Washington, DC—U.S. Senators Bill Cassidy, M.D. (R-LA), Tim Scott (R-SC), Claire McCaskill (D-MO), and Gary Peters (D-MI) introduced the Protecting Children From Identity Theft Act (S.2498), bipartisan legislation that will help prevent children’s identities from being stolen through a type of theft known as synthetic ID fraud.
The legislation combats this illegal activity by directing the Social Security Administration (SSA) to accept electronic signatures as consumer consent for financial institutions trying to verify customer ID and root out synthetic ID fraud. Research shows one in every 10 children have their Social Security Number used by someone else to fraudulently open financial accounts, and that children’s identities are stolen at a rate of about 50 times more frequently than adults. Their personal information can be used by identity thieves to apply for loans, utility accounts, property accounts, drivers licenses, and vehicle registrations, leaving children and families burdened with debt and flawed credit history.
“Some children have their identities stolen before they can even talk,” said Dr. Cassidy. “This bill protects them and modernizes fraud detection to stop more people from becoming victims.”
“It is simply inconceivable that a criminal would seek to exploit a child’s identity and personal information for their own financial gain, and we must look to utilize all of our resources to stop these crimes from continuing to negatively impact our families,” said Scott. “This upgrade to Social Security Administration procedure is a commonsense and effective way to cut down on synthetic ID fraud and help prevent millions of people from having their identity stolen.”
“Scammers have left no stone unturned in stealing children’s Social Security numbers to open fraudulent credit cards—wrecking kids’ credit scores before they’ve even graduated high school,” said McCaskill, a former Missouri State Auditor. “When it comes to protecting Missourians’ hard-earned savings, and their identities, we need every tool available to stop this theft. This legislation would do just that—by bringing the Social Security Administration into the modern era with better verification steps to protect consumers.”
“Lenders can and should do more to protect Michigan children from identity thieves who ruin their good names and credit by taking out fraudulent loans,” said Peters. “This commonsense, bipartisan bill will give lenders the tools they need to verify identities, stop billions of dollars in losses from fraud, and put Michigan children on the path to a secure financial future.”
Last month, this same group of senators urged the Social Security Administration to accept individuals’ consent electronically in order to help financial institutions better prevent identity theft and fraud. The senators have also asked Senate Banking Committee Chairman Mike Crapo (R-ID) to include this bill in the Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155), which the Senate is considering this week.
Over the past few years, the problem of synthetic ID theft has become costlier and more prevalent. A recent study found financial losses attributed to synthetic ID theft have doubled since 2014, and losses have been estimated at nearly $6 billion.