Social Security Subcommittee Hearing

From the Social Security Subcommittee of the House Ways and Means Committee:

McNulty Announces a Hearing on Protecting the Privacy of the Social Security Number from Identity Theft

Congressman Michael R. McNulty (D-NY), Chairman, Subcommittee on Social Security of the Committee on Ways and Means, today announced that the Subcommittee will hold a hearing to examine the role of Social Security numbers (SSNs) in identity theft and options to enhance their protection. The hearing will take place on Thursday, June 21, in room B-318 Rayburn House Office Building, beginning at 10 a.m.

In view of the limited time available to hear witnesses, oral testimony at this hearing will be from invited witnesses only. However, any individual or organization not scheduled for an oral appearance may submit a written statement for consideration by the Subcommittee and for inclusion in the printed record of the hearing.

BACKGROUND

As many as ten million Americans fall victim to identity theft every year. The effects of identity theft can be catastrophic to the lives of affected individuals. The reported costs are significant - according to the Federal Trade Commission, businesses lose $50 billion and consumers expend another $5 billion annually to recover from identity theft. The SSN is a critical tool for identity thieves looking to establish a credit account in someone else’s name. And it is often the key that identity thieves use to gain access to other personal information such as bank accounts.

Because it is a unique piece of personal information that does not change over time, the SSN provides a convenient way to track individuals throughout public and private records. As a result, SSNs have become ubiquitous in these records, and they are being used for purposes far beyond their original role of tracking earnings in order to compute Social Security benefits. While the widespread use of SSNs can be advantageous to business and government, it is also useful for identity thieves and other criminals. Moreover, records containing the SSN are increasingly available in electronic form, and easily accessible over the Internet. Thus, the need for streamlined business processes and openness of public records must be balanced against the increasing risks of identity theft and other crimes.

Despite its widespread usage, there is no Federal law that requires comprehensive confidentiality protection for the SSN. An SSN may be found on display to the general public on employee badges and in court documents, or offered for sale on the Internet. Some limited protection of SSN confidentiality is provided by the Fair Credit Reporting Act (P.L. 91-508) and the Gramm-Leach-Bliley Act (P.L. 106-102), which restrict the use and disclosure of SSNs by financial institutions. Also, many states have enacted legislation to restrict the use, disclosure or display of SSNs. Still most private sector use of the number remains unregulated.

In the 108th Congress, the Committee on Ways and Means approved comprehensive legislation to enhance SSN privacy to protect against identity theft (H.R. 2971; H. Rept. 108-685). Among other provisions, the bill would restrict the use, sale, purchase or display of SSNs. Members of Congress concerned about the magnitude of identity theft and its devastating effects on victims have introduced similar legislation this year.

In announcing the hearing, Chairman McNulty stated “there is no question that we need stronger protections for Social Security numbers to combat the growing crime of identity theft. Identity theft can destroy an individual’s or family’s financial well-being with a touch of a button. We must begin to place some common-sense limits on the use of the SSN by government and business in order to ensure the privacy of the information and prevent theft.”

FOCUS OF THE HEARING

The Subcommittee will examine what role the SSN plays in identity theft, and the steps that can be taken to increase SSN privacy and thereby limit its availability to identity thieves and other criminals. The hearing will examine how SSNs are currently used, what risks to individuals and businesses arise from its widespread use and options to restrict its use in the public and private sectors.