The latest form of identity theft and on-line scams doesn’t depend on stealing your personal social security number but instead the social security numbers of children. Authorities believe this is a form of identity theft that could be on a larger scale than what they currently know. Thieves target the social security numbers of children long before the numbers are used when the children become of adult age and try to obtain and establish credit.
The social security numbers are sold under different names in order to help those buying them to establish phony credit and rack up huge debt they have no intentions of paying off. Authorities fear this scheme could pose an entirely new threat to the nation’s credit system. It has also been mentioned this could cause another financial collapse if many people are obtaining credit by this kind of fraud. The scheme is usually operated by fly-by-night businesses and therefore making it difficult to know how widespread the fraud could be. The use of these social security numbers happens to be in a legal gray area which makes it tougher for federal investigators to be certain with how to prosecute.
The sellers of these social security numbers belonging to young children refer to the practice as credit profile, credit privacy numbers and credit protection, so they can slither their way around the law without ever referring to social security numbers. Over the last couple of years, millions of Americans have watched their credit scores plummet to below 599, making it difficult to obtain credit cards, home and automobile loans. These schemes use computers and public information in order to locate social security numbers. Then they run the numbers through public data bases to determine which ones are active numbers but have never been used. These numbers are generally ones belonging to children who have no credit history. Their credit is unblemished and free for the taking.
When a social security number is found that fits the criteria, it is then sold for a couple hundred to several thousands of dollars. The individual purchasing the social security number can then build a credit rating in a method referred to as piggybacking which is done by linking to someones credit file other than their own. Many times there is also a promise made by these scam businesses of raising the individuals credit score to 700 to 800 within a matter of six months. When the individual defaults on the payments to the establishments money is owed to, they simply purchase another social security number and start the process over again.
A clean social security number is determined by validating it as an active number and one that is not on file with any of the major credit reporting bureaus such as Experian, Equifax and Transunion. When a child reaches adult age and begins to use their social security number in order to obtain and to establish credit, the tremendous trouble of cleaning up the mess from identity theft begins. What a terrible way this is for a young person to start their adult life.