[Clips] A Radical Tool To Fight ID Theft

[R.A. Hettinga]

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 Date: Wed, 6 Jul 2005 16:12:29 -0400
 To: Philodox Clips List <clips at philodox.com>
 From: "R.A. Hettinga" <rah at shipwright.com>
 Subject: [Clips] A Radical Tool To Fight ID Theft
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 <http://online.wsj.com/article_print/0,,SB112060885609977982,00.html>

 The Wall Street Journal

  July 6, 2005
  MONEY

 A Radical Tool
  To Fight ID Theft
 U.S. Is Allowing Some Fraud Victims
  To Obtain New Social Security Numbers

 By CHRISTOPHER CONKEY
 Staff Reporter of THE WALL STREET JOURNAL
 July 6, 2005; Page D1


 As companies roll out a growing variety of tools to combat identity theft,
 some Americans are taking a more radical step: changing their Social
 Security number.

 Traditionally, trading in an old number for a new one is something
 attempted in only the most extreme circumstances. Not only does the Social
 Security Administration demand heavy, documented proof of hardship -- but
 it also means that an individual must then track down every bank, utility,
 credit-card association and government agency that might have the old
 number on file, and persuade them to use the new one.

 Despite the obstacles, in the 11-month period ended in March, roughly 1,000
 people were issued new Social Security numbers for reasons of identity
 theft. While the Social Security Administration started keeping statistics
 on the specific reasons people are issued new numbers only last year,
 consumer advocates expect the number of identity-theft-related requests to
 increase. Last year, the agency received 75,000 allegations of Social
 Security number "misuse," up from just 11,000 in 1998.

 Social Security numbers can be particularly valuable assets in the hands of
 a criminal. With little more than a valid Social Security number and street
 address, a thief can often fraudulently open credit-card accounts or apply
 for loans in someone else's name, severely damaging his credit record.

 People who change their number are hoping not only to cut off their
 assailant, but also to make a fresh start with a clean credit history. Many
 people, though, are frustrated to discover that it doesn't solve their
 problems. In fact, some privacy advocates, government officials and
 consumers who have been through the ordeal warn that it can actually make
 matters worse in some circumstances.

 WRONG NUMBER?

 Some identity-theft victims change their Social Security
 number, but it's a tough task:

 Experts advise against it in most cases, saying it creates new problems,
 extra work and lots of explaining to banks and other institutions.

 Changing numbers isn't easy; considerable evidence is required to persuade
 the government you really need it.

 Even if you get a new number, the old one won't be deleted.

 Getting creditors to use the new number is a significant hassle that can
 take years.

 Identity theft affects nearly 5% of the adult population, according to the
 Federal Trade Commission, costing businesses and individuals a combined $53
 billion annually. Last year, the FTC received 246,000 reports of identity
 theft, nearly triple the number received in 2001.

 Concern is particularly high right now following a spate of recent security
 breaches, which compromised the data records of some 50 million people and
 left many more wondering whether they were affected. The scandals have
 implicated institutions ranging from ChoicePoint Inc., a data broker, to
 Bank of America Corp., to the University of California at Berkeley.

 People who have gotten new Social Security numbers report mixed results.
 Scott Lewis, an X-ray technician from Wintersville, Ohio, changed his
 number a few years ago to untangle his identity from a repeat
 drunken-driving offender who at one point faced murder charges.

 Mr. Lewis first noticed a problem during a job search: Several times he was
 told he was a top candidate for a job, but then would never hear back.
 Finally, "one manager picked up the phone and said, 'You're an unsavory
 character, don't ever call here again,' " Mr. Lewis says. He did a
 background check on himself and discovered that, because of a clerical
 error -- a sheriff's office in Ohio had mistyped the arrested man's Social
 Security number, putting in Scott Lewis's instead -- his identity was being
 confused. At the advice of a prosecutor, he got the SSA to change his
 number. "That was the beginning of a big mistake," he says. "By doing that,
 I now had no credit history, so I can't get credit, and it appears that I'm
 using a fraudulent Social Security number."

 Even people who have had more success offer warnings. Ted Wern, a
 30-year-old corporate attorney in Chicago, changed his number in 2000 after
 someone started impersonating him and racked up large charges on credit
 cards. After years of effort, he persuaded credit-card companies and other
 organizations to start using his new number. Mr. Wern calls his decision "a
 success, but a rarity," and says the move makes more sense for young
 victims who haven't built up lengthy credit records.

 Currently, there are several bills in Congress designed to give individuals
 more control over their personal information. Among them is a proposal from
 Senate Judiciary Chairman Arlen Specter of Pennsylvania and ranking
 Democrat Patrick Leahy of Vermont that would restrict the sale of Social
 Security numbers by companies that buy and sell lists of personal data. The
 proposal would require that consumers be able to obtain copies of files
 that these so-called data brokers have on file for them.

 Changing a Social Security number starts with a trip to one of the Social
 Security Administration's 1,300 branches. Applicants must demonstrate a
 relentless pattern of abuse at the hands of identity thieves, prove that
 they've already taken the usual steps to combat it -- contacting creditors
 and law enforcement, working with credit bureaus and the FTC -- and show
 that "economic or personal hardship" persists.

 Though the SSA doesn't track an acceptance rate, more applications are
 denied than accepted. "It's not just because you were a victim of identity
 theft; you have to meet a higher standard." says Mark Lassiter, an SSA
 spokesman.

 Getting approved for a new number can take months. Only then can the
 process of tracking down creditors and others begin. People who have been
 through it say this is a fitful process, since banks, credit-card issuers,
 auto dealerships and others vary widely in their reaction to such an
 unusual request. In addition, some may work with all three major credit
 bureaus, Equifax Inc., TransUnion LLC, and Experian, a unit of GUS PLC, but
 others may work with only one, creating more snafus. Once a new number is
 in use, consumers must work separately with each of the credit-reporting
 agencies to dispute credit filings using the old number.

 In addition, when a new number is assigned, the SSA doesn't delete the old
 one. Instead, it links the two numbers, because it needs both to compute
 benefits when a person retires. That means when a potential employer,
 landlord or bank looks at the victim's credit report, they see a clean
 record linked to a troubled one. It raises flags, and a victim may have
 even more explaining to do.

 "It looks kind of suspicious," says Fritz Streckewald, an assistant deputy
 commissioner of the SSA. "There's nothing in our system that would
 automatically tell a credit bureau, 'Oh, this is a new number we issued
 because the person was a victim of identity theft.' "

 The agency changes numbers in other rare circumstances, such as when two
 people are mistakenly assigned the same number. Victims of domestic
 violence get consideration, too, as well as individuals who request a new
 number on religious grounds. For example, the SSA would consider changing a
 number if it contained an objectionable series like "666."

 --
 -----------------
 R. A. Hettinga <mailto: rah at ibuc.com>
 The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
 44 Farquhar Street, Boston, MA 02131 USA
 "... however it may deserve respect for its usefulness and antiquity,
 [predicting the end of the world] has not been found agreeable to
 experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'
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-- 
-----------------
R. A. Hettinga <mailto: rah at ibuc.com>
The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

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