Testifying before the House Committee on Ways and Means Subcommittee on Social Security, a staffer from the Federal Trade Commission discussed the agency’s commitment to protecting children from identity theft.
Deanya Kueckelhan, the director of the FTC’s Southwest Regional Office, told lawmakers that protecting consumers – particularly children – “is a critical component of the Commission’s consumer protection mission.” She discussed both the impact of identity theft and the agency’s efforts to combat it on three fronts: law enforcement, nationwide complaint management and education.
Kueckelhan stated that since 2001 the FTC has brought 34 law enforcement actions against businesses that failed to take reasonable steps to protect sensitive consumer information, and she made special reference to the 2006 suit against ChoicePoint, which sold sensitive information about 160,000 consumers – including Social Security numbers – to data thieves posing as clients. The company paid $10 million in civil penalties and $5 million in consumer redress. Kueckelhan also highlighted the recent action against Ceridian Corp. and Lookout Services for violations of the FTC Act for failing to implement reasonable safeguards to protect the sensitive consumer information they maintained. The defendants were required to establish and maintain a comprehensive information security program to protect the security and confidentiality of consumer information.
While millions of consumers are victimized by identity thieves each year, costing consumers and businesses billions of dollars and countless hours to repair the damage, Kueckelhan testified that children’s Social Security numbers are particularly valuable because they lack a credit history and can be paired with any name and birth date.
“In effect, a child’s identity is a blank slate that can be used to obtain goods and services over a long time period because parents typically do not monitor their children’s credit, often having no reason to suspect any problem,” she said. Therefore, “child identity theft is especially pernicious because the theft may not be detected until the child becomes an adult and seeks employment, or applies for student and car loans.”
Kueckelhan told lawmakers about a recent panel hosted by the Commission in conjunction with the Department of Justice’s Office for Victims of Crime, called “Stolen Futures: A Forum on Child Identity Theft,” where participants discussed how to prevent and remedy the problem.
Panelists discussed the causes of child identity theft – typically stolen from schools, government agencies, and businesses, and often by family members who have fallen on hard economic times – as well as potential solutions. The State of Utah experimented with an initiative to designate children’s Social Security numbers with a credit agency to help prevent an identity thief from attempting to obtain credit using the child’s name and information.
Most importantly, panelists emphasized prevention, Kueckelhan said. She encouraged parents and guardians to challenge requests for their child’s Social Security number and other personal information and to understand their child’s use of the Internet and social media so that such information is not accidentally divulged and used to commit identity theft.
To read the text of the Commission’s testimony, click here.
Why it matters: The director said the Commission’s primary goal in co-hosting the forum was to “learn more about the problem of child identity theft and to develop messages and target audiences for outreach on this issue.” In addition to preparing new educational materials like a “back-to-school alert” to inform parents about the importance of safeguarding children’s information, she said the agency “will continue its robust efforts to address all forms of identity theft through law enforcement, partnerships with state and federal agencies, nationwide data management and analysis, and education.”