DebtFreeGuru.com's - Tip of the Week - Monday, August 23, 2004
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Who
Should Attend
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Attend
A Workshop
Safeguard
your Social Security Number
Protect
yourself from identity theft by keeping a tight rein on your Social
Security number. Only a few organizations have the right to demand it.
Here's how to fend off the rest. - By Bankrate.com as seen on MSN.Com
"I think it's spooky. Everybody has that one number, and
everything about you is tied to it," worries Jim Edwards, program
director at WJNO in
"Put it in a computer and poof -- here's your bank account, your
phone number, where you work."
The key to all that private information? Your Social Security number.
Edwards was way ahead of most people. Back in the early '80s, he refused
to give his Social Security number when he enrolled at
Today, schools, phone companies, utilities, health clubs, insurance
companies, video stores -- just about everybody wants your Social Security
number. Some of the more prevalent uses are to get your credit rating and
determine whether you pay your bills, and to keep track of you through
name and address changes.
But companies also use your Social Security number to develop marketing
lists, which they can sell to other companies. A list with the numbers is
more valuable than one without.
Why should you care who sees your Social Security number? The more people
who see it, the more susceptible you are to identity theft, where you are
victimized by someone fraudulently using your name and credit report to
steal money.
Identity theft costs American businesses billions each year, costs that
are eventually passed on to all consumers. The toll on victims is heavy,
too. The California Public Interest Research Group estimates that, on
average, an identity theft victim will spend 175 hours and $800 trying to
clear their record of fraudulent charges.
"I've seen accounts opened with wrong names and different addresses.
As long as there's a SSN, that's all some of them care about," says
Linda Foley of the
Who has the right to ask for your digits?
While any business can ask for your Social Security number, there are very
few entities that can actually demand it -- motor vehicle departments, tax
departments and welfare departments, for example. Also, SSNs are required
for transactions involving taxes, so that means banks, brokerages,
employers, and the like also have a legitimate need for your SSN.
Most other businesses have no legal right to demand your number.
"There is no law prohibiting a business from asking for your Social
Security number, but people don't know they can say no," says Carolyn
Cheezum of the Social Security Administration.
"We recommend that you ask if they'll accept an alternative piece of
identification. If they don't, flat-out refuse to do business with them.
Bear in mind that there's a possibility they'll refuse to provide whatever
product or service you're seeking."
Edwards, for example, won't give his Social Security number to his
doctor's office.
"When you go to the doctor's office and fill out the medical
information, they ask for the SSN. I leave it blank. Nothing happens. I'm
not reporting income from them."
In fact, chances are good that many companies that routinely ask for
Social Security numbers will do business with you even if they can't have
your number.
"We ask for a Social Security number to open an account, but it's not
required," says Michael Lowndes of the Long Island Power Authority.
"The Social Security number is just part of the customer's record. A
common problem with utility accounts is people open an account, default
and reopen another account using the same Social. We can use that to
discover the problem."
Kimberly Brown at Bell South headquarters in
"We ask them to fill out a questionnaire to determine their payment
history. We don't do a credit check; we depend on them being honest. The
questionnaire determines the Bell South rating for them, and then that
determines whether they'll have to pay a deposit to establish
service."
Your cat is sick? Give us your Social Security number
Linda Foley of the
"I said why? Will it be my cat's ID number? They said no, but if you
give us a check we want a driver's license and a SSN in case the check
bounces. I said I'd pay by credit card. They said it's our policy to get
the number.
"I said if I give you a credit card and refuse to give you my Social
Security number, you'd let my cat die right now? They looked at me and the
cat and said, 'Give us the card; we'll take care of it.' I was upset about
the cat, but I was frustrated by the way I was being treated. It was
unnecessary."
Social Security numbers and identity theft
Social Security numbers exist for the purpose of tracking earnings and
paying benefits, Cheezum says. Although President Franklin Roosevelt
signed an order requiring federal agencies to use SSNs for record-keeping
systems, they were never meant to be used by businesses as an identifier,
but have taken on that role because everyone has one.
But the snowballing problem of identity theft is spurring some governments
to limit the use of SSNs.
-
Publicly posting Social Security numbers or requiring them for access to products or services.
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Printing of Social Security numbers on cards required for accessing products or services
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Requiring an individual to use his or her Social Security number to access a Web site unless a password is also required to access the site
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Printing an individual's SSN on any materials that are mailed to the individual.
The
state of
Foley says she hopes other states will follow suit and be even more
restrictive so that SSNs will eventually be used only for a few selective
purposes.
But, Foley says, until that happens, the first defense against the
fraudulent use of Social Security numbers are the companies that issue
credit.
"Are they verifying that the person applying for credit is the true
consumer? Are they looking carefully for red flags that might alert them
to possible fraudulent use? If a credit application has a last name
spelled incorrectly or an address different from the credit record, that
should provoke someone into calling the consumer."
Some privacy rights proponents say Social Security numbers shouldn't be
used for obtaining credit. Does that mean a second number would have to be
issued for people seeking credit? Would that be any better than the
current system?
More protections in
Perhaps
In addition to limiting the use of Social Security numbers, the law allows
a consumer to place a "security freeze" on his credit report.
The freeze prohibits consumer-credit-reporting agencies from releasing the
consumer's credit report or any information from it without express
authorization from the consumer.
Time will tell if that provision works better than the more common
"alerts" that many people put on their credit reports. With an
"alert" a consumer is supposed to be notified that someone is
attempting to obtain credit in his or her name. But stories abound of
breakdowns in the system.
If someone uses your Social Security number to obtain credit and doesn't
pay the bills, you'll discover the fraud as soon as the bill collectors
come calling. But sometimes an identity thief actually pays the bills and,
in those instances, it could be a long time before you discover the fraud.
The best way to find out if someone is fraudulently using your Social
Security number is to request copies of your credit reports at least once
a year. There are three main credit-reporting agencies. It's a good idea
to get a copy of your report from each agency so you can check for
discrepancies. You can order your credit report from: TransUnion, Equifax
and Experian.
DebtFreeGuru.com - Tip of the Week - Monday, August 23, 2004
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