Fifty times a day, the Social Security Administration receives a report that someone has tried to steal a benefits check. Identity thieves are swooping in and rerouting direct deposits, leaving retirees — many on fixed incomes — in dire circumstances. And taxpayers are out millions. The government needs a new strategy.
Since it began tracking fraud reports last year, Social Security's inspector general has logged 19,000 complaints. While some are innocent mistakes by beneficiaries or computer errors by the government, the vast majority come from victims who had given out or lost their personal information only to have thieves redirect the victims' funds into their own bank account or debit card.
As the Tampa Bay Times' Patty Ryan has reported, identity theft has taken particular hold on the bay area. Tampa led the nation in tax refund fraud last year, as thieves locally stole $468 million from the U.S. Treasury. National losses are estimated at $5.2 billion. The Secret Service fears that Social Security benefits could be the next big target, as the federal government has shifted all but a small percentage of recipients to electronic payment plans.
Paying benefits electronically is in many ways more reliable and secure than mailing checks. But the government needs to dedicate resources to finding thieves and finding better security methods for ensuring the money is flowing to the right people. Americans are resigned to surrendering an enormous amount of personal information to conduct business with their doctor, bank and other service providers. That data needs to be better protected, and the government needs a better early-warning system to catch those fleecing the system.