Robert Siciliano Identity Theft Expert
Stealing the identity of the living is so 2009. Stealing the identity of the dead is so wrong, and so easy. It is made even easier by public records. A provision in federal law that reformed welfare in the 1990’s also created a loophole that could allow swindlers to obtain the Social Security numbers of the recently deceased.
In some state’s, Registry of Vital Records and Statistics include Social Security numbers on all certified death certificates. And anyone can obtain a death certificate from the registry for $18.
Wired reports Identity thieves filed for $4 Million in tax refunds using names of living and dead. A group of sophisticated identity thieves managed to steal millions of dollars by filing bogus tax returns using the names and Social Security numbers of other people, many of them deceased.
The thieves operated their scheme for at least three years from January 2005 to April 2008, allegedly filing more than 1,900 fraudulent tax returns involving about $4 million in refunds directed to more than 170 bank accounts. The conspirators used numerous fake IDs to open internet and phone accounts, and also used more than 175 different IP addresses around the United States to file the fake returns, which were often filed in bulk as if through an automated process.
The scam took advantage of the IRS’ quick turnaround in processing refunds for electronically filed returns. The IRS typically processes a refund request without verifying the taxpayer’s information — such as whether the taxpayer is alive — or confirming that the taxpayer is legitimately owed money.
Generally, a death is reported to the Social Security administration in a relative and timely fashion, but not always. As far as I can tell there is no form for merely “reporting a death” to the IRS. However, the IRS demands a final accounting, and it’s up to the executor or survivors to file the paperwork. When a taxpayer dies, a new taxpaying entity – the taxpayer’s estate – is born to make sure no taxable income falls through the cracks.
The 3 credit bureaus maintain a list of deceased based on the Social Security Administration’s data. However it can take a months for the bureaus to update their databases with information from the SSA. By contacting the credit agencies directly, you can report a death and have more confidence that the information will be used immediately.
Protect your identity.
1. Get a credit freeze and follow the steps for your particular state. This is an absolutely necessary tool to secure your credit. In most cases, it prevents new accounts from being opened in your name. This makes your Social Security number useless to a potential identity thief.
2. Invest in Intelius identity theft protection and prevention. Not all forms of identity theft can be prevented, but identity theft protection services can dramatically reduce your risk. (Disclosures)
Robert Siciliano Identity Theft Speaker discussing Social Security numbers on Fox News.