Social security fraud is one of the worse forms of identity theft, primarily because it involves a person’s most important and valuable personal asset. The damage and the consequences associated with social security theft can completely ruin a person’s financial and social record. When a social security number is fraudulently used to collect social services, apply for employment and get federal or state medical benefits, the problems created for the victim are often difficult to correct and reverse.

What the ways that your social security number can be used?

Apply for employment - Often when individuals with criminal backgrounds find themselves looking for a second chance, which they’re not likely to get from employers who run background investigations, they may resort to stealing social security numbers or buying them from whoever offers this information for a fee. One of the most serious consequence of this is the recording of income under another person’s social security number. The IRS will normally contact the victim demanding back tax payments, late fees and penalties for failure to properly report income.

Social security fraud is often committed by illegal aliens who enter the country in search of any kind of employment. They may obtain social security numbers from criminal identity theft rings who specialize in selling this information. Ex-convicts are also among the biggest offenders in social security theft.

Social security benefits – The benefits that a person is due when they retire and are eligible for social security, runs more risks of running dry with the increase of social security theft. A person’s social security number can be used to take advantage of drawing social security payments, which can effect the victims future and welfare. In many cases the scams are run by people in the US to help family members overseas. In other words people in other countries collect social security benefits on your behalf.

Medical care - a social security number can also be used to apply for medical benefits either with a private insurance company or under federal or state benefits like Medicaid and Medicare. These are substantially dangerous cases, since besides the financial liabilities of caused by this type of social security fraud, the victim’s life can also be endangered if their own medical records are altered with someone else’s information. This is potentially the deadliest form of identity theft. For more information on the risks and consequences of this type of identity theft, see our articles on medical identity theft.

Business and credit accounts – The most common form of identity theft is having your existing credit accounts hijacked or ending up with new credit account in your credit file, for which an identity theft needs to have your social security number. However, one aspect of social security theft that maybe overlooked, is the potential for someone to actually begin a business venture with the use of someone else’s social security number. Obviously the risks here are very high, since the financial liabilities of a business failure could end up turning the victim’s life upside down overnight.

Reporting social security fraud.

If you know or suspect that you have been the victim of social security identity theft, here are the steps you need to take to begin resolving the issue and put a stop to any further damage.

Call the social security fraud hotline and provide as much information about your case as you can, about the incident of theft on your information. If the fraud incident includes more than the use of your social security number, and credit accounts, or utility accounts have been opened as well, follow the directions on our identity theft victim resources page.

To begin reporting your case to the social security administration (SSA) you need to print and fill out the Fraud Reporting Form and mail it to:

Social Security Fraud Hotline

P.O. Box 17768

Baltimore, Maryland 21235

Fax: 410-5970118

Phone: 1-800-269-0271 (TTY: 1-866-501-2101)

One other thing you need to be aware of when it comes to your social security number is the physhing scams where people contact you posing as representatives from the SSA. These scams almost always have the same premise, in which you’re either told that your information maybe in danger for whatever reason and that you must verify your social security number and date of birth in order to begin an investigation.

The same identity theft prevention approach applies here as it does for credit cards and bank account, no government organization ever contacts citizens asking them for their entire social security number. Typically when you call them directly there are some verification steps like last four digits of your social or street number. But receiving a call that specifically asks for this information should make you want to hang up and call the organization directly to find out if what they claim is true.