Imagine someone applying for – and receiving – your Social Security benefits before you do. Think it can’t happen? Think again. Welcome to the disturbing world of identity theft in 2018.
Due to massive data breaches, such as last year’s Experian breach, where about one-half of all U.S. citizens’ personal information was stolen, global identity thieves now may have your data to facilitate crimes far beyond applying for fraudulent credit cards.
Typical proactive antifraud steps will not help because these crimes do not require verification through a credit bureau. As a result, your credit freeze is meaningless in certain types of identity frauds. Social Security fraud is one of them.
Social Security fraud occurs when a thief, in possession of your personal data (name, address, Social Security number, and date of birth) applies to receive Social Security benefits before you. For example, they may apply to receive your benefits when you turn 62. Just think, you wanted to wait a few years to receive a larger benefit. Surprise!
The notification reads as follows: “You completed an application on the internet for Social Security retirement benefits and we stored the application information in our records. We need further information in order to process your application. Please call our office within 10 days at the number listed below.”
In today’s electronic world, many apply for benefits online as a result of creating an online account. One internal control the Social Security Administration takes is to send a letter to the last known address notifying you that you have created an online account. An identity thief must change your address so that the fraudulent benefits will be mailed to an address to which they have access. The Social Security Administration will also send a change of address letter to the last known address notifying you of the change of address request. If you hadn’t applied for an online account or a change of address, you must act. Do not ignore these letters. Personally, I’m not calling any number on a form if I can attempt to verify the letter in person.
You can always call the Inspector General’s office at 1-800-269-0271. Better yet, if you are like me, visit a local Social Security Administration office and advise them of the fraudulent notifications. After proving to them that you are who you say you are, they can delete these transactions. Remember, the bad people attempting to do this still have all of your personal information, as unsettling as that may be.
What can you do to minimize this from happening? We recommend creating an online Social Security account, even if you have no intention of ever using it. That way a fraudster can’t create one for themselves in an attempt to defraud you of your Social Security retirement benefits.
Questions? For more information, please contact Frank Suponcic at 440-449-6800 or email Frank.
Frank A. Suponcic, CPA, CFE, CFF, is a partner in Skoda Minotti’s Valuation and Litigation Advisory Services Group where he regularly assists clients with fraud assessments, forensic investigations, economic damage claims, commercial disputes, divorce and labor relations. In addition, he frequently represents privately held business, nonprofit entities and individuals in an array of financial statement and income tax preparation and planning matters.