Common Sense Approach to End Child Identity Theft

Customer Service Agent:

“Someone, and I don’t know who, they have [an] account in your name.”

Customer:

“It was probably my mother.”

The above excerpt is an example of a problem that David Howe, president of SubscriberWise, sees way too often in his other role as credit manager for MCTV, an Ohio-based, last-mile provider of broadband and cable services. Howe, who spoke at the 2016 IP Vision Conference and Expo regarding big data, analytics and its application to risk mitigation, discusses the problem of child identity theft in the above interview.

With over 20 years in credit collection, Howe has been involved in over 1,000 cases where an adult will open an account using a minor’s Social Security number. The adult’s subsequent non-payment then ruin’s the child’s credit. Unfortunately, this identity theft is often undetected until years later when the minor is an adult.

How big is this problem? Howe suggests that less than 1/10 of one percent of credit filings are identified as belonging to a minor, which, according to the FTC’s data for 2015 means 20,905 cases of identity theft for those people 19 years and under. Although these figures sound relatively small, the individual impact can be devastating to the young adult who cannot get credit, is denied college entrance or is not hired.

It is doubly devastating when the thief is the parent, as the victim not only has to undertake the hassle of cleaning up her credit, she must deal with the emotional toll caused by the betrayal of someone who is supposed to be her protector. Solving via the criminal justice system isn’t necessarily the answer, as the prosecutors may not even be willing to pursue even relatively clear-cut cases, as Howe has found.

Howe has been pushing for Congress (via proposed legislation) and the White House (via Executive Action) to solve this through a relatively simple process that would identify that a given Social Security number is associated with a minor, letting creditors know not to extend credit to imposter applicant.  There is precedent for this type of mechanism as it exists for determining Social Security numbers associated with deceased individuals (see this YouTube video as an example of how it works).

Howe suggests, “Our goal is to find a common-sense solution that uses technology and education where we can stop this upfront before we end up with a potential liability and harming the child in the long-run.” Howe’s call for action on this issue should be a wake-up call to Communications Service Providers, legislators and parents.

[Note, the FTC has tips for parents to ensure the integrity of their child’s credit. Especially relevant is their final tip suggesting parent’s check their child’s credit rating when they turn 16, as that will give the child time to fix any issues before they turn 18.]