A gang in Toronto manufactured false social insurance number (SIN) cards. They then used the cards to cash forged cheques and to defraud a number of financial institutions of at least $5.1 million.
A Vancouver impostor used forged birth certificates to obtain 26 SINs. He then set up phony companies to issue false records of employment to the names on the cards, and collected $160,000 in employment insurance benefits before being arrested.
In Toronto, an illegal immigrant purchased a set of identity papers, including the SIN card, from a theft ring. He then worked for a legitimate employer, obtained credit and committed a crime. A person whose wallet had been stolen the year before received bills totaling over $28,000, his credit rating was ruined and he was arrested and detained overnight before it was determined an impostor had stolen his identity.
IDENTITY FRAUD AND THE SIN
Identity fraud including stolen, lost and borrowed SINs has a high cost for businesses, individuals and governments across Canada. Identity fraud is the fastest growing global crime.
By obtaining a new identity, impersonators can obtain social benefits to which they are not entitled, defraud credit, financial and educational institutions, remain and work illegally in Canada or take advantage of Canadian social services such as health care, hide a criminal record, and avoid responsibilities such as unpaid debts and family support.
For this reason a fraudulent SIN card is an important document for anyone who is attempting to create a new identity.
WHAT IS THE GOVERNMENT DOING TO PREVENT SIN FRAUD?
Human Resources Development Canada, the federal department responsible for the social insurance number program, is implementing a number of initiatives to prevent misuse of the social insurance number and assist victims of identity fraud. The department has undertaken a SIN awareness campaign including a SIN brochure for the general public aimed at raising public awareness of how to properly use and protect the SIN, as well as an employer factsheet on the SIN. New prevention and detection programs have been implemented and new tools have been developed to assist victims of identity fraud.
HRDC has set up a committee to gather knowledge about identity fraud, study patterns and trends in SIN fraud cases, improve programs and improve their staff’s ability to detect fraudulent documents. A SIN investigation unit was established and has been steadily increasing the number of SIN investigations conducted — 7,000 in 2000. HRDC has already taken action to improve the quality and integrity of the Social Insurance Register. The next steps include improving procedures and rules to reduce fraud and unauthorized uses of the SIN.
Consultations with other agencies such as the RCMP and Citizenship and Immigration Canada as well as with officials from other nations are being held to exchange information on the problem.
THE SIN IS NOT AN EMPLOYEE NUMBER
Every person who works in Canada is required to have a SIN. By law persons must provide their SIN to Government of Canada departments or agencies, their employer and those who prepares income tax information on their behalf. This includes some provincial and municipal agencies and all institutions from which they earn interest or income.
The federal government is listening to Canadians. Canadians have indicated they do not want the SIN to become a universal identifier. In the early ’90s the federal government changed their internal policy on the use of the SIN and created a Personal Record Identifier (PRI) to replace the SIN as an employee identifier for their own employees. The federal government recognized the need to reduce the widespread use of the SIN as an employee number due to concerns about abuse of the SIN and its links to an individual’s information.
Although there is no legislation in place to prevent the use of the SIN as an employee number, it is not an authorized use.
The Personal Information Protection and Electronic Documents Act, which came into force in January 2001, will help safeguard personal information including the SIN. This act governs the way personal information is collected, used and disclosed in the course of commercial activities across Canada. This new legislation requires an organization to obtain consent before collecting, using or disclosing SIN as well as other personal information with certain exceptions such as when the information aids in a legal investigation. The law also offers a complaint process where individuals may complain to the Privacy Commissioner if they feel an organization is using their SIN improperly.
EMPLOYER RESPONSIBILITIES
All employers must ask to see the SIN card of all new employees when they are hired, and the employee must show it within three days of the start date of employment.
If a job applicant has a SIN beginning with the number “9” the employer must ask to see the employment authorization issued by Citizenship and Immigration before hiring the person. All terms and conditions on that form, including dates authorized to work, must be met in order to employ that person.
Hiring a person with a “9” SIN who does not have such authorization would constitute “knowingly” hiring someone who does not have the right to work in Canada, an offence under the Canada Immigration Act. Conviction could result in a fine and/or imprisonment.
EMPLOYERS CAN HELP
Employers can make a difference and help prevent fraud by asking to see the SIN card of new employees and by keeping payroll records in the name as it appears on the SIN card. This may also help reduce requests by the Government of Canada to provide payroll clarification.
An employer who suspects that a SIN is being used fraudulently should contact the local HRDC office and speak to an investigator. HRDC will investigate and may prosecute any offence that has been committed under the Employment Insurance Act.
Using somebody else’s number to deceive or defraud, loaning or selling a SIN, and manufacturing a card or a substantially similar card are all offences punishable by a fine, imprisonment, or both.
AUTHORIZED USES OF THE SIN
The SIN was introduced in 1964 as a file identifier for Unemployment Insurance and Canada Pension Plan. Over the years, a number of other federal government programs, such as Income Tax, have been authorized to use the SIN. There are currently 26 legislated or authorized uses of the SIN.
The following is a list of legislated and authorized uses of the SIN.
•Budget Implementation Act 1998 (Canada Education Savings Grants)
•Canada Elections Act
•Canada Labour Standards Regulations (Canada Labour Code)
•Canada Pension Plan Regulations (Canada Pension Plan)
•Canada Student Financial Assistance Act
•Canada Student Loans Regulations (Canada Student Loans Act)
•Canadian Wheat Board Act
•Employment Insurance Act
•Excise Tax Act (Part IX)
•Farm Income Protection Act
•Garnishment Regulations (Family Orders and Agreements Enforcement Assistance Act)
•Gasoline and Aviation Gasoline Excise Tax Application Regulations
•Income Tax Act
•Labour Adjustment Benefits Act
•Old Age Security Regulations (Old Age Security Act)
•Race Track Supervision Regulations (Criminal)
•Tax Rebate Discounting Regulations (Tax Rebate Discounting Act)
•Veterans Allowance Regulations (War Veterans Allowance Act)
•Immigration Adjustment Assistance Program (Citizenship and Immigration Canada)
•Income and Health Care Programs (Veterans Affairs Canada)
•Income Tax Appeals and Adverse Decisions (Revenue Canada)
•Labour Adjustment Review Board (Human Resources Development Canada)
•National Dose Registry for Occupational Exposures to Radiation (Health Canada)
•Rural and Native Housing Program (Canada Mortgage and Housing Corporation)
•Social Assistance and Economic Development Program (Indian Affairs and Northern Development)
For more information on SINs, contact Human Resources Development Canada, Social Insurance Number Inquiries listed in the Government of Canada pages of the telephone directory, or visit the HRDC Web site at www.hrdc-drhc.gc.ca/sin.
Teresa C. Reeve is with Human Resources Development Canada, Investigation & Control. She can be reached at (819) 997-7488 or [email protected].
A Vancouver impostor used forged birth certificates to obtain 26 SINs. He then set up phony companies to issue false records of employment to the names on the cards, and collected $160,000 in employment insurance benefits before being arrested.
In Toronto, an illegal immigrant purchased a set of identity papers, including the SIN card, from a theft ring. He then worked for a legitimate employer, obtained credit and committed a crime. A person whose wallet had been stolen the year before received bills totaling over $28,000, his credit rating was ruined and he was arrested and detained overnight before it was determined an impostor had stolen his identity.
IDENTITY FRAUD AND THE SIN
Identity fraud including stolen, lost and borrowed SINs has a high cost for businesses, individuals and governments across Canada. Identity fraud is the fastest growing global crime.
By obtaining a new identity, impersonators can obtain social benefits to which they are not entitled, defraud credit, financial and educational institutions, remain and work illegally in Canada or take advantage of Canadian social services such as health care, hide a criminal record, and avoid responsibilities such as unpaid debts and family support.
For this reason a fraudulent SIN card is an important document for anyone who is attempting to create a new identity.
WHAT IS THE GOVERNMENT DOING TO PREVENT SIN FRAUD?
Human Resources Development Canada, the federal department responsible for the social insurance number program, is implementing a number of initiatives to prevent misuse of the social insurance number and assist victims of identity fraud. The department has undertaken a SIN awareness campaign including a SIN brochure for the general public aimed at raising public awareness of how to properly use and protect the SIN, as well as an employer factsheet on the SIN. New prevention and detection programs have been implemented and new tools have been developed to assist victims of identity fraud.
HRDC has set up a committee to gather knowledge about identity fraud, study patterns and trends in SIN fraud cases, improve programs and improve their staff’s ability to detect fraudulent documents. A SIN investigation unit was established and has been steadily increasing the number of SIN investigations conducted — 7,000 in 2000. HRDC has already taken action to improve the quality and integrity of the Social Insurance Register. The next steps include improving procedures and rules to reduce fraud and unauthorized uses of the SIN.
Consultations with other agencies such as the RCMP and Citizenship and Immigration Canada as well as with officials from other nations are being held to exchange information on the problem.
THE SIN IS NOT AN EMPLOYEE NUMBER
Every person who works in Canada is required to have a SIN. By law persons must provide their SIN to Government of Canada departments or agencies, their employer and those who prepares income tax information on their behalf. This includes some provincial and municipal agencies and all institutions from which they earn interest or income.
The federal government is listening to Canadians. Canadians have indicated they do not want the SIN to become a universal identifier. In the early ’90s the federal government changed their internal policy on the use of the SIN and created a Personal Record Identifier (PRI) to replace the SIN as an employee identifier for their own employees. The federal government recognized the need to reduce the widespread use of the SIN as an employee number due to concerns about abuse of the SIN and its links to an individual’s information.
Although there is no legislation in place to prevent the use of the SIN as an employee number, it is not an authorized use.
The Personal Information Protection and Electronic Documents Act, which came into force in January 2001, will help safeguard personal information including the SIN. This act governs the way personal information is collected, used and disclosed in the course of commercial activities across Canada. This new legislation requires an organization to obtain consent before collecting, using or disclosing SIN as well as other personal information with certain exceptions such as when the information aids in a legal investigation. The law also offers a complaint process where individuals may complain to the Privacy Commissioner if they feel an organization is using their SIN improperly.
EMPLOYER RESPONSIBILITIES
All employers must ask to see the SIN card of all new employees when they are hired, and the employee must show it within three days of the start date of employment.
If a job applicant has a SIN beginning with the number “9” the employer must ask to see the employment authorization issued by Citizenship and Immigration before hiring the person. All terms and conditions on that form, including dates authorized to work, must be met in order to employ that person.
Hiring a person with a “9” SIN who does not have such authorization would constitute “knowingly” hiring someone who does not have the right to work in Canada, an offence under the Canada Immigration Act. Conviction could result in a fine and/or imprisonment.
EMPLOYERS CAN HELP
Employers can make a difference and help prevent fraud by asking to see the SIN card of new employees and by keeping payroll records in the name as it appears on the SIN card. This may also help reduce requests by the Government of Canada to provide payroll clarification.
An employer who suspects that a SIN is being used fraudulently should contact the local HRDC office and speak to an investigator. HRDC will investigate and may prosecute any offence that has been committed under the Employment Insurance Act.
Using somebody else’s number to deceive or defraud, loaning or selling a SIN, and manufacturing a card or a substantially similar card are all offences punishable by a fine, imprisonment, or both.
AUTHORIZED USES OF THE SIN
The SIN was introduced in 1964 as a file identifier for Unemployment Insurance and Canada Pension Plan. Over the years, a number of other federal government programs, such as Income Tax, have been authorized to use the SIN. There are currently 26 legislated or authorized uses of the SIN.
The following is a list of legislated and authorized uses of the SIN.
•Budget Implementation Act 1998 (Canada Education Savings Grants)
•Canada Elections Act
•Canada Labour Standards Regulations (Canada Labour Code)
•Canada Pension Plan Regulations (Canada Pension Plan)
•Canada Student Financial Assistance Act
•Canada Student Loans Regulations (Canada Student Loans Act)
•Canadian Wheat Board Act
•Employment Insurance Act
•Excise Tax Act (Part IX)
•Farm Income Protection Act
•Garnishment Regulations (Family Orders and Agreements Enforcement Assistance Act)
•Gasoline and Aviation Gasoline Excise Tax Application Regulations
•Income Tax Act
•Labour Adjustment Benefits Act
•Old Age Security Regulations (Old Age Security Act)
•Race Track Supervision Regulations (Criminal)
•Tax Rebate Discounting Regulations (Tax Rebate Discounting Act)
•Veterans Allowance Regulations (War Veterans Allowance Act)
•Immigration Adjustment Assistance Program (Citizenship and Immigration Canada)
•Income and Health Care Programs (Veterans Affairs Canada)
•Income Tax Appeals and Adverse Decisions (Revenue Canada)
•Labour Adjustment Review Board (Human Resources Development Canada)
•National Dose Registry for Occupational Exposures to Radiation (Health Canada)
•Rural and Native Housing Program (Canada Mortgage and Housing Corporation)
•Social Assistance and Economic Development Program (Indian Affairs and Northern Development)
For more information on SINs, contact Human Resources Development Canada, Social Insurance Number Inquiries listed in the Government of Canada pages of the telephone directory, or visit the HRDC Web site at www.hrdc-drhc.gc.ca/sin.
Teresa C. Reeve is with Human Resources Development Canada, Investigation & Control. She can be reached at (819) 997-7488 or [email protected].
