Dangerous Information
The Dollar Stretcher
by Gary Foreman
gary@stretcher.com

Someone told me you weren't supposed to put your social security number on your checks...Can you give me some input on this subject?

Dear Dollar Stretcher,
Someone told me you weren't supposed to put your social security number on
your checks. Also you shouldn't have your number on your driver's license
since that number is used for a lot of private things.  Can you give me
some input on this subject?
Marsha

      Marsha has asked a question that we should all be considering. How
free should I be in releasing my social security number? And, frankly, what
you're about to read isn't going to make you comfortable.
      Originally social security numbers were not to be used for
identification. It even said so on your social security card. But no law
was ever passed to support that.
      Recently, as our society has grown more complex the trend has been to
use your social security number in many more places. They've cropped up on
driver's licenses, mailing labels, student ID's.
      Surprisingly, the Social Security Administration has no legal
authority to keep anyone from asking for your number. Nor can they control
what someone does with it once they get it.
      To further complicate matters, some people want to use social
security numbers to catch bad guys. The 1996 Immigration Reform Act
required states to get a valid social security number before issuing a
driver's license. The goal was to catch illegal immigrants. Some states
used that change to move toward using social security numbers as a license
number.
      Others have proposed requiring the use of your social security number
for other government services. The goal was to catch 'dead beat dads' and
other criminals. An admirable goal, but questionable from a privacy point
of view.
      Currently, there are two problems with the way social security
numbers are being used. The first is that many organizations use your
social security number as a password. Knowing the number gets you access to
the account. Clearly that makes it easy for anyone who knows your number to
pretend to be you.
      The second problem is that many places use your social security as an
ID number. Banks, hospitals, brokers and others all find it convenient.
Names and addresses can change. But, your social security number remains
the same. So that number makes it easy to identify you. But it also means
that your number isn't nearly as private as it once was.
      And that's created an entirely new crime called 'identity theft'.
According to the U.S. Secret Service identity theft crimes cost about $1
billion last year. It's estimated that there are 500,000 new victims yearly.
      Identity thieves will open a new credit account using your name. All
they need is your social security number and date of birth. To keep you
unaware of the crime they'll have the bills sent to their address. You'll
never know about the account. Naturally they won't pay the bills and you'll
be left with the bad credit entries.
      Thieves can also use your social security number to change the
address on an existing account. They'll request an additional card and
begin to make charges but you won't see any statements.
      And it's not just credit cards. Many savings institutions will allow
a caller to transact business in an account if they have the name and
social security number. They can transfer money out of your bank account
without ever setting foot in the bank.
      Pretty scary, huh? And it's not hard to steal your social security
number. It's often listed on billing and investment statements. All it
takes is the theft of one statement from your mailbox. Would you even
notice that it was missing?
      What's interesting is that in most identity theft cases the police
don't consider you to be the victim of a crime. That's because the card
issuer is liable for the fraudulent bills. Unfortunately your reputation
doesn't have a dollar value.
      So how can you protect yourself? The American Association of Retired
Persons suggests that you do not print your social security number on your
checks. They also advise that you not carry your social security card with
you. But that's only the beginning.
      The real question is what happens when you want to do business with
someone and they ask for your number. Private organizations can demand your
number for almost anything. You can refuse to give it to them. But then
they can choose not do business with you.
      For instance, when you move the utility company may ask for your
number before they initiate service to your home. They can do a credit
check without your number. And they will if you request it. But that will
take longer. And you might not be willing to wait to get your  electricity
turned on.
      When someone asks for your social security number find out why they
need it. Expect to provide it when you apply for credit. For anything else,
you might want to consider refusing the request.
      You'll also want to know how they'll use your number once they have
it. Will they access your credit file once and that's it? Remember, the
information that you provide may not remain private. Even 'reputable'
businesses have been known to sell blocks of social security numbers.
      There's no one right answer for all situations. Just a lot of grey
area. But by considering the request you should have a reasonable chance to
come to a good decision.
      Finally, check your credit report often. Anyone misusing your social
security number will leave evidence in your credit file. They're just
counting on you not to notice.
      Check your credit rating at least once a year. There are three main
credit reporting agencies. By law they may charge you up to $8 for your
report unless you have been denied credit due to their report within the
last 60 days.
- Equifax: 800-685-1111
- Experian (formerly TRW): 800-682-7654
- Trans Union: 800-888-4213
      Naturally you don't want to have to pay for the report. Consider it
low cost insurance against the hassle of an identity theft.
      So, should Marsha provide her social security number? Only when she
feels that it's really necessary. And she, like all of us, need to be alert
for unusual activity.
__________

Gary Foreman has worked as a Certified Financial Planner and currently
edits The Dollar Stretcher website www.stretcher.com and newsletters.
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