A bill that is close to becoming law in South Carolina would allow parents to protect their children from potential identity theft by putting a security freeze on the child’s credit history.
The proposed legislation cleared the state House of Representatives on Wednesday and is one vote away in the Senate from going to the governor’s desk.
Normally, a person is able to contact the three credit bureaus and place a credit freeze on their report. That is to prevent a bank or other institution from accessing personal information without the customer’s knowledge, thus alerting the customer that someone may be trying to fraudulently obtain a loan or make a major purchase in their name.
But the bill’s lead sponsor Sen. Katrina Shealy, R-Lexington, said children have no credit history. Under her legislation, a parent could open a credit report in the child’s name, then lock it under a credit freeze until the child comes of age. Guardians would also be allowed to place security freezes on the names of vulnerable adults
“If somebody steals (a child’s) ID, it might go unnoticed for 10, 12, even 18 years because they never buy anything,” she told South Carolina Radio Network. “So we don’t know that somebody stole their ID.”
Shealy said the bill could bring peace of mind to some victims from the 2012 Department of Revenue hacking that compromised over 3.8 million Social Security numbers, including children who were named as dependents. But the senator said she had conceived of the possible law independently of the breach.
“What if somebody stole the Social Security number of their tax report, what would happen?” Shealy said. “They could use the Social Security number for years and nobody would ever notice it.”
The bill first passed the Senate last year, but was delayed in the House over whether or not the credit bureaus could charge a $5 fee to create a child’s credit report. Lawmakers eventually passed the bill without the fee included. Senators need to concur on the House version before it could head to Gov. Nikki Haley, who is expected to approve it.