Not Playing Fair


Children are often subject to more danger than that of adults – especially when it comes to identity fraud. Fraudsters find it easy to steal Social Security Numbers from children, and it is difficult for the government to catch these schemes because children do not file tax returns until they are older. This not only results in years of undetected fraud, but in years of anguish for the children who are victimized.

An article by The Chicago Tribune recently documented the problem. According to the piece, the government took steps last year to help prevent identity theft by issuing random Social Security Numbers. This was a change in the past practices, which involved issuing Social Security Numbers based on a specific pattern related to the birth dates of children. Fraudsters had caught onto the pattern and were able to use the predictable Social Security Numbers to perpetrate tax refund fraud. (This is exactly what Andy has been saying – without the children filing tax forms, this type of fraud goes undetected for years.? This leaves all kids open to being victims. (Can you imagine having five to 10 years of bad financial history before you became an adult? It could take years to rectify.?

In addition to identifying the pattern of kids’ Social Security Numbers, thieves also have been caught hacking computers and stealing Social Security cards. And, they have the upper hand in the situation because the age of the applicant cannot be verified by the credit issuers based solely on the Social Security Number. Imagine being a 16-year old unable to get a job because your credit report incorrectly indicates that you have bad credit and a criminal history. (This is a red flag.)

The article cited comments from an executive in the credit reporting industry, who noted that his company – and many like it – offer services to monitor children’s identities so they are not subject to this crime. While companies are trying to assist parents in protecting their children, it is ultimately up to the parents to keep track of their children’s Social Security cards, so they don’t get lost. (Dah! Wake up parents!? Also, parents should refuse to give out their children’s Social Security Number when asked. (In many cases the requester may fuss, but will usually work without it.)

It’s interesting to think that we raise our children to be polite, show manners and play fair. Often, adult fraudsters seem to have forgotten those life lessons and take advantage of children. Perhaps we could all use a lesson in playing fair – I’m sure jail can teach identity fraudsters the ground rules.

Source: Today’s ”Fraud of the Day” is based on an article entitled, ”Not Even Kids Safe from Identity Theft: When Children Are Victims, Crime Can Go Undetected for Years, Experts Say,” written by Joseph Ruzich, published by The Chicago Tribune, January 25, 2012.

Millions of cases of identity theft are reported in the United States each year.

And although most of the victims are adults, children are not immune to having their identities stolen.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.