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Hijacking your Social Security number

Imagine giving a stranger all the particulars of your life: your bank account numbers, medical records, work history and credit information. Not happening, right?

But odds are, you regularly give out the one key that allows strangers complete access to all the information above.

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That is your Social Security number. It's what identifies you as being you. No other series of numbers can do what a Social Security number can, and in the case of identity theft or fraud, that's not good.

The history of Social Security numbers
Social Security numbers were first issued in 1936 by the Social Service Board as part of the new Social Security laws. The nine-digit number was supposed to be used exclusively by the federal government to track working individuals for taxation purposes and to track Social Security benefits.

However, the Social Security number has become the most frequently used record-keeping number in the United States. Now, Social Security numbers are used as student IDs, patient identifiers and authenticators to set up bank accounts and obtain loans.

Ironically, during the first few decades that Social Security cards were issued, they contained the phrase, "Not to be used for identification." However, since no law was passed to prohibit the use of Social Security numbers as identification, institutions, including hospitals and banks, began using the nine-digit number to identify their customers.

The Social Security Administration estimates that approximately 227 million individuals have Social Security numbers. According to the Government Accountability Office, or GAO, Social Security numbers have become the de facto national identifier.

Back in the mid-1970s, amid concerns over the growing amount of personal information that was being traded electronically, Congress passed the Privacy Act of 1974. This law states, "Any Federal, State or Local government agency which requests an individual to disclose his Social Security account number shall inform that individual whether that disclosure is mandatory or voluntary, by what statutory or other authority such number is solicited, and what uses will be made of it."

Gail Hillebrand, senior attorney for Consumers Union, publisher of Consumer Reports, says that over the years the Social Security number has become popular because "it's convenient and it's the same number of digits everywhere for everyone and it stays the same, so it has become everyone's form of identification."

It allows financial institutions to distinguish one John Smith from another.

"Social Security numbers are used way too much for unnecessary reasons like identification on Medicare cards, student ID cards or driver licenses," says Hillebrand.

She says that unless you are applying for a loan where they need to check your credit history or a potential employer needs your Social Security number for tax purposes, there is no reason that businesses could not use a different identifier.

"Both government and businesses need to distinguish between convenience and importance. There needs to be a standard of disconnecting ID function from credit function," says Hillebrand.

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