“… there is no silver bullet”
Let’s hear it for Bernard F. McKay of Intuit (publishers of the popular TurboTax program) who was the one witness at yesterday’s hearing before the Senate Finance Committee’s Subcommittee on Fiscal Responsibility & Economic Growth1 who clearly stated the reality of identity theft.
And what was it that he said that’s so remarkable? He said, and I quote, that when it comes to solving the problems of identity theft, “… there is no silver bullet.”2
In other words, closing off access to the Social Security Death Master File (or SSDI as we genealogists know it) is not going to be any kind of easy fix to this growing international problem. He didn’t say the words, but I will: it’s time to stop using the SSDI as a punching bag.
McKay’s statement and those of other witnesses yesterday made it clear that identity theft and the filing of fraudulent tax returns is a huge business with enormous potential rewards for rings of organized criminals. He and other witnesses outlined the many many ways that identity thieves obtain the information they use to file fraudulent tax returns for hundreds of thousands of taxpayers — most of them living persons whose identities couldn’t have come from the SSDI.
Detective Sal Augeri of the Tampa Police Department noted that the organized crime rings may have once used SSDI information but “turned to individuals who worked in Assisted Living Facilities who would obtain necessary information on patients. Lists of names are now being sold by those having access to personal information in businesses, medical offices and schools.”3
Ronald A. Cimino, Deputy Assistant Attorney General in the Tax Division of the U.S. Department of Justice, told of a woman from Alabama who obtained names and Social Security numbers of student loan borrowers from electronic databases of a former employer.4
Steven T. Miller, Deputy Commissioner for Services and Enforcement of the Internal Revenue Service, also cited the Alabama student loan case and gave other examples:
• An Arizona man who used stolen identities of disabled individuals to claim more than $1 million in bogus tax refunds.
• An Alabama woman who was the owner of a tax preparation business and used her business to gain information to file more than $1.1 million in fraudulent returns.5
Notice anything about these examples? The victims were alive, not dead. I repeat: their information couldn’t have come from the SSDI.
That didn’t stop some of those at the hearing from continuing to use genealogists and the SSDI as a punching bag. In particular, the sponsor of this bill, Sen. Bill Nelson (D-Fla.) kept mentioning the death master file and the availability of the SSDI to genealogists despite the lack of evidence from the other witnesses about its use in identity theft and despite the emphasis by the witnesses on tax fraud using information about living persons.
And Nina E. Olson, the National Taxpayer Advocate, continued to harp on the notion that there’s some sort of privacy interest in SSDI data that should prevent its disclosure. But even Olson seems to be coming around a little bit. Instead of talking about closing SSDI access completely, even she admitted that “there are many legitimate users of DMF information, and we should not restrict access any more than necessary to thwart tax-related identity theft.”6
How much is necessary? Not very much. A delay as provided for in the bill under consideration yesterday — death information would not be disclosed in the year of death or the calendar year thereafter7 — is something we could live with if we have to, especially since the bill has a program to certify people who need access sooner.8
So overall the hearing was better overall than last month’s House hearing — the focus there was on closing the SSDI completely9 — but our SSDI access is still very much at risk.
As a community and as individuals, we need to stay on top of this. Even punching bags should know not to let down their guard.
SOURCES
- U.S. Senate Committee on Finance, Subcommittee on Fiscal Responsibility & Economic Growth, Tax Fraud by Identity Theft, Part 2: Status, Progress, and Potential Solutions (http://finance.senate.gov/hearings/hearing/?id=8c908260-5056-a032-525c-4f663b8d35f8 : accessed 20 Mar 2012). ↩
- Statement of Bernard F. McKay, Chair, American Coalition for Taxpayer Rights, before the Senate Committee on Finance, Subcommittee on Fiscal Responsibility & Economic Growth, 20 March 2012 (http://finance.senate.gov/imo/media/doc/McKay%20Testimony.PDF : accessed 20 Mar 2012). ↩
- Statement of Detective Sal Augeri, Tampa Police Department, before the Senate Committee on Finance, Subcommittee on Fiscal Responsibility & Economic Growth, 20 March 2012 (http://finance.senate.gov/imo/media/doc/Augeri%20Testimony.pdf : accessed 20 Mar 2012). ↩
- Statement of Ronald A. Cimino, Deputy Assistant Attorney General, the Tax Division, U.S. Department of Justice, before the Senate Committee on Finance, Subcommittee on Fiscal Responsibility & Economic Growth, 20 March 2012 (http://finance.senate.gov/imo/media/doc/Cimino%20Testimony.pdf : accessed 20 Mar 2012). ↩
- Statement of Steven T. Miller, Deputy Commissioner for Services and Enforcement, Internal Revenue Service, before the Senate Committee on Finance, Subcommittee on Fiscal Responsibility & Economic Growth, 20 March 2012 (http://finance.senate.gov/imo/media/doc/FinalSTEVEMILLERsenfinanceIDtheft20march20121.pdf : accessed 20 Mar 2012). ↩
- Statement of Nina E. Olson, National Taxpayer Advocate, before the Senate Committee on Finance, Subcommittee on Fiscal Responsibility & Economic Growth, 20 March 2012 (http://finance.senate.gov/imo/media/doc/Olson%20Testimony.pdf : accessed 20 Mar 2012). ↩
- S. 1534, § 9(a), 112th Congress, 1st sess., Thomas.gov (http://http://thomas.loc.gov : accessed 19 Mar 2012). ↩
- Ibid., § 9(b). ↩
- See “SSDI Hearings: OUCH!,” The Legal Genealogist, posted 3 Feb 2012. ↩
Thanks, Judy. I had been wondering how the hearing were going. Hadn’t heard anything til reading your blog.
Sure wish the news were better, Margie, but at least it was better than the last hearing.
Should have mentioned: remember the bumper sticker, “When guns are outlawed, only outlaws will have guns!”? When the SSDI is closed (or death records, or newspaper notices, or, or, or…) identity theft will still exist as is evidenced by today’s testimony.
You absolutely have that right.
Judy great posting and thanks for keeping us informed of what’s going on with this.
My mother always accused me of being too practical (is there such a thing?). I don’t understand why no one will ask the 1 question that needs to be asked. Why are the government agencies not working together with their information?
What kind of ACME government do we have that can’t figure out, at the very least, the Social Security administration and the IRS should be working together when it comes to making sure that deceased citizens are not on the tax rolls. Even our ancestors who did not have a college degree could figure that one out! geez
And why isn’t the IRS using the records to prevent fraud, rather than colluding to close the records? Good questions, all!
Judy,
Thanks for your postings on the hearings. If you are not aware, the OIG for the Social Security Administration (oig.ssa.gov) has been doing audits on the Death Master File since 2001 and been finding problems with living individuals on the file. If you go to the audit section of the website and search on “death master file” you can read the reports. The IG has testified to concerns about having the information in the file available to the public. Seeing the number of reports and management advisories they have issued I am surprised this issue has not come up before. It is not just an IRS issue. I used to work for an IG for another agency and they have a lot of influence on the Hill.
Thanks for that reminder, Jean. Of course, closing the index to genealogists won’t cure the problem of inaccurate info on living people since credit agencies and banks will still have access.