Franzen Introduces Bill to Protect Minors from Credit Fraud

ST, PAUL, Minn. – Senator Melisa Franzen, DFL-Edina, introduced legislation this week to protect minors from the growing problem of credit fraud. Minnesota children’s personal identifying information has been stolen after national and statewide data breaches. This bill would allow parents or guardians to freeze their children’s credit reports to protect them from additional fraud. Sen. Franzen introduced this bill after hearing from a constituent whose child was the victim of credit fraud.

“We need stronger protections for children who are victims of identity theft,” said Franzen. “Too many of our children have been robbed of their chance to establish their own credit, which we all know becomes increasingly important as they grow to adulthood. Allowing parents and guardians to request credit report freezes will stop a perpetrator of identity theft from continuing to use children’s personal information to open their own lines of credit and ruin minors’ credit history before they ever have a chance to manage their own finances.”

The Bank Secrecy Act as amended by the USA PATRIOT Act requires financial institutions to establish Customer Identification Programs (CIP) and collect specific data elements from each customer, including name, address, date of birth, and social security number. The financial institution is also required to perform verification of those elements, for which they frequently rely on third-party vendors with databases of publicly available information like utility bills and property records. Minors are generally not included in these databases, as they have limited publicly available information. This makes it difficult for financial institutions to know that a perpetrator of identity theft is using a minor’s information as their own.

More than 20 states already allow parents or guardians to freeze a minor’s credit report.

Senator Franzen
Melisa Franzen represents District 49 in the southwest Twin Cities metropolitan area.

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