Parents have a new item to add to their financial to-do list: check their child’s credit history.
A new federal law going into effect in September will make it easier for families to combat the growing problem of identity fraud of minors, allowing them to make inquiries about credit files in their child’s name and freeze a file at no cost.
Data-security experts say children are increasingly targeted by thieves who steal their Social Security numbers to create fake or “synthetic” identities, then open credit cards, take out loans or apply for public assistance. One credit-reporting company, Experian , EXPGY +1.20% estimates such identity theft will affect one in four children before they become an adult.
The ability to check children’s credit reports is part of a broader banking law that also allowed unlimited, free credit freezes for adults, a response to a massive data breach at Equifax Inc. EFX +0.98% last September.