Child ID theft: how to teach your child self-defence against identity theft.

Send a shredder to college. No kidding. No one is too young to be a target for identity thieves.

A survey by the Federal Trade Commission found that nearly 10 million Americans discovered they were identity theft victims last year, and the total cost of this crime was $50 billion.

Children can become victims even while still too young to get credit cards or apply for loans or jobs. Many do not discover they are victims until years or decades later, when applying for student loans or other credit and finding someone else has established, and ruined, credit in their names. Identity thieves may also steal a child's identity to commit other crimes, such as giving another person's identity to police at a traffic stop or during an arrest.

Using identities stolen from wallets (the most fertile source for identity thieves), credit card receipts and the mail, thieves run up credit card bills, take out loans and buy real estate and vehicles, leaving victims to pay off the fraudulent charges and clean up the mess. Victims may not discover the fraud until collection agencies seek payment on delinquent accounts they don't know they have. Reestablishing credit can cost up to thousands of dollars and require hundreds of hours spent making phone calls and writing letters.

Identity thieves divert victims' mail to their own addresses, set up services to authenticate information on credit applications, even add themselves to victims' accounts. They can find out personal information easily by stealing receipts or bills from the trash, faking telemarketing calls to obtain information over the phone, hacking into financial information on computer networks or bribing employees of credit card or rating services for information.

Young people are particularly vulnerable from the beginning. Identity thieves may snatch names from newspaper birth announcements and apply for Social Security cards in children's names. Although they grow up with password-protected Internet access, personal identification numbers (PINs) and other safeguards that their elders never needed to learn about at the same age, young people can also be naive and overly trusting. They may leave checkbooks, credit cards or mail lying around school lockers, college dorm rooms or shared apartments, for example, providing identity thieves easy access to their finances.

The Internet is often blamed for exploding identity theft rates, but it more often begins with a lost or stolen wallet, checkbook or credit card receipt.

To protect children from becoming identity theft victims, parents should teach them to:

* Read bank statements carefully for unauthorized charges.

* Protect all credit card information; for example, safeguard receipts after credit or debit card purchases and do not leave receipts in bags with purchases.

* Shred all financial information before discarding, including all mailed financial offers such as the unsolicited credit card offers that bombard students. If the solicitation includes an actual credit card, cut it into pieces and return it to the sender; otherwise, the credit limit on that unsolicited card may turn up on your child's credit report.

* Put locks on mailboxes and send outgoing mail through secure post office collection boxes. Most campus mailboxes lock securely.

* Order new checks with initials (not full names) and pick up new checks at the bank rather than having them mailed.

* Order merchandise online only from secure Web sites identified with the Verisign or Entrust seals of approval, ordering with a separate card that has a low credit limit.

* Update computer virus protections, never download files sent by strangers and install a firewall program, especially with a DSL or T-1 connection. Most students are savvy about computer security, although many are too trusting with passwords and file sharing.

* Guard Social Security numbers carefully, remembering that many documents (student IDs, health insurance cards, even some state driver's licenses) display them.

* Carry only the single credit card needed for planned purchases; carry a few checks, not a checkbook, and never carry ATM PINs with cards.

* Photocopy all credit and debit cards and securely store copies and phone numbers for canceling stolen cards.

* Check credit reports annually; this typically costs only $9 through Equifax (800-525-6285), Experian (888-397-3742) or TransUnion (800-680-7289).

* Never reveal personal information over the phone, through the mail or over the Internet unless providing the information initiates the request for goods or services.

Parents should also teach their children what to do if they think they are victims, including:

* Report the identity theft to police.

* Send a copy of the police report to banks, credit card companies and other financial services; the sooner the better. The average loss per identity theft crime is $4,800, but the cost per incident is significantly lower when the theft is discovered and reported quickly.

* Contact the credit bureaus and have a fraud alert added to their reports; then potential creditors, such as credit card companies receiving phony applications in your child's name, will notify your child before granting credit in that name.

The Federal Trade Commission has a clearinghouse for identity-theft complaints at (www.consumer.gov/idtheft) and 877-438-4338.

Banks also protect customers against identity theft, in part due to heightened national security policy. Banks now use sophisticated screening for potential fraud, maintain fraud databases and notify victims of unusual transactions. For example, when my son traveled to Europe and paid for airline tickets and hotels with his credit card, KeyBank contacted him to verify these transactions were genuinely his. Banks also train employees in fraud awareness and prevention, as KeyBank does annually.

These measures may seem more important in identity theft cases involving debit cards--your child could be stuck paying bogus charges--than those involving credit cards where the credit card issuer will be stuck.

However, identity theft victimizes all of us--every business and citizen in the United States--through higher interest rates and fees to cover risk. As soon as your children learns to use checking accounts and credit or debit cards, they should also learn how to protect themselves against the thieves who would gladly spend their money by stealing their identities.

Gary Koch is senior vice president and district retail leader for the Alaska District of KeyBank, with responsibility for 18 KeyCenters across the state. He has more than 25 years' experience in banking. His office is located 101 W. Benson Blvd., Anchorage, Alaska 99503, and he can be reached at 564-0215 or Gary_Koch@KeyBank.com.

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