Kids are a fresh slate when it comes to credit, and that makes them a target for hackers and scammers, according to the Federal Trade Commission and the Better Business Bureau.
That's right — just because your 7-year-old doesn't have a credit card doesn't mean there isn't one open in their name. In fact, by 7, hackers have had years to get ahold of your child's info.
"Last year there were over a million cases of child identity theft. Two-thirds of them were under the age of 7," said Cleveland BBB President Sue McConnell.
McConnell explained that a child's credit history is viewed as a blank slate. "They're more likely to steal that identity," she said.
FTC attorney Adrienne Jenkins added that scammers take advantage of the fact a child isn't checking their credit. "This identity theft can go on for many years before anyone notices the child has a problem," she said.
Their stolen IDs are used just like adults are: used for everything from fraudulent employment to medical insurance coverage. What happens next can range from unpaid debt to high-interest rates on loans or credit cards.
"Then when the child does become of age and chooses to apply for a car loan or student loans or their first apartment, they have a long credit history they weren't aware of," Jenkins said. That's problematic when those are time-sensitive applications.
Child identity theft is a rising issue across the country.
"When there's a data breach, minors have been more affected by becoming victims of fraud, using their data, than adults," McConnell said.
According to the FTC, folks are reporting issues everywhere, and that includes right here in Greater Cleveland.
So what can be done to protect your kids?
"We highly encourage parents to freeze their child's credit because they're definitely not going to be needing it for anything really soon," McConnell said.
"I would definitely advise parents to check their child's credit report, be aware of situations where their credit may have been stolen and to visit our website, identitytheft.gov, and go through the detailed advice on what to do if they find something negative," Jenkins said.
More than half of child identity victims don't find out about the issue until they go to apply for credit, according to Experian.
So, the experts say, don't wait.