That's right: Social Security numbers were not intended for identification. They were made to track how much money people made to figure out benefit levels. That's it. Before 1972, the cards issued by the Social Security Administration even said, "For Social Security purposes. Not for Identification." The numbers only started being used for identification in the 1960s when the first big computers made that doable. They were first used to identify federal employees in 1961, and then a year later the IRS adopted the method. Banks and other institutions followed suit. And the rest is history.Author: Adam Levin, Former Director New Jersey Division of Consumer Affairs; Chairman of Credit.com and Identity Theft 911.
There's a lot of good data in the article about just how much fraud is perpetrated against the IRS, fraud that is at least partly due to over-reliance on the Social Security number for ID purposes.