My 10-week-old son Ben has the biggest smile, is a champion sleeper and just had his identity stolen by hackers.
The recent data breach at Anthem, Inc. was brutal. The company, America’s second largest health insurer, announced that approximately 80 million individuals were hacked. And the stolen personal information is invaluable — names, birthdays, Social Security numbers, street addresses, email addresses and employment information, including income data. This is the DNA of a modern financial identity.
Baby’s First Data Breach
Millions of Anthem customers breached in this cyberattack are children. And this breach is for life. For as long as hackers keep, share or sell these stolen files, the financial identities of hacked children are vulnerable to abuse.
Anthem announced that it’s providing two years of credit monitoring to all 80 million breach victims through a third-party vendor. Customers who are victimized by identity thieves can apply for free access to Anthem’s chosen ID theft repair program.
It’s important to remember, however, that the free credit monitoring and identity theft services only last for two years, even though the identity theft danger will last longer. Unfortunately, Anthem is not offering children or their parents coverage beyond two years.
The situation just created an enormous burden for parents like myself who must now add “credit report and identity theft monitoring” to our list of parenting responsibilities and anxieties. Stolen credit card numbers can be changed, but hacked names, birthdays and Social Security numbers are permanent features of an identity.
Everyone knows that good credit reports and scores are absolutely essential for employment, housing, banking and more. Who wants to be the parent that encumbers their child with a stolen identity and destroyed credit report at the start of their adult financial lives?
The reality of cybercrime is that children are attractive targets for identity thieves. First, no one is really paying attention to their child’s credit reports and scores — or aware of whether their child even has them. Whereas an adult with existing accounts might be flagged by an avalanche of new accounts, an identity thief might get away with using a child’s pristine credit for up to a few weeks before new accounts start registering and credit limits are flagged.
Secondly, most children aged 13 and older typically have “clean” credit records that lack any negative information in the files of the big three credit reporting agencies: Equifax, Experian and TransUnion. By exploiting a child’s “clean” credit record, an identity thief can virtually guarantee some sort of credit approval, even if for a smaller amount (e.g., less than $5,000) and onerous credit terms. So an identity thief can “churn and burn” a child’s credit history quickly with as many accounts as possible in a short period of time.
How to Safeguard Your Child’s Identity
There are a handful of ways parents can protect their children’s identity, but they all require time and more time. Here are some key tips to safeguard your child’s identity.
1. Lock Down Existing Accounts
If your child has a financial account of any sort (i.e., Treasury savings bonds, 529 college savings, sub-account credit card), always read the monthly statements within one week of receipt. The statement is the first line of defense if a thief has gotten access to an existing account of the child. Sometimes patient identity thieves will make one or two small “test charges” on an existing account over a period of weeks or months to see if any adult is paying attention. If no adult flags the account, it’s a freebie for the thief.
2. Watch for Warning Signs
The most destructive frauds will occur when the stolen Anthem data is used to open new accounts or apply for benefits in the child’s name. Privacy expert Bob Sullivan writes, “It’ll be crucial for all Anthem consumers to monitor their credit reports for new accounts — not only today, but next week, next month, next year — and sadly, forever.”
The Federal Trade Commission has a list of warnings signs that a child’s information is being used fraudulently, including collection calls or unexplainable bills in the child’s name, notices from the IRS, and denial for government benefits because your child’s Social Security number is already in use. Also, don’t assume letters addressed to your children are junk mail; a sudden influx of pre-approved credit offers in your child’s name should be a red flag.
3. Monitor Credit Reports
Check the credit reports for all adults in your house. Then, check to see if any credit reports exist in your children’s names. Unless you’ve given your child a credit card under your account, or applied for loans or governmental benefits in their names, they shouldn’t have a credit report.
According to AnnualCreditReport.com, “The credit reporting companies do not knowingly keep credit files on children under 13.” The website has more information about requesting a file for a child. Adults can also use free tools like the monthly credit report summary on Credit.com to automate the monitoring process and watch for suspicious activity.
4. Report All Identity Theft
Identity theft is a crime and if your child’s identity has been stolen, you should report it to the police. You may need to file the report in person and provide supporting identification and documentation. To bolster your evidence trail for the police, file a complaint at FTC.gov, print your “Identity Theft Affidavit,” and include it in your police report.
As you work to repair your child’s credit, the police report will be essential for removing unauthorized accounts. Finally, if the identity theft has caused serious damage, you may also consider hiring an attorney to enforce your child’s privacy rights.
Inevitably, children’s identities will be stolen as a result of Anthem’s breach. The best parents can do is put up as many defenses as possible and continue to monitor their children’s financial identities forever.
More on Identity Theft:
- Identity Theft: What You Need to Know
- How Can You Tell If Your Identity Has Been Stolen?
- What Should I Do If I’m a Victim of Identity Theft?