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Guarding against social security fraud

On Behalf of | Dec 30, 2022 | White Collar Crimes |

Financial crimes don’t just hit a handful of people. Criminal acts that involve unlawfully collecting someone else’s benefits impact all Michigan residents. They create tax gaps that impact services and government programs, and such fraud makes it more difficult for the average person to obtain much-needed support at retirement or if they become disabled.

So, how can such fraud be avoided, and how can individuals protect their social security numbers from fraud and exploitation?

The problem of social security fraud

Unlike some other white collar crimes, social security fraud more directly impacts the average person. There have been more than 450 million social security numbers issued since the program’s inception, with some 5 million new ones assigned each year.

The number of times and environments in which people must use or reveal their SS number makes fraud, identity theft, and similar crimes a widespread, national problem. In 2022 alone, the government received nearly 18,000 claims of social security fraud. It’s estimated that such crimes cost taxpayers about $46 million each year.

Social security fraud in practice

Knowing what social security fraud looks like and how it works makes it easier to guard against such crimes.

One common type of fraud is using someone’s social security number to obtain money, either in the form of bank loans, credit cards, or services. They can even use this vital identification number to receive medical services.

Of course, most of this money is never paid back, leaving the lawful taxpayer with bad credit, debt, and possible criminal charges if they can’t prove that their identity has been stolen.

Another form of SS fraud is collecting someone else’s benefits. This can manifest as a caretaker cashing the social security check of a client and keeping the money or accessing a deceased relative’s benefits illegally. Using a child’s social security number, whether it is one’s own child or not, is also illegal.

Some groups of criminal sell social security numbers and fake IDs on the black market. These materials are then used by other criminals for financial gain.

Even the act of not reporting such activities could be considered a criminal act.

How to avoid becoming a victim of SS-related identity theft

The first line of defense is keeping the social security number private. Never use any part of it as a PIN number or password, and don’t carry the card in a wallet or purse.

Shred or otherwise destroy any personal or business papers that contain social security numbers. Never give someone access to the SS card or number. Use a service to monitor the internet and credit reporting bureaus for illicit use.

These measures won’t prevent theft or fraud altogether, but they can make victimhood less likely.