Protecting Your Children from Identity Theft

Identity theft can be a major hassle to deal with. When an unscrupulous person takes your personal information and uses it to open new credit cards, bank accounts, loans, or other financial services and bails on the debts they accrue, it can ruin your credit.

However, adults aren’t the only targets of identity theft. Minors can also be targeted for identity theft scams that leave their credit scores in tatters before they even ever think about opening a bank account.

But wait, can a minor even have a credit score? How are children targeted for identity theft? What can you do to protect your children?

Let’s take a look at how you can protect them from morally void scam artists.

Can a Minor Have a Credit Score?

The answer to this question is: “not typically.” Most minors don’t have a credit score or credit history since they cannot open credit cards or take out loans in their name. After all, they’re minors and are thus unable to enter into binding legal agreements with banks or other lenders.

A child would be considered a minor if they haven’t yet reached the age of majority for your province, which is 18 in Alberta, Manitoba, Ontario, Prince Edward Island, Quebec, and Saskatchewan and 19 in British Columbia, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, and Yukon. 

Even if they aren’t able to open credit cards or loans in their own name just yet, it’s important to teach your kids (especially teens) about credit—what it is, how to build it, and how it can help them in the future.

A minor could possess a credit score or history if:

• They’ve been the victim of identity theft and the fraudster opened credit cards or applied for loans using their name.
• They’ve tried to apply for credit cards or financial services themselves.
• Their data has been compromised in a data breach and resold to other organizations (even without fraudulent transaction attempts).

How Children Are Targeted for Identity Theft

Since children don’t have credit scores or history, would they even be a target for fraudsters that want to make a quick buck or access financial services they wouldn’t otherwise qualify for? Unfortunately, yes, they do make good targets for financial fraudsters. As noted by Equifax, a child’s lack of credit history “means that they present a blank slate for fraudsters who can apply for credit and take out loans in their name.”

But, how do fraudsters get all of the information they need to target your children for identity theft? There are a few things fraudsters might do to trick you, your children, or the various businesses you trust with your child’s information into surrendering it to them so they can commit their crimes.

For example, an identity thief might:

• Use Phishing Techniques. By posing as an authority figure or as a representative of a financial institution, a fraudster can coax sensitive information out of the unsuspecting. They might try to call you to tell you about “suspicious activity on your or your child’s account” and ask you for details like their name, date of birth, account number, etc. to “confirm” it while they “work to resolve the situation.”
• Buy Stolen Information Online. There’s a hidden version of the internet called the “Dark Web,” where cybercriminals buy and sell stolen data and other services using special anonymous web browsers like The Onion Router (TOR) to hide their activity from authorities. Personal information collected during data breaches of hospitals, businesses, and even government entities can be put up for auction on these sites. Crooks can buy this information and use it to commit identity theft against you, or even your child.
• Steal Data from Businesses and Government Entities Directly. Companies might have more sensitive information about you than you might initially think. Fraudsters may try to steal this data directly from them to get the information they need to commit identity theft.

These are just a few of the ways that a criminal might get ahold of your child’s identity so they can leverage it for fraud. Protecting minors’ credit scores is something that most parents wouldn’t even think about, but it could help you preserve your child’s financial future.

So, you return home one day after work and find a credit card offer in the mail. It’s a typical enough scenario. However, when you read it, it isn’t addressed to “current resident” or your name, it’s in your underage child’s name. Somehow, your child now has a credit history that is generating credit card and loan offers.

What do you do? One option is to file for Social Insurance Number (SIN) alerts for your child with the major credit bureaus. What does this do and how do you do it?

What Is SIN Protection?

SIN protection is a request you can put in with the major credit bureaus to send an alert to the lending agency when someone tries to use your (or your child’s) Social Insurance Number for any reason. This can help to protect your child from identity theft by making the bank or credit card company aware that the request being made needs more scrutiny and due diligence—making it harder for criminals to steal identities unnoticed.

How to File for SIN Protection

To file for SIN alerts, you’re going to have to go through a process with each of the major credit bureaus. In Canada, that’s Equifax and TransUnion. Both entities have their own processes and forms to fill out to apply for these alerts. 

Equifax Process for SIN Protection 

• Reach out to their call centre 1-800-871-3250.
• You will require 2 forms of ID of the parent/guardian and a photocopy of a Power of Attorney.
• They will email confirmation of the alert.
• There’s no fee.
• If someone tries to apply for credit using that SIN number, they will see that there is an alert and will know that they need to take additional steps for their due diligence.

TransUnion Process for SIN Protection/Fraud Alerts

• Mail a written request along with photocopies of 2 ids for the parent and a copy of the documents proving the child’s SIN.
• Mailing address:
• Transunion Canada
  PO Box 338, LCD1, Hamilton, ON, L8L7W2
• You will be notified/alerted of confirmed activity at your mailing address anytime within 30 days.
• The warning will stay active on file for 1 year and it will alert the creditors to take reasonable steps to confirm your (or your child’s) identity if they receive any application for credit.

It’s important to note that the two credit bureaus don’t share information with each other. So, you will need to do this process for each credit bureau separately. It’s not enough to file a request with just one credit bureau. 

Before contacting the credit bureaus, it may help to gather documentation proving your relationship to your child, such as your and your child’s government-issued IDs, birth certificate, power of attorney, court orders, or foster care certification. 

Other Ways to Protect Your Child from Identity Theft

A SIN protection alert is just one way to help protect your child from fraud and identity theft. There are numerous other things you can do to protect your children from identity theft or to spot possible identity theft early so you can take corrective action.

Some other things you can do include:

1. Never Sharing Your Child’s Social Insurance Number with Anyone

As noted by the Government of Canada, your Social Insurance Number (SIN) “is confidential. Do not use it as identification or provide it for job applications, rental applications, etc.” For example, while an employer might need your SIN after hiring you, they should not be requesting it during the job application process (it isn’t illegal for them to ask, but they don’t need it until they hire you).

The same goes for your child’s SIN. You should never provide their SIN unless it’s for a specific purpose—such as filing for government programs and benefits. You can check with the Social Insurance Number Code of Practice webpage to see which government programs are allowed to use your SIN.

2. Monitor Your Children’s Online Activity

Do you know what websites your kids are visiting and whether they’re sharing sensitive information with strangers online? Are they spending $1,000 on your credit card in online games with loot boxes or other microtransactions? Are strangers asking them questions about where they live and other things that can be used to commit fraud (or worse)?

While it’s important to give your kids some privacy, it’s equally important to set boundaries that protect them from malicious online actors. Consider taking steps like restricting which websites their computer’s web browser can visit to a preapproved list of safe sites, not linking your credit card to their online gaming profiles, and reviewing safe web browsing and computer use best practices with them.

3. Teach Your Kids about Money and Credit

Helping your kids learn about money—its value, how it’s earned, and how to protect it—is an important step in protecting their financial future. For example, you could teach them about credit building and how having a credit card helps them build a reputation with banks and lenders while also being a major risk and responsibility that can impact their lives for better or worse.

Other things you might want to talk to them about include:

• How to create a monthly budget
• Why it’s important to pay credit cards off each month
• Ways to limit their online spending
• Tools they can use to help them manage their money
• How to identify scams and avoid them

Need help with debt, want advice about dealing with scams, or want to know more about how to control your finances so you can help your children? Reach out to Credit Canada for assistance!