Statement by Dr. Shirley Charter,
Commissioner of Social Security,
before the House Governmental Reform and Oversight Committee,
Subcommittee on Government Management
March 7, 1995
Mr. Chairman and Members of the Subcommittee:
I am pleased to be here to discuss the integrity of the Social Security card as well as its role in the verification of employment eligibility. We look forward to working with you to address your concerns about the system.
The employment eligibility verification process is composed of two elements: verifying the identity of the job applicant and ensuring that the applicant has authority to work. SSA's role in the current work eligibility verification process is limited. A worker must present to an employer documents which establish either identity or authorization to work or both. Some documents serve as evidence of both elements, but most documents establish only one or the other. The Social Security card is in the latter category, indicating only whether the individual named on the card had authority to work when the card was issued.
For a variety of reasons which I will explain in my testimony, it is not feasible to use the current Social Security card for the purpose of establishing that the person in possession of the card is the person to whom it was issued. Perhaps no single document can guarantee identity.
History of the Social Security Card
Let me give you some background on the Social Security card. At the time the Social Security card was devised in the 1930's, its only purpose was to provide a record of the number that had been issued to the individual so that the employer could accurately report earnings for the individual. That is still the primary purpose for which SSA issues the card. It was never intended to serve as a personal identifier--that is, to establish that the person presenting it is actually the person whose name and Social Security number (SSN) appear on the card. Although we have made it counterfeit-resistant, it does not contain information that allows it to be used to establish identity.
Over time, however, the use of the SSN and Social Security card has greatly expanded, and the card is now used for purposes other than Social Security earnings record maintenance, including its use as evidence of authorization to work. Society's increasing use of computerized data has led to suggestions to use the SSN and the card as a personal identifier. The card itself, however, is still simply a paper record with a name and number on it.
Prior to 1971, all SSNs were issued based solely on information alleged by an individual. Because of the expanding use of the card for other purposes, there was concern about the integrity of the card. Beginning in 1971, certain categories of applicants were required to provide documentary evidence of age, identity, and alien status. This made it more-difficult to obtain a card on the basis of a false identity. However, the card was still no more than a reminder of the number assigned to the individual named on the card. Because of our concern that individuals who had been assigned SSNs for purposes other than work might use the card to obtain unauthorized employment, in July 1974, we began to annotate our records to reflect the fact that an alien had been issued a nonwork SSN. This allowed us to identify, and report to the Immigration and Naturalization Service (INS), instances in which Social Security earnings were reported on nonwork SSNs.
Several years later, the integrity of the SSN process was further improved. Since May 15, 1978, all applicants have been required to provide documentary evidence of age, identity, and U.S. citizenship or alien status. Generally, to obtain an original Social Security card, an applicant must submit at least two forms of acceptable evidence, such as a birth certificate and driver's license. Aliens must submit appropriate INS documents to establish lawful status.
Any alien other than one admitted for permanent residence receives a card indicating whether he or she is authorized to work. To obtain an unrestricted Social Security card, they must provide an alien registration receipt card displaying a photograph . This document is issued to aliens by INS.
Applicants for an original SSN age 18 or over are required to have a personal interview. During the interview the applicant is asked for prior names and surnames and the reasons for never before needing an SSN. For those who allege having been born in the U.S., SSA performs additional verification prior to the issuance of an original SSN because most people born in the U.S. have been issued an SSN by the time they have reached age 18. For instance, SSA verifies the existence of a birth certificate at the State Bureau of Vital Statistics for all applicants for original cards who are over 18, and initiates a search for a death certificate when there is reason to believe the applicant may be assuming a false identity.
Enumeration At Birth Initiative
The "Enumeration at Birth" (EAB) program was established in 1989 as another means of improving the SSN process. It is a valuable tool in preventing fraudulent acquisition of an SSN. This program allows parents in the 49 participating States (plus New York City, the District of Columbia, and Puerto Rico ) to indicate on the birth certificate information form whether they want an SSN issued to their newborn child. States provide SSA with birth record information about newborns whose parents want a Social Security card for their child, and SSA then assigns an SSN and issues a card. Approximately one-half of match the encoded information on the magnetic stripe. on-line systems, linked to a central data base, would be needed to both confirm the name and number match and verify the identifying data the card contains. The magnetic stripe on a plastic card is the technology most in use today. GAO reported that magnetic stripe readers cost $100-$150, a considerable outlay for many employers who would have no other use for the equipment. Also, they concluded that the commercial availability of readers and coding equipment for magnetic stripes makes this technology highly susceptible to counterfeiting. GAO also pointed out that rapid advances in card technology may quickly render obsolete any hi-tech anticounterfeiting efforts.
Changing the Social Security card by adding a photograph and requiring that it be signed when issued might make it more effective as an identity document, but people intent on fraud can substitute a photograph, modify their appearance, or reproduce signatures with practice. In addition, pictures on the card would require updating from time to time because of changes in personal appearance.
More effective biometric identifiers, such as fingerprints, require verification techniques that are expensive and that cannot be applied by nonexperts. A technology that has emerged for linking users to documents is the Personal Identification Number or PIN. Automatic teller machines in particular have popularized this technology. However, GAO noted that incorporating a PIN in a work eligibility document would require the use of card readers and on-line access to a data base matching the PIN with a unique code in a magnetic stripe on the card. Also, GAO reported that law enforcement authorities have found that many users write their PIN on the card or elsewhere in their wallet or purse in case they should forget it. Thus, if the card is stolen, the thief also has the PIN that permits him to use the card.
GAO concluded that the card would not be a good identifier because it does not satisfy three criteria for a reliable identity document. It must be difficult to counterfeit; allow verification that the person presenting the document is, in fact, the individual to whom it was issued; and be difficult to obtain fraudulently.
We share GAO's views that these are the appropriate criteria to use in evaluating identity documents. It appears that no single document can meet all three criteria, primarily because a determined individual can obtain a counterfeit document or a valid document through fraudulent means . Furthermore, efforts to develop a fraud-proof identity document for employment eligibility verification purposes would require major changes in the process of issuing birth certificates and be very expensive. While it is possible to develop a more counterfeit-resistant Social Security card, there are reasons aside from cost-effectiveness why it would not be an effective identity document.
False Documents Impede the Security of Social Security Cards
As I mentioned earlier, even if the Social Security card were enhanced, there would be no assurance that the card had been properly issued to an individual. This is because the documents which a Social Security card applicant must present -primarily a birth certificate and immigration forms--are relatively easy to alter, counterfeit, or obtain fraudulently.
In 1988, the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) issued a report entitled Birth Certificate Fraud which examined vulnerabilities to fraud in birth certificate forms and issuance procedures and in procedures of user agencies which receive birth certificates as documentation. The problems found by the OIG included:
- False birth certificates are used to create false identities;
- An estimated 7,000 local issuing offices issue some 10,000 different versions of birth certificate forms which may be submitted to user agencies for evaluation; and,
- States have open access to vital records, and there is lax physical security of blank forms and seals, especially in local offices.
In 1991, OIG issued a follow-up report on efforts to control birth certificate fraud. The relevant finding was that the nature and extent of birth certificate fraud appeared t o be relatively unchanged since 1988. OIG reported that major weaknesses in the procedures used by issuing agencies continued to hamper the ability of user agencies, both Federal and State, to rely on birth certificates as evidence of identity. The cost of revamping the system by which birth certificates are issued would be enormous, and while some State and local jurisdictions have initiated reforms, most are severely constrained from making major reforms by increasingly limited resources.
Logistics of Reissuance of Social Security Cards
Let me now discuss the logistics that would be involved in issuing enhanced Social Security cards to the almost 270 million current card holders. To be effective, a new card would have to be issued relatively quickly to all card holders. Otherwise, they could present earlier versions of the Social Security card and claim they had not yet been issued a new card. The process of verifying identities and reissuing everyone a new, more secure card would be very costly--from $3 to $6 billion from general revenues, depending on the security features and issuance procedures. (The $3-$6 billion does not include the potential cost to employers.) The additional cost of the secure feature itself (e.g., a bar code or photo) would be relatively small. However, the labor costs associated with interviewing, verifying evidence, and producing the card would make the total reissuance cost extremely high.
Issuing new cards to everyone would also be burdensome on the public, as individuals would be required to establish their identity and citizenship or lawful alien status satisfactorily before being issued a new card.
The workload that would result from the issuance of new Social Security cards to all card holders would primarily serve purposes other than the administration of the Social Security program and would be a tremendous challenge for the Agency and its employees. The volume of interviews required to reissue almost 270 million Social Security cards in 5 or even in 10 years could not be handled in SSA's 1,300 local offices, because it would interfere with the ability of the offices to properly serve the people needing help with Social Security problems at a time when the Agency is facing heavy workloads. The law provides that any changes made to the Social Security card for purposes of work eligibility must be financed from general revenues and not be borne by the Social Security trust funds.
Social Security Cards for Work Authorization
I would now like to discuss the role of the Social Security card as evidence of work authorization, which is a separate issue from personal identification. As you know, Mr. Chairman, IRCA makes it illegal for an employer to knowingly hire anyone not legally permitted to work in the U.S.; that is, aliens not authorized to work by INS. Under IRCA, all employers are required to verify a job applicant's identity and authorization to work . Any of a variety of documents specified in the law and in INS regulations can be used for this verification, which is required for all employees, regardless of citizenship or national origin . Some of these documents- such as a U.S. Passport--establish both employment eligibility and identity. Others --including the Social Security card--can be used to establish work authorization, but must be accompanied by an identification document, such as a State driver's license.
Originally, the same type of Social Security card was issued to all SSN applicants who requested one, whether or not they were authorized to work. Beginning in May 1982, a legend, "NOT VALID FOR EMPLOYMENT", was placed on the Social Security each State has been required to have an IEVS to match financial information received from public assistance claimants with information in Federal and State data bases so that they can identify claimants who are ineligible or who receive incorrect benefit payments.
Although EVS is used primarily by States, employers may also use EVS to verify SSNs for wage reporting or employment eligibility purposes. However, because EVS consists of a high volume process, under which the requests are transmitted to SSA by mail on magnetic tape and the results returned to the requestors in about 4 weeks, this system does not allow for immediate SSN verification. Thus, it may not effectively serve an employer's employment eligibility verification needs.
IRCA required the Secretary of Health and Human Services to study the feasibility, costs, and privacy considerations of an SSN validation system for employers. From January 1987 through September 1988, SSA tested a telephone system under which employers in 3 Texas cities requested SSN validations orally and received oral responses from SSA employees who had online access to SSA data bases. The test allowed employers t o use existing telephone lines and equipment to request SSN validation of prospective employees from SSA and receive an immediate response. This is similar to an employer's calling the BOO-number today, except that the test provided for a special staff dedicated to this specific function.
The test results indicated that, although technically feasible, the effectiveness of an SSN validation system in helping employers prevent aliens not authorized to work in this country from gaining employment would be limited, because there is no way to be sure that the job applicant presenting a valid Social Security card is the person to whom it was issued.
Employment Eligibility Verification Pilot Projects
The Commission on Immigration Reform's interim report to Congress in September 1994 proposed a computer registry based on SSA and INS data which employers could check to determine if a new employee is eligible to work. The Commission recommended that the President immediately pilot the registry in the five States with the highest levels of illegal immigration and several other States.
Our SSN data base is highly accurate and is updated overnight. Since the data base was established to carry out Social Security functions, such as to facilitate wage reporting, the data base and its supporting systems are not designed to support work eligibility verification, although they contain information that is useful for that activity. Because of this, we need new programming to support verification of work eligibility and to make the verification process more convenient for employers.
As I have indicated, we are concerned about the possible use of the Social Security card as an identity document, the costs associated with making it serve that purpose and its implications for individual privacy; nevertheless, we are committed to testing effective, nondiscriminatory means of improving the employment eligibility verification system. We fully understand and share the subcommittee's concerns about improving the integrity of the employment eligibility verification system. SSA will continue to assist employers in verifying employment eligibility and we will gladly work with the subcommittee to improve that system.