Justin’s note: Today, I’m featuring an essay from my colleague Greg Wilson, analyst for The Palm Beach Letter. It’s one every Dispatch reader should read closely.
Below, Greg talks about a subject we take very seriously here: the growing identity theft crisis. Read on to see why social security numbers will quickly become a thing of the past…and more importantly, how you can start protecting yourself today…
By Greg Wilson, analyst, The Palm Beach Letter
On September 7, hackers got the crown jewels.
Names, Social Security numbers, birthdates, addresses, and driver’s license numbers to nearly every adult in America.
Everything you would need to set up a new account or commit identity fraud.
I’m talking, of course, about Equifax.
Its data breach exposed the personal information of 143 million Americans. That’s nearly half of the U.S. population.
Per cybersecurity expert Jeremiah Grossman: “It’s a safe assumption that everyone’s Social Security number has been compromised and their identity has been stolen.”
The story highlights the problem with the current way we store sensitive information. Companies store records in a central database.
That creates a “honeypot” of information for cybercriminals. And the honey is just too sweet for the fraudsters to pass up.
Equifax is not alone. Verizon and Bell Canada, among others, both suffered data breaches this year.
And it’s leading to the question: How are we going to fix our identity crisis?
In a moment, I’ll fill you in on a potential solution. And I’ll show you ways to protect yourself now.
Social Security Numbers Must Go
The government created Social Security numbers in 1935 to track the earnings history of workers. That way they could take part in benefits programs.
Today, the number tracks our entire financial history.
After the Equifax hack, many think it should change.
Tom Sosnoff is the co-founder of Thinkorswim. He said, “The era of Social Security numbers as user name and password is over. They were never intended to be a personal identifier.”
The Trump administration agrees. It announced it was exploring ways to replace the use of Social Security numbers.
Trump even tasked federal agencies to come up with a new identity system.
Said White House cybersecurity coordinator Rob Joyce, “I feel very strongly that the Social Security number has outlived its usefulness. Every time we use the Social Security number, you put it at risk.”
He wants a better solution that uses the latest technologies.
One idea suggested is India’s Aadhaar identity system.
Aadhaar uses biometrics combined with unique identity numbers. However, the U.S. needs a more secure solution.
I think the U.S. government may end up looking to our neighbors up north.
Your New Digital Identity
That’s where SecureKey Technologies is working with the Canadian government and IBM. Together, they are developing a new digital identity system.
Select financial institutions are testing the network. And the Canada Revenue Agency uses it to simplify the login process for citizens.
The goal is to launch the network by the end of the year.
Consumers can opt in to the network. Once in, they can control what information they share with organizations.
Take renting an apartment, for example. You’ll use your digital ID to prove who you are to the landlord.
The same digital ID will also release your credit, background, and employment history. The landlord saves on fees for credit and background checks. And you have less paperwork to fill out.
But it doesn’t stop there. You can also use your digital ID to pay the deposit and get renters’ insurance. You can even set up your utilities like phone and cable.
SecureKey also envisions using biometrics (like fingerprints, retinal scans, etc.). That way you can connect consumers’ physical identities to their digital identities.
It’ll be a whole new world of identity. No longer will hackers be able to steal your information. And it makes financial sense, too.
SecureKey did a study on Canada’s government call centers. The study showed the government would save $800 million using this new identity network. That’s just one use case.
The New Technology Behind Your Digital Identity
Will the U.S. follow Canada’s lead? I think it’s a distinct possibility.
Joyce gave a hint. He suggested a “modern cryptographic identifier.”
In other words, the blockchain.
And that’s exactly the technology SecureKey is using for its identity ecosystem. It runs on the IBM blockchain.
By design, there’s no central database or “honeypot” of data. The data is never visible to the operators of the network. And no one can see where your identity is used.
That means it won’t be long until Social Security numbers are a relic of the past.
Until then, the best course of action is to be vigilant. Take the few extra minutes each month to review your credit and financial reports.
And if you’re not sure if you were impacted by Equifax, check here.
Analyst, The Palm Beach Letter
P.S. The blockchain is the underlying technology for cryptocurrencies. And the World Economic Forum predicts that 10% of the world’s GDP will be exchanged on the blockchain within 10 years’ time. That’s a staggering $8 TRILLION in wealth.
No one in this business knows more about blockchain technology than former hedge fund manager Teeka Tiwari. Teeka says this technology is growing at such an exponential rate, it's poised to take over everything—from getting a car loan to buying stocks. Learn more here.
Doug Casey’s recent interview on Russia has proven to be one of our most popular pieces this year. Today, Dispatch readers share their thoughts…
You are very much on the ball here. Governments need an external enemy to “protect” us from in order to justify their existence. If people could just get along together and work out through negotiation any differences that may develop, we would not need government or lawyers.
The problem is that so many people are looking for a free ride wherever they can find it. So we have to put up with an oppressive, power-seeking government, which is so corrupt that it defies description or understanding.
I have traveled through Russia and thought the same thing. I was surprised at several things. One, about 1/3 of men are alcoholics and can’t contribute to the country. It is an extremely poor country. I didn’t see smoke coming from a single factory. And finally, they can’t make anything of quality. Not a car, a house, or a road. I realized they could never be a threat to us.
Excellent newsletter on Russia. I just have a couple of comments. Regarding how much of a threat we keep being told they are, I remember back in the ’70s and ’80s being told about how dangerous their ICBMs [intercontinental ballistic missiles] and air and ground forces were.
My dad was in the Air Force, and I was extremely interested in things military and economic. After reading several things that came out in the last 15 years or so I realize that we were just being fed a bunch to scare us and President Reagan was being told by his trusted advisors what they knew were lies but what conformed to his understanding of the situation. I've ever since doubted everything that I've heard from our leaders.
Regarding accusations about election hacking, I am certain they couldn't actually hack the results, but if they could I wouldn't blame them a bit. Hillary is a bloodthirsty lizard who was spoiling for a fight with Russia. If the Russians could avoid WWIII by getting Trump elected, more power to them!
And two readers share their appreciation for Doug:
Thanksgiving time is any time you feel god has helped someone to bless you; thanks Doug Casey for unbiased truth!
I send you and your families my prayers for blissful health, wondrous happiness, deep peace, and sweet love now and always.
I love you Doug! You are so frigging smart and well-read and rational and express yourself so well! I have seriously considered moving to Argentina just to hang out with you at happy hour at your resort bar. I feel confident it would be the high point of my life!
But alas, I live in China where I am already in bliss, reading your Daily Dispatches. I sit down with a Daily Dispatch and a glass of red wine and imagine we are sitting at your bar there. Besides, this way, I get the added bonus of Justin asking the questions on my behalf! Great job guys. Keep up the good work! You are one of the best things about the internet!
Doug and Justin, may the angels of peace and happiness be frequent visitors to your home. Blessings!