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Is an adopted child more vulnerable to identity theft? Laura interviews Leslie Tayne from Tayne Law Group and the new author of Life and Debt about the unique challenges adopted children face, and how they can be protected from credit fraud.
The Social Security Number: where everything financial begins.
Adopted children are more likely to have their Social Security number exposed to a larger number of people, especially if they’ve been in the foster care system, had a long stay in the hospital, or were taken care of by family members. The first step to prevent fraud with adopted children is to change a child’s social security number. This is a quick and easy process that only requires:
- Adoption decree
- Birth certificate
- Previous Social Security card
How can you protect an older adopted child with potential credit problems?
Leslie urges all parents to run a credit history on their adopted children with all three credit bureaus as a beginning protective measure. She also warns that people who steal Social Security Numbers know that you’ll be more vigilant about fraud in the beginning, so it is important to continue to monitor your adopted child’s credit.
Can a credit freeze solve the problem of fraud?
A credit freeze can compromise a child’s ability to receive credit like student loans. If a child becomes an authorized user on one of your accounts, your linked accounts can be negatively impacted by their credit freeze, and vice versa. Leslie cautions against a credit freeze as a definite solution to fraud. She advocates for proactively protecting your information.
Preventing credit card fraud after your child turns 18
Because a parent is not allowed to see their child’s credit information once they become a legal adult, it is important for a parent to have a Power of Attorney and authorization before that date. With firsthand experience, Leslie shares that teenagers simply don’t have the brain capacity to understand what you’re doing to help their credit. Teenagers haven’t figure things out and they just don’t care yet.
What can you do if your child already has a damaged credit history?
First, inform the creditors about the fraud. Then file a police report about fraudulent activity. Often debtors do not want to file a claim if the theft was committed by a family member. If this is the case for you, you’ll have to settle or pay the debt. Leslie shares some bankruptcy alternatives for those who would like to avoid filing criminal charges.
What other financial concerns should adoptive parents be concerned about?
Leslie cautions that international adoptions are not exempt from these kind of problems. She also discusses some of the potential complications about custodial bank accounts if you are having credit problems of your own.
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