Tuesday, May 12, 2009

Social Security, A Cause For Social Insecurity

SSN Fraud annually $50B, could be eliminated by e-Smart’s I AM Card, the offer by e-Smart was interrupted. The amount is the same range of Madoff Fraud, the claim against which had been interrupted too.
Who is responsible for the damage to innocent and good citizens, $100B ??


Social security act and purpose:
The primary objective of the social security number (SSN) is to track individuals for tax purposes, but unfortunately it does more than that. SSN has become an identifier for individuals in the United States. It is used on many transactions like purchasing car or house, opening a bank account, applying for a loan, applying for credit card etc.
Understanding the SSN:
The SSN is a nine-digit number that is not randomly generated, but follows a pattern. The first three numbers (area number) refer to the state in which the number was issued. The next two (group numbers) indicate the order in which the SSN was issued in each area. The last four (serial numbers) are randomly generated. Thus a SSN can reveal an individual's relative age and place of origin1.

Identity theft is defined as the process of using someone else’s personal information for your own personal gain. This personal gain may be in terms of employment (illegal immigrant assuming false identity), finance (applying for loan, credit card or opening bank account) etc.
Identity theft has become a major concern in the United States with nearly 10 million American victims losing $48 billion in 2008. The number of victims rose 22% to a record 9.9 million in 2008 from 8.1 million a year earlier, with about one in 23 U.S. adults becoming victims2.

A main cause for identity theft is insecurity in the SSN. When one’s SSN falls into wrong hands, it can be used to get personal information about that person and use it for various crimes.
For example, identity thieves can use someone’s SSN number and credit to apply for more credit in the person’s name. Then, they use the credit cards and do not pay the bills creating a negative impact on the persons credit history. Also, compromised SSN’s are sold at a price and from which a Social Secirty Card can be fabricated. A lot of illegal immigrants buy such fake Social Security Cards to get jobs, open bank accounts etc. to survive in United States.

Following are some facts and figures on Identity Theft:
(Credit: FTC) NOTE: Identity Theft Ranks # 1 on FTC Complaint
Source: http://www.ftc.gov/opa/2009/02/2008cmpts.shtm

Identity Fraud Trends
Source: http://www.idsafety.net/Javelin2009IdentityFraudSurveyPressRelease.pdf

Source: http://vaperforms.virginia.gov/indicators/govtCitizens/consumerProtection.php

In 2007, credit card fraud (23%) was the most common form of reported identity theft followed by phone or utilities fraud (18%), employment fraud (14%) and bank fraud (13%). Other significant categories of identity theft reported by victims were government documents/benefits fraud (11%) and loan fraud (5%).
Source: http://www.idtheftawareness.com/docs/WhatIsIdTheft.php

Source: http://reports.celent.com/Japanese/PressReleases/20030121/CreditCardFraud.htm

Incidents of identity theft relative to the size of each banking institution

Source: http://www.concurringopinions.com/archives/category/privacy-id-theft

Security of citizens is dependent on social security number, which is printed on a social security card. Ironically the social security card is the most insecure card but it purpose is to provide social security.

Picture shows an identity thief taking Social Security Card from wallet.

NOTE: 36 percent of Americans age 18-49 and 43 percent of Americans age 50-plus carry their Social Security card in their wallet.

Also, the social security card can be faked easily. Fake ID’s that include social security card are common among illegal immigrants. Social security cards and other fake ID’s sold in flea market3.

Fake Social Security Cards and other ID’s

Currently for opening credit card account etc people give their SSN over the phone or over the internet that can be easily overheard or hacked. Also, many criminals pose as they are from a bank and get personal information such as SSN from people over phone. Once the criminal knows someone’s SSN he can go to bank and open account and the bank people don’t check social security card for verification. To reduce identity theft the SSN should be always be used along with social security card. Since SSN has become a national identifier for individuals in the United States it is very important information and should be well protected. SSN in the current social security card is like precious jewels in a transparent plastic bag. The government is realizing this fact and proposals are being made for use of a biometric smartcard based social security card4.

Unfortunately this biometric smartcard technology has been used in creditcards and e-passports that have been successfully clones in minutes5,6 . Using such clone-able technology based social security card to protect SSN is not sufficient. If United States really wants to reduce identity theft then the technology used in the social security card should be fake-proof and imposter proof (incase stolen the card should be unresponsive to fake biometrics).

e-Smart Technologies Inc., a pioneer in developing biometric security systems, has developed a unique biometric fingerprint match-on-card. In this match-on-card the fingerprint template of the person is secured through encryption and never leaves the card during authentication process. Thus there is no risk of fingerprint to be stolen from the card by electronic eavesdropping or skimming etc. Also the card is dummy/fake finger proof because it can judge presence of fake finger electrically and via software.

http://nepalinirelandnews.blogspot.com/2008/05/dublin-shop-workers-bribed-to-help-in.html (Dublin lasercard bank fraud).
http://www.timesonline.co.uk/tol/news/uk/crime/article4467106.ece (Fake-proof e-passports cloned in minutes)