No, there is no identity theft involved here.
It simply means that you claimed your son as a dependent and, when your son filed his return, he failed to check the boxes indicating that (1) someone else could claim him as a dependent and (2) that someone actually would claim him as a dependent.
He is quite possibly worth more to you as a dependent than he is worth to himself, but that is not always true. You are going to have to look at the details, resolve it at the family level, then whoever is not claiming him will need to file and amended tax return.