Bill introduced to prevent children’s identity theft

WASHINGTON, D.C. – U.S. Sen. Gary Peters (D-MI) and a bipartisan group of senators introduced legislation to help protect children’s identities from “synthetic ID fraud,” a form of identity theft that relies on pairing stolen Social Security Numbers (SSN) with fake names and birth dates.

A recent study found that one in every 10 children had their SSN used by identity thieves to fraudulently open bank accounts or credit card accounts, negatively affecting a child’s credit before they even become adults. U.S. Sens. Tim Scott (R-SC), Claire McCaskill (D-MO) and Bill Cassidy (R-LA) joined Peters in introducing the bill.

“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.”

The Protecting Children From Identity Theft Act will help prevent children’s identity theft by requiring the Social Security Administration (SSA) to accept electronic signatures from consumers so financial institutions can verify customer ID and root out synthetic ID fraud.

Overall, the problem with synthetic ID theft has become more prevalent and costlier over the past few years. A recent study predicted that financial losses attributed to synthetic ID theft have doubled since 2014, and losses have been estimated at nearly $6 billion.

Last month, Peters, Scott, McCaskill and Cassidy sent a letter to SSA’s Acting Commissioner urging the agency accept individuals’ consent electronically in order to help financial institutions better prevent identity theft and fraud.

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