A Troublesome Number

Stealing a person’s identity is the fastest-growing financial crime, and the worries of law enforcement agencies and legislators are increasing at a similar pace. Congress, in an attempt to curb the rash of identity thefts, is considering legislation to stop indiscriminate use of Social Security numbers, the starting point for most identity thieves. The legislation provides greater protection than a similar California bill (SB 1767), introduced by state Sen. Debra Bowen (D-Marina del Rey).

Assuming someone else’s identity to obtain credit cards, borrow money, take over bank accounts or go on a buying spree is not new. But the widespread availability of personal information on the Internet and the peddling of consumer information by marketers and even government agencies have made it much easier. The San Diego-based Privacy Rights Clearinghouse estimates there were more than 500,000 identity thefts last year. In most cases, the thief started by obtaining the victim’s name and Social Security number from private or government sources.

An individual’s liability for fraudulent debt is limited, but the cost of stolen identity is considerable. Aside from the ordeal of losing personal security, the victim of identity theft spends on average 175 hours and $800 to resolve the problem. The limited data that are available show the typical victim of identity theft does not find out about the crime until a year or so later, when credit is denied or debt collectors start knocking on the door.

The federal bill (HR 4857), co-sponsored in the House by Rep. Robert T. Matsui (D-Sacramento), is aimed at preventing both government agencies and the private sector from using Social Security numbers for identification purposes. The numbers, when introduced in 1935, were issued only to keep track of Americans’ earnings. Today, they have become the universal ID numbers in the United States, appearing on driver’s licenses in many states and in military documents and other identifying information used by banks, insurance companies and colleges, among other institutions.

The congressional measure would prohibit federal, state and local governments, as well as private companies, from collecting Social Security numbers and displaying them on official or commercial documents. It would also prohibit their sale. It is much more comprehensive than Bowen’s state measure, which would only prohibit the display of Social Security numbers on public documents and mailings.

The federal legislation is not the answer to all the privacy problems that consumers are facing today. But it offers an effective starting point against identity theft.