July 12, 2011
More Than 140,000 Children Could Be Victims of Identity Fraud Each Year
SAN DIEGO, July 12, 2011 /PRNewswire/ -- For most people, the thought of their children being victims of identity fraud is even more chilling than being a victim themselves. While children are less at risk for identity fraud than adults, when it happens it can be much more devastating because the fraudulent activity can go undetected for years, making it all that much harder to restore the victim's good name. A new ID:A Labs study from ID Analytics found that a startling 140,000 identity frauds are perpetrated on minors each year.
The ID:A Labs study is based on a review of over 172,000 children whose identities were protected through ID Analytics Consumer Notification Service (CNS) from April 1, 2010 to March 31, 2011. CNS directly connects consumers and companies to alert consumers in real-time when their identity is used for consumer transactions, potentially without their permission. In addition to the rate of child identity fraud, the study also found:
- Credit card and wireless activity most common--60 percent of the potential fraudulent identity use alerts sent to minors originated from the credit card industry. The vast majority of the remaining alerts were from the telecommunications industry, mostly wireless providers.
- Take the alerts seriously--minors who received an alert through the service were seven times more likely to experience fraud than an adult. They received 0.5 percent of the identity use alerts, but yielded 3.5 percent of the cases of fraud.
Osherwitz will speak about these findings and child identity fraud today in Washington DC at "Stolen Futures: A Forum on Child ID Fraud" sponsored by the Federal Trade Commission (FTC) and the Office for Victims of Crime (OVC), Office of Justice Programs, U.S. Department of Justice.
Understanding the Methodology
To provide greater insight into the scope of child identity fraud, ID:A Labs conducted a study of more than 172,523 children enrolled in ID Analytics' Consumer Notification Service at some point during the 12-month period, from April 1, 2010 to March 31, 2011. Seventy percent of the enrolled minors were 13 or under. Parents and/or custodial guardians of the enrolled children identified over 600 possible cases of child identity fraud, 330 of which were confirmed by credit card issuers and service providers as actual identity fraud. In total, 55 percent of the possible fraud cases identified turned out to be fraud.
Because the CNS leverages the actual use or misuse of identity information, and is therefore able to operate independently of credit reports, it fills a historical gap in child identity theft protection by allowing parents to monitor the use of their child's identity information to detect use or misuse. Through the CNS, ID Analytics monitors real-time transactions throughout the United States for use and misuse of a child's SSN, name, date of birth, or other information. While adults have historically had access to credit monitoring services built on credit files, the CNS now provides parents and guardians with visibility into the real time use of their child's personal information.
When the unauthorized use of an identity is discovered, the CNS provides consumers with a mechanism to say "that's not me" and shut down the application, often before it is approved and can result in harm.
About ID:A Labs
ID:A Labs reveals important trends in consumer behavior by examining identity use to help organizations better manage both the risk and opportunity of an individual consumer. ID:A Labs is a multidisciplinary group of mathematicians, computer scientists, economists, financial experts, cognitive scientists and advisors from ID Analytics and other respected institutions.
ID:A Labs conducts research and analysis in the areas of identity fraud, credit risk, marketing and segmentation, authentication and identity proofing. The Labs leverages the ID NetworkÃ®, the nation's first network of cross-industry consumer behavioral data. Backed by patented technology, world-class analytics and the ID Network, ID:A Labs researches, analyzes and reports on developments in consumer behavior, identity- and credit-related issues, the regulatory landscape and innovations in analytics around modeling and machine learning.
About ID Analytics, Inc.
ID Analytics is transforming consumer risk management with patented analytics, proven expertise, and real-time insight into consumer behavior. By combining proprietary data from the ID NetworkÃ®--one of the nation's largest networks of cross-industry behavioral data--with advanced science, ID Analytics provides unprecedented visibility into identity risk and creditworthiness. Every day, the largest U.S. companies and critical government agencies rely on ID Analytics to make risk-based decisions that enhance revenue, reduce fraud, drive cost savings, and protect consumers. Please visit us on the web at www.idanalytics.com.
ID Analytics is a registered trademark of ID Analytics, Inc. All other trademarks and registered trademarks are the property of their respective holders.
SOURCE ID Analytics, Inc.