Foster Children Identity Theft Article Series

We have covered three cases of foster child identity theft here and the new US Legislation to help combat it here. Now a new series Burdened Beginnings looks at more cases. The first looks at California cases Foster Children Struggle To Recover From Identity Theft [Huffington Post 12/2/11 by Gerry Smith]

Mercediz Hand discovered after aging out of foster care that “someone had been using her identity since she was 10, taking out a mortgage and racking up $3,000 in unpaid cellphone bills.

Her credit was ruined. This summer, she slept in her car, a 2002 Chevrolet Monte Carlo, because she could not qualify for an apartment. Then her car was repossessed because she defaulted on a loan with a 21 percent interest rate — the lowest rate that lenders would offer. She finally found a landlord who did not check her credit, but she wants to move because her apartment is infested with roaches and termites.

Sitting outside a coffee shop on a recent afternoon, the 24-year-old mother of two said she is considering filing for bankruptcy.”

New Law and Its Flaws

This fall, President Obama signed a law with a provision that requires all states to run credit checks on older foster children and help resolve cases of identity theft before they age out of the system.

But experts say that is not enough. The real problem, they say, is that foster children’s Social Security numbers are overexposed. Matt Cullina, who has adopted three foster children, said he receives five to seven ID cards each year that include their full name, date of birth and Social Security number — more than enough information to commit identity theft.

“There’s probably no other segment of the population that has ID cards with those three pieces of information on it,” Cullina, chief executive of Identity Theft 911, said at a July forum on child identity theft.

Rep. James Langevin (D-R.I.) has introduced legislation, the Foster Youth Financial Security Act, that goes further by prohibiting states from using Social Security numbers to identify foster children. The bill, which is still pending, would help protect foster children from identity theft by reducing the public exposure of their sensitive information, according to Amy Harfeld, a policy consultant for the Children’s Advocacy Institute in San Diego.

“The point is, we need to stop putting kids’ Social Security numbers on their ID cards and passing them around like candy,” Harfeld said at the forum, which was hosted by the Federal Trade Commission.

Last year, more than 18,000 child identity theft complaints were reported to the commission, compared with about 6,500 cases in 2003. The increase comes as the recession has left many Americans with greater need for clean sources of credit, making the temptation to hijack a child’s pristine record even greater.

But the real figure is probably much higher, experts say, because the crime often goes undetected until victims turn 18 and find their damaged credit is preventing them from acquiring student loans, jobs or apartments. ID Analytics estimates more than 140,000 children are victims of identity theft each year, based on a one-year study of those enrolled in the firm’s identity protection service.

The profile of a child identity thief takes different forms. In some cases, family members who have ruined their own credit steal the identities of their children. In others, organized criminals target institutions such as foster homes where children’s identities are lying around virtually unguarded.

Last February, Felix Nkansah, 28, of New York, was sentenced to six years in prison for participating in an identity theft ring that stole records of children in foster homes to file fraudulent tax returns.
Experts say such cases highlight the porous security of children’s data in foster care, where personnel are focused on protecting children, but not their identities.

“Record management at foster agencies is a joke,” Dan Hatcher, a professor at University of Baltimore Law School who does research on poverty issues, said at the forum. “Caseworkers either are not looking for these issues, or when they spot it, they don’t know what to do.”

In a study of about 2,100 foster children in Los Angeles County, more than 100 children (about 5 percent) had accounts opened in their names, with an average $3,600 in debt. One foster child was found to have a $217,000 home loan, according to the study, which was released in August by the California Office of Privacy Protection, a state agency.

Thieves who steal the identities of foster children are targeting a group that already faces financial obstacles. Less than 3 percent earn four-year college degrees after leaving the foster care system. By age 24, less than half find full-time jobs, and nearly 40 percent have been homeless, according to a study by the Children’s Advocacy Institute and First Star, a nonprofit that works with victims of child abuse and neglect.”

REFORM Puzzle Piece

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