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Real problem or not? That was the question we faced after we heard U.S. Rep. James Langevin (D-RI) speaking on the House floor about a proposal intended to protect foster children from identity theft.
"I, along with many others, was absolutely outraged to find that foster children are disproportionately victims of identity theft since their personal information passes through so many hands," Langevin said during a speech posted on YouTube on Sept. 21.
The bill, which has since become law and was the focus of a celebratory news conference Oct. 11, requires social service agencies to run a credit check on foster youth just before they become old enough to leave the system. The goal is to allow them to clear up any problems so they can begin their adult life free of identity problems such as fraudulent loans or credit card debt they know nothing about. The law also requires that they receive help in clearing up any credit problems.
But are children in state custody really more likely to be victimized?
The news release issued by Langevin's office linked to a report by the Children's Advocacy Institute at the University of San Diego School of Law, which bills itself as "an academic, research, and advocacy law firm." The 44-page report, called "The Fleecing of Foster Children: How We Confiscate Their Assets and Undermine Their Financial Future," asserts in at least five places that identity theft is common, or a growing problem, or disproportionately affects foster children.
Then the report says, on the next-to-the-last page of the narrative: "Currently, there is [sic] no available data on how many children have been affected by identity theft."
If there are no data, how do you know if foster children are disproportionately affected?
Instead of offering real evidence, the report includes two footnotes citing one article in Newsweek magazine. It quotes the Identity Theft Resource Center in San Diego as saying that half of the 84,000 children in California's foster care system may have been victimized.
Newsweek also reported that the problem got so bad in California that the state passed a law in 2006 mandating credit checks for teens in its foster care system.
We called Langevin's office seeking data. We were sent links to other articles, some congressional testimony, accounts of individual cases of identity theft. All asserted that it was a big problem but none offered any reliable numbers. Many cited the Newsweek article as a source.
When we called the Identity Theft Resource Center to ask how they know that half the foster children in California have been victimized, program director Karen Barney said the organization wishes the oft-cited article would just go away because the number is simply wrong.
How does she know?
As part of its effort to implement the 2006 California law, the state's Office of Privacy Protection checked the credit history of 2,110 foster children, tried to clear up any problems, and attempted to estimate how many children had been victims of identity theft. Its report on the effort was released in August 2011.
When the credit reporting agencies were queried, they reported that the Social Security numbers of 17 percent of the children had been used at some point.
But among 12 percent of all the children, the Social Security number wasn't really linked to anything, so it just could have been a clerical error or there's no name associated with it, so it wouldn't be part of the child's credit report and would be unlikely to affect the child's credit rating, according to the California report.
"We can say (the remaining) 5 percent of these kids had credit reports and that alone is of concern, because they shouldn't," said Joanne McNabb, chief of the office.
But even in that 5 percent group, the problem wasn't necessarily identity theft.
For example, three of the largest questionable accounts were for car loans and one was for a $217,000 home loan. But all four turned out to be the result of some type of error, not necessarily a case of identity theft.
"We were able to confirm that 1 percent [of that 5 percent] were errors" that didn't involve identity theft, McNabb said.
That brings the ratio down to roughly 4 percent.
So are foster children disproportionately affected by identity theft, as Langevin said?
To determine that, you would need to know the extent of the problem among all children. We found only two studies that examined that. Both used data collected by Debix, a company that sells identity theft protection services -- a potential source of bias -- and analyzed at Debix' request.
One, released in 2008, tracked data from 500 children. It concluded that 5 percent -- 26 cases in all -- had problems with their credit file. Six appeared to be due to error, with no sign of fraud. That would bring the ratio down to 4 percent, the same as in the California study of foster children.
The other study of children was done by Carnegie Mellon University's CyLab, which looks at cybersecurity issues. It concluded that "identity protection scans" of 42,232 Social Security numbers of children showed that 7.8 percent showed evidence of identity theft -- an alarming number.
By that measure, foster children are only half as likely to be victims of identity theft -- not more likely, as Langevin said.
But both studies, even as they throw numbers around, emphasize that their numbers should not be used to estimate child identity theft.
McNabb agreed: "Neither of those is an appropriate sample to draw big conclusions."
Are foster children disproportionately victimized compared with adults?
Most sources put the rate of adult identity theft at about 3.5 percent. That may sound like it's in line with the childhood rate, but that's just over one year. The California study looking at foster children found that 4 percent had been victims of identity theft over their childhood.
Asked about our findings, Langevin’s spokesman, Jonathon Dworkin, said there’s another element to consider. Foster children, he said, are disproportionately victimized because, without family support, they may have more trouble clearing up their credit histories if they've been victims of identity theft.
Nonetheless, we think most people would interpret the context of Langevin's statement as meaning that identity thieves are more likely to victimize foster children.
Clearly identity theft is a big problem that often isn't recognized among children. Requiring the state to clear a foster child's credit history before he or she graduates from state custody seems like a good policy.
Representative Langevin said, "Foster children are disproportionately victims of identity theft."
The concept is apparently widely believed and asserted among child advocates.
But no study has directly compared identity theft rates between foster children and other children.
The California study is the only one to look at identity theft among foster children and it found a rate of roughly 4 percent.
Of the two studies we found that looked at overall childhood rates, one showed a rate of identity theft that was similar to foster children. The second found a rate that was higher than the rate seen in the study of foster children.
When Langevin asserts that foster children are disproportionately victims, he's making a claim based on evidence that is either scant, unreliable, or contradictory.
We rate the claim as False.
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YouTube.com, "Langevin Foster Care Legislation Passes House," Sept. 21, 2011, viewed Oct. 3, 2011.
Langevin.House.gov, "House Passes Langevin Legislation to Address Foster Youth ID Theft," Sept. 21, 2011, accessed Oct. 3, 2011
CAIChildLaw.org, "The Fleecing of Foster Children: How We Confiscate Their Assets and Undermine Their Financial Security," March 16, 2011, accessed Oct. 3, 2011
TheDailyBeast.com, "Sabotaged By the System," Feb. 6, 2009, accessed Oct. 3, 2011
Interview, Karen Barney, program director, Identity Theft Resource Center, Oct. 18, 2011
Privacy.CA.gov, "A Better Start: Clearing Up Creditor Records for California Foster Children," California Office of Privacy Protection, August 2011, accessed Oct. 13, 2011
Interview, Joanne McNab, chief, California Office of Privacy Protection, Oct. 17, 2011
BJS.OJP.USDOJ.gov, "Victims of Identity Theft, 2008," Bureau of Justice Statistics, December 2010, accessed Oct. 13, 2011
JavelinStrategy.com, "Recent Javelin Study Shows Children Are At Risk for Identity Theft," Javelin Strategy and Research, Oct. 28, 2008, accessed Oct. 13, 2011.
Debix.com, "Child Identity Theft Study," October 2008, accessed Oct. 13, 2011
Cylab.CMU.edu, "Child Identity Theft: New Evidence Indicates Identity Thieves Are Targeting Children for Unused Social Security Numbers," 2011, accessed Oct. 14, 2011
Privacy.CA.gov, "Identity Theft First Aid," California Office of Privacy Protection, accessed Oct. 13, 2011
Interview, Matt Cullina, chief executive officer, Identity Theft 911, Oct. 19, 2011
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