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Intersections Inc. And ITAC Share Findings From Landmark Child Identity Fraud Report

CHANTILLY, Va., Dec. 4, 2012 /PRNewswire/ -- Today, Intersections Inc. (NASDAQ: INTX) and ITAC, the Identity Theft Assistance Center, released the findings from the 2012 Child Identity Fraud Survey Report conducted by Javelin Strategy & Research.  This report takes a deeper look into the crime of child identity theft identifying trends and also exploring the long-term impact this crime can have on children and their families. Specifically, the report found that one in 40 households surveyed had at least one child whose personal information had been compromised by identity criminals and that criminals frequently create synthetic identities to commit these crimes.

(Photo: http://photos.prnewswire.com/prnh/20121204/NE23581-INFO )

"In the past two years, we've seen the issue of child identity theft garner media and consumer attention, but there are many misunderstandings about this crime and more work needs to be done to educate consumers," said Steve Schwartz, President, Partner Services at Intersections Inc. "Reputable studies like this one can help the industry better understand the threats associated with child identity fraud, and in turn help educate families about how to help protect minors and recover from the crime, ensuring a healthy financial start upon reaching adulthood."

Key Findings

  • One in 40 Respondents had a Child who was a Victim of ID Fraud. According to the study's findings, the incident rate of child identity fraud among households with dependents under age 18 is 2.5 percent over the lifetime of the family, or one in 40. This number may be underreported due to the prevalence of family members who may be linked to the crime and would not admit to the fraud, as well as households where victims do not discover their childhood ID fraud until they reach age 18.
  • Victimization Frequently Occurs Close to Home by Family or Friends. Friendly fraud is to blame in many child ID theft cases, and the data shows that 27 percent of victims reported knowing the individual responsible for the crime.
  • A Social Security Number Is the Top Compromised Identifier. Consistent with industry experience, and like adult identity fraud, the study shows that Social Security numbers are the most commonly used piece of information by identity thieves targeting children. Criminals actively seek children's Social Security numbers (SSNs) to create a "Synthetic ID," which can be used to commit financial fraud. In fact, 56 percent of respondents reported theft or misuse of a child's SSN. In fact, 56 percent of victims reported theft or misuse of a child's SSN.
  • Synthetic Identities Most Common Method of Child ID Fraud. The study shows that the most common way that criminals use a child's personal information is to combine a child's Social Security number with a different date of birth to create a fabricated identity that can be used to commit fraud.  Synthetic identities are very difficult to detect.
  • Ch ild Identity Fraud Difficult to Detect and Resolve. The survey showed that these crimes took 334 days to detect and 44 hours to resolve, and 17 percent of children were victimized for a year or longer.  These statistics indicate that child identity fraud is both difficult to detect, and difficult to resolve.

"This survey provides the first solid, verifiable statistics on the causes and consequences of child identity fraud," said ITAC President Anne Wallace. "The results will help ITAC and its government and nonprofit partners improve strategies to prevent and detect child identity fraud and assist victims recover from the crime."

Insight and Recommendations

Increasing awareness and education among parents and children is a key component to preventing child identity theft. The findings in this study underscore the important role that parents must take to protect their child's identity.

Stock quotes in this article: INTX 

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