NEW YORK — The note that arrived in the mail, dated March 25 and addressed to my grade-school-age daughter, said what we had expected and feared. Like tens of millions of other Americans, including untold numbers of children, she may have fallen victim to thieves who gained access to Social Security numbers and other personal data from the health insurer Anthem Inc.
In three single-spaced pages, it noted that anyone who had dealt with the company and many Blue Cross and Blue Shield insurance plans over the last decade could be vulnerable. The letter pointed us to anthemfacts.com for more information.
Here’s what the note did not fully address, however: What are the odds that someone will steal a child’s identity? Why would a thief do that, and what exactly can parents do to keep it from happening?
I know better than to overreact to this sort of thing. Before a child’s credit record can be damaged, thieves have to get the data, choose to use it (instead of chickening out), pick yours to use in nefarious ways, and then do so successfully. Still, a 2011 industry-academic study of 40,000 children caught up in a data breach found that someone else appeared to be using 10.2 percent of their Social Security numbers.
So crime like this does happen, and here’s why: Children’s credit reports are clean. That’s attractive to people who want to begin their financial lives anew for any number of reasons. Plus, minors don’t check their credit reports or review bills the way grown-ups do, which means thieves may not get caught for years or decades.
One way that people can protect themselves from many kinds of identity theft is to put a freeze on their credit reports with Equifax, Experian, and TransUnion, the three agencies that make a lot of money tracking financial histories and selling the data to companies we want to do business with.
A credit freeze is more stringent than the more popular fraud alerts that many consumers have used. Putting your reports on ice means that any new creditor trying to open an account in your name won’t have access to your credit report unless you go into the system and thaw it. Without seeing your credit report, companies that you are not already patronizing generally won’t open an account in your name.
The problem with the freeze, however, is that you need to have a credit report in the first place before you can freeze it. Most children don’t.
In the last few years, though, that’s been changing. According to Heather Morton, a program principal with the National Conference of State Legislatures, 19 states now require the credit agencies to help parents and guardians create a new credit report for a minor child for the express purpose of immediately freezing it. None of the states are in New England.
Freezes won’t stop every kind of theft, alas. Thieves sometimes use children’s Social Security numbers and other data to file fake tax returns and get illegitimate refunds, access health care, and work legally, even if they are not citizens. In each of those instances, there may never be a credit check that reveals the freeze.
So how can we keep our private data private? Don’t carry around Social Security cards. Lock them up at home. Keep your child’s date of birth off social media. Talk to your offspring about where to click and not to click on websites and in incoming e-mail. Question school officials and doctors who want children’s Social Security numbers for forms, as it may not truly be necessary.
One other problem is that in some cases, the children’s parents commit the identity fraud.
They may do this out of desperation, having already wrecked their own credit or experienced some financial calamity.
So what could stop them? One potential approach is called the 17-10 registry. The idea here is that when children are born, their Social Security numbers go into a “do not break the glass until two months before age 18” database. Parents could be prohibited from stopping it, and credit reporting agencies would hopefully crosscheck it before letting anyone use any Social Security number.