Americans under age 30 experience higher rates of identity theft than those 60 years old and older according to a recently released report by the Federal Trade Commission (FTC) that tracks identity theft in the United States.
The FTC report finds that 6 percent of all identity theft victims are under age 20 while those between 20 and 29 make up 21 percent of identity theft victims.
The rate (6 percent) of the under-20 group, which includes infants and children without financial or other assets, is roughly equivalent to the rate (8 percent) for adults 70 and older, while the rate for young people between 20-29, who are just starting out in life, is almost double that of those between 60 and 69 years of age (21 percent vs. 11 percent). The combined rate for those under 30 years of age is 27 percent, while the combined rate for seniors 60 and older is 19 percent.
Illegal Aliens and Employment-Related Child Identity Theft
So, if identity theft targets young people without financial or other assets, what are the identity thieves after?
The answer is that many identity thieves want children's Social Security numbers in order to obtain jobs. In fact, investigations show that the Social Security numbers of children are highly valued by illegal aliens for employment purposes. And according to the Social Security Actuary, up to 75 percent of illegal aliens use a fraudulently obtained Social Security number.
As early as 2005, the Utah Attorney General's Office reported:
The ongoing investigation has uncovered an alarming new crime spree involving illegal aliens and identities stolen from victims under the age of 12.
As long as children do not use their Social Security numbers, the identity theft goes largely unnoticed and unreported. However, once these children go out on their own, they discover that they are victims of identity theft as they are denied credit, found to be ineligible for means-tested government benefits, and lose out on jobs because other peoples' credit, earnings, and arrest records are attached to their Social Security numbers. When this happens, the identity theft that has been going on for years is reported by 20 to 29-year-olds.
Determining the Number of Victims
Although national statistics are lacking about the number of child identity theft victims, a carefully conducted investigation in Utah provides insight into the magnitude of illegal alien-driven child identity theft.
In 2005, the Utah Attorney General's Office, Utah Workforce Services, and the Social Security Administration compared the Social Security numbers of children under 18 who were receiving public assistance with wages reported to the state.
That investigation found that wages were being credited to the Social Security numbers of 1,800 children under age 13 and to 5,000 children under age 18. Commenting on the investigation, Ronald Ingleby, Resident Agent in Charge for the Social Security Administration, told the Deseret News that over 90 percent of all employment-related, child identity theft cases involved illegal aliens.
According to Utah Workforce Services officials, at the time the investigation was completed, approximately 10 percent of Utah families were on public assistance so extrapolating the findings to all families in Utah resulted in a generally accepted estimate that 18,000 children under 13 and 50,000 children under 18 had their Social Security numbers being used, predominantly by illegal aliens, for employment purposes.
Since 2005, Utah officials have continued to match wage records with the Social Security numbers of children on public assistance and the number of children whose Social Security numbers are being used for employment purposes continues to grow.
Based on interviews with Utah Workforce Services and Attorney General officials in 2012, the number of Utah children impacted by Social Security number identity theft has continued to increase steadily since 2005 and it is likely that as many as 80,000 Utah children are now victims of illegal alien-driven, employment-related identity theft.
Employers and Employment-Related Identity Theft
Employers help drive this employment-related, child identity theft when they refuse to verify the Social Security numbers of people they hire. For example, in 2006, Utah Workforce Services reported that 1,626 employers were paying wages to the Social Security numbers of Utah children under age 12 during the last quarter of 2005. In addition, 606 children under 12 had wages reported on their Social Security numbers during the first quarter of 2006 and one child had 37 people using his or her Social Security number.
E-Verify, an Identity Theft Prevention Tool
In recent years there have been signs that the tide may be turning. The FTC reports that employment-related identity theft fraud accounted for 5.7 percent of all identity fraud in the United States in 2012. This is 50 percent lower than just two years earlier when it stood at 11.2 percent. The sharp decline in employment-related identity theft coincidentally comes at a time when the use of E-Verify is expanding rapidly and when the economy is recovering.
According to congressional testimony of Soraya Correa, Associate Director for the Enterprise Services Directorate of U.S. Citizenship and Immigration Services (USCIS), responsible for overseeing the E-Verify program:
The number of employers registered to use the E-Verify Program has grown rapidly to more than 432,000 as of February 2013 compared to only 24,000 in fiscal year (FY) 2007, with the number of new employer registrations averaging between 1-2,000 per week in FY 2012. More than 50,000 federal contractors are enrolled in E-Verify.
E-Verify is, therefore, a child identity theft protection system because it renders the fraudulently obtained Social Security numbers of children useless for employment purposes. E-Verify requires that the name, date of birth, and Social Security numbers match. Generally, illegal aliens don't have either the name or birth date of the person whose Social Security number they are using. Thus, they are unable to provide the matching name and birth date and will not be cleared for employment by E-Verify.
However, even if illegal aliens have the full name, date of birth, and Social Security number of a child, they cannot use the birth date because it won't match their physical appearance and because employers do not hire infants and children. This makes the child's stolen Social Security number useless to the person using it.
E-Verify also puts an end to Social Security number-only, employment-related identity theft that occurs when a person uses his own name and a Social Security number belonging to another person. Social Security number-only identity theft accounts for up to 98 percent of all employment-related identity theft. Thus, E-Verify puts an end to the vast majority of all employment-related identity theft and it protects not only children but adults as well.
The FTC report shows that border states tend to have the highest levels of employment-related identity theft (Arizona, 19 percent; New Mexico, 15 percent; Texas, 10 percent) followed by states that are considered to be illegal immigrant-friendly (Colorado, 12 percent; Utah, 10 percent; and Nevada, 8 percent).
In Arizona, which has a mandatory E-Verify law, reported employment-related identity theft has been reduced by 40 percent since 2008 — down to 19 percent of all reported identity theft from 33 percent. In Utah, which requires governmental entities and most employers to use E-Verify, the rate of employment-related identity theft has declined by 37 percent — down from 16 percent of total identity theft in 2008 to 10 percent in 2012.
In conclusion, illegal alien, employment-related child identity theft provides a plausible explanation for the unexpectedly high levels of infant, child, and youth identity theft. The greater use of E-Verify will reduce this type of identity theft gradually since young children whose identities have already been compromised may not discover it for 10 or 15 years and as this identity theft is discovered it will be reported. However, once the last of these children reach age 20, the child and youth identity theft rates should drop substantially.