safety, their education, their futures and a whole laundry list of other things.

Most parents think that at least there is one thing they don’t have to worry about, their child’s financial reputation. Well, unfortunately, they are not out of harm’s way.  Regrettably, from the time our kids get a Social Security number, usually within days of being born, their personal information needs to be protected and watched so they don’t become the target of identity thieves.

You might think it’s ridiculous to worry about the credit of your preschooler, but according to protectmyid.com, “…children and adolescents have become the fastest growing sector of identity fraud victims.” You would think that these kids are unlikely victims however; identity thieves consider them easy targets.

With clean credit histories they are the perfect candidate for criminals to open new credit accounts.  Since kids don’t normally check their credit, the identity theft can go on for years without ever being noticed.  Many of these kids that are victims of identity theft don’t find out until they apply for their first credit card or auto loan.

How horrible would this be for a young adult just starting out in life, to now have to deal with bad credit before they have had the opportunity to mess it up for themselves.  Seriously though, as you may know bad credit could mean they are unable to get a job, financing for a car, obtain a credit card or even denied the ability to purchase a home.

So what can you do to protect your child’s identity and credit?  Well, there are a few simple things you can do to thwart off the identity thief or at least make it much more difficult for your child to become a victim.

Protect your child’s Social Security number like it was your own.  The easiest way for criminals to steal an identity is by obtaining a Social Security number.  There is no need for you to carry your kid’s Social Security card in your wallet.  Keep it in a safe place at home.

Your child’s Social Security number is likely on file at the hospital, their school, and certainly the doctor’s office. But other than these places, do you best to keep your child’s personal information private.

When you sign up you kids for soccer or little league you might be asked for their Social Security number. Be cautious, remember that you have options. If a business, individual, or organization asks for your child’s Social Security number, be proactive and ask them a few questions:

  • Just how will my child’s Social Security number be used?
  • Why do you need it in the first place?
  • What are you going to do to keep it from getting stolen?  Where is it kept?
  • What will happen if I decide not to give it to you?

Many places will agree to go on without getting your child’s Social Security number.  There are many minors who don’t even have a Social Security number yet, and if the organization is reputable, they will want to protect your child’s information.

OK, you have taken every precaution you could think of to protect your child’s identity and credit however, they have still fallen victim.  If this happens, you must take action immediately:

Begin by immediately canceling each account that has been opened.

Contact each credit card company by phone and with a letter sending copies of supporting documents.

  1. File an Identity Theft Report with the police department. The police report will be useful if future problems arise from the theft.
  2. File an Identity Theft Complaint with the Federal Trade Commission (FTC). The FTC can be contacted by phone at 1-877-438-4338 or in writing at:
    Identity Theft Clearinghouse
    Federal Trade Commission
    600 Pennsylvania Avenue, N.W.
    Washington D.C.  20580
  3. Call and report the incident to the three national credit-reporting bureaus listed below. Let them know that the identity theft is associated with a minor who should not have a credit file.
  • Experian, PO Box 1017, Allen, TX 75013; 1888-397-3742
  • Equifax, P.O. Box 740250, Atlanta, GA 30374; 1-800-525-6285
  • TransUnion, P.O. Box 6790, Fullerton, CA 92634; 1-800-680-7289

Be sure to send copies of the Identity Theft Report to each of the bureaus.

“Because most parents never consider identity theft a threat to their children, a criminal’s job is that much easier. Being proactive and regularly monitoring your child/children’s credit reports and/or personal information for the existence of a credit file allows your child to enter adulthood with a clean credit slate, which means you, can cross one worry off your list.” (Protectmyid)

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