[Federal Register Volume 75, Number 162 (Monday, August 23, 2010)]
[Rules and Regulations]
[Pages 51619-51623]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-20856]



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  Federal Register / Vol. 75, No. 162 / Monday, August 23, 2010 / Rules 
and Regulations  

[[Page 51619]]



DEPARTMENT OF HOMELAND SECURITY

Office of the Secretary

6 CFR Part 5

[Docket No. DHS-2010-0054]


Privacy Act of 1974: Implementation of Exemptions; Department of 
Homeland Security/United States Citizenship and Immigration Services--
009 Compliance Tracking and Management System of Records

AGENCY: Privacy Office, DHS.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Department of Homeland Security is issuing a final rule to 
amend its regulations to exempt portions of a Department of Homeland 
Security/United States Citizenship and Immigration system of records 
entitled the ``United States Citizenship and Immigration Services--009 
Compliance Tracking and Management System of Records'' from certain 
provisions of the Privacy Act. Specifically, the Department proposes to 
exempt portions of the Department of Homeland Security/United States 
Citizenship and Immigration Services--009 Compliance Tracking and 
Management System of Records from certain provisions of the Privacy Act 
because of criminal, civil, and administrative enforcement 
requirements.

DATES: This final rule is effective August 23, 2010.

FOR FURTHER INFORMATION CONTACT: For general questions please contact 
Monitoring and Compliance Branch Chief (202-358-7777), Verification 
Division, U.S. Citizenship and Immigration Services, Department of 
Homeland Security, 470 L'Enfant Plaza East, SW., Suite 8204, 
Washington, DC 20529. For privacy issues please contact: Mary Ellen 
Callahan (703-235-0780), Chief Privacy Officer, Privacy Office, 
Department of Homeland Security, Washington, DC 20528.

SUPPLEMENTARY INFORMATION:

Background

    The Department of Homeland Security (DHS) published a notice of 
proposed rulemaking (NPRM) in the Federal Register, 74 FR 23957, May 
22, 2009, proposing to exempt portions of the DHS/United States 
Citizenship and Immigration Services (USCIS)--009 Compliance Tracking 
and Management System (CTMS) of Records from certain provisions of the 
Privacy Act because of criminal, civil, and administrative enforcement 
requirements. The DHS/USCIS--009 Compliance Tracking and Management 
system of records notice (SORN) was published concurrently in the 
Federal Register, 74 FR 24022, May 22, 2009 and comments were invited 
on both the NPRM and SORN. Comments were received on both the NPRM and 
SORN.

Comments on the Notice of Proposed Rulemaking (74 FR 23957, May 27, 
2009)

    DHS/USCIS received seven comments on the NPRM (74 FR 23957, May 22, 
2009) and twelve on the SORN (74 FR 24022, May 22, 2009). One set of 
comments relates to a potential operational concern with the SAVE 
program that pertains to the DHS/USCIS--004 Verification Information 
System (VIS). While CTMS does deal with SAVE data, the comments in 
question did not relate to compliance and monitoring issues. These 
comments are being addressed by the SAVE program. Another set of 
comments concerned corporate hiring practices and did not relate to 
CTMS or compliance and monitoring issues generally.
    Below is an analysis of each comment that specifically relate to 
this NPRM that is not addressed directly above. Comments were received 
from the National Immigration Law Center (NILC) regarding several 
elements of the CTMS SORN and corresponding Notice of Proposed 
Rulemaking (NPRM)
    Comment: NILC stated that law enforcement exemptions were overbroad 
and unwarranted.
    Response: The Department notes that Congress has stated its 
understanding that the USCIS employment verification system may be used 
for law enforcement purposes when necessary to prevent violations of 
the Immigration and Nationality Act (INA), and in cases of document 
fraud, counterfeiting and perjury (8 U.S.C. 1324a(d)(2)(F)). E-Verify 
was originally established for the purpose of serving as a 
``confirmation system through which [DHS]--
    (1) Responds to inquiries made by electing persons and other 
entities [* * *] at any time through a toll-free telephone line or 
other toll-free electronic media concerning an individual's identity 
and whether the individual is authorized to be employed, and
    (2) Maintains records of the inquiries that were made, of 
confirmations provided (or not provided), and of the codes provided to 
inquirers as evidence of their compliance with their obligations under 
the pilot programs.''. (8 U.S.C. 1324a note (at Sec.  404(a)) ``The 
confirmation system shall be designed and operated--
    (1) To maximize its reliability and ease of use by persons and 
other entities making elections under section 402(a) of this division 
consistent with insulating and protecting the privacy and security of 
the underlying information;
    (2) To respond to all inquiries made by such persons and entities 
on whether individuals are authorized to be employed and to register 
all times when such inquiries are not received;
    (3) With appropriate administrative, technical, and physical 
safeguards to prevent unauthorized disclosure of personal information; 
and
    (4) To have reasonable safeguards against the system's resulting in 
unlawful discriminatory practices based on national origin or 
citizenship status, including--
    (A) The selective or unauthorized use of the system to verify 
eligibility;
    (B) The use of the system prior to an offer of employment; or
    (C) The exclusion of certain individuals from consideration for 
employment as a result of a perceived likelihood that additional 
verification will be required, beyond what is required for most job 
applicants.''. (8 U.S.C. 1324a note (at Sec.  404(d))
    CTMS serves as a vehicle by which USCIS can comply with its 
statutory mandate to ensure the integrity of the verification system as 
outlined above. Information in CTMS may provide

[[Page 51620]]

evidence of the improper use of the E-Verify system which directly 
supports the statutory mandate to prevent the misuse, discriminatory or 
fraudulent use of the system. Furthermore, every request for access to 
information in CTMS will be evaluated with the predisposition to 
releasing the information. USCIS will only claim the exemption if it 
determines that releasing the information would be contrary to a law 
enforcement purpose.
    Comments were received from the American Immigration Lawyer 
Association (AILA) regarding several points.
    Comment: AILA objected to the 30-day comment period.
    Response: The Department notes that the Administrative Procedure 
Act (``APA''), 5 U.S.C. 553(c), provides that ``each agency that 
maintains a system of records shall at least 30 days prior to 
publication of information under paragraph (4)(D) of this subsection, 
publish in the notice in the Federal Register any new use or intended 
use of the information in the system, and provide an opportunity for 
interested persons to submit written data, views, or arguments to the 
agency.'' In the absence of a demonstration of a compelling need to 
extend this period, such as numerous requests for additional time or 
when the subject of the proposed governmental action is complex or 
exceedingly controversial, the 30 days provided for under the APA 
provides an opportunity for thorough, well-informed rulemaking. While 
AILA's comments were the only comments submitted past the 30-day time 
period, USCIS did consider their comments. Based on the public comments 
received thus far, there is nothing to suggest that there was a need 
for additional time.
    Comment: AILA commented that the use of CTMS for law enforcement 
support is contrary to Congressional intent.
    Response: Congress has stated its understanding that the USCIS 
employment verification system may be used for law enforcement purposes 
when necessary to prevent violations of the INA, and in cases of 
document fraud, counterfeiting, and perjury in the INA 8 U.S.C. 
1324a(d)(2)(F). 8 U.S.C. 1324a note (at Sec.  404(d)) requires that E-
Verify have ``reasonable safeguards against the system resulting in 
unlawful discriminatory practices based on national origin or 
citizenship status, including--(A) The selective or unauthorized use of 
the system to verify eligibility; (B) the use of the system prior to an 
offer of employment; or (C) the exclusion of certain individuals from 
consideration for employment as a result of a perceived likelihood.''
    CTMS serves as a vehicle by which USCIS can comply with its 
statutory mandate to ensure the integrity of the verification system by 
preventing the fraudulent use of E-Verify and SAVE and violation of the 
INA, as well as any misuse or discriminatory use of the system (8 
U.S.C. 1324a note (at Sec.  404(d))).
    Comment: AILA expressed concern that because E-Verify is only a 
pilot, any results from the system should be used only for education 
and outreach, not law enforcement purposes.
    Response: The Department acknowledges that as long as E-Verify is 
operational, there is the potential that it will be misused or abused. 
The monitoring and compliance functionality has been established to 
identify and resolve noncompliance. This is particularly important, 
regardless of the programs' status as a pilot, where misuse of the 
system has an immediate effect on a person's ability to work. CTMS is 
an integral component of these monitoring and compliance activities, as 
it allows for compliance activity management and storage of the 
information supporting the compliance determinations surrounding use of 
the program.
    Comment: AILA expressed concern that CTMS is not an effective way 
to reduce identity theft, and recommends that all multiple uses of A-
Number or SSN should result in a Tentative Non-Confirmation (TNC) 
rather than additional further research into the employer.
    Response: The Department is aware of the potential for fraudulently 
used identity documents to be verified through the system. The USCIS 
Verification Division, the component of DHS responsible for the E-
Verify Program and CTMS, meets with AILA annually. During a meeting 
held May 7, 2009, AILA and representatives from the Verification 
Division discussed the monitoring of multiple SSNs. USCIS is 
researching solutions to this potential problem. However, multiple uses 
of A-Number or SSN identifications do not warrant automatic TNCs since 
it is feasible for one individual to be accurately verified in the 
system multiple times, where they may hold multiple jobs or change jobs 
frequently. Hence, multiple uses of an A-Number or SSN are not 
necessarily fraudulent and should not result in a TNC in all cases. In 
fact, the inconvenience that would be caused to individuals who are 
rightly verified multiple times would outweigh the benefit of automatic 
TNCs. CTMS would be used to determine under which circumstances such 
incidents of multiple uses would indicate a need for further compliance 
research and would be the tool to manage any resulting compliance 
activity.
    Comment: AILA expressed concern that an employer might try to 
protect itself from law enforcement activities by only selecting 
employees the employer perceives to be without any potential for 
immigration-related violations, thereby increasing immigration-related 
discrimination.
    Response: The Department agrees that E-Verify users may try to 
insulate themselves from law enforcement activities by discriminatory 
use of these systems. As the Department has already developed a 
relationship for forwarding potential violations to the Department of 
Justice (DOJ) Office of Special Counsel (OSC) as required by law, it is 
vital that the monitoring and compliance activities be well developed 
and managed to ensure that E-Verify is looking carefully at these 
issues.
    Comment: AILA suggested that there are better methods for reducing 
discrimination and misuse of E-Verify including: (1) Improving posters 
and providing alternative means of notification; (2) involving OSC more 
directly in E-Verify education and outreach efforts; (3) modifying E-
Verify case resolution functionality; (4) enhancing E-Verify user 
reports; and (5) providing better training and reporting tools to 
corporate and program administrators.
    Response: The Department agrees that there should be an ongoing 
process of evaluating and improving the methods that are used to 
prevent and detect misuse. In fact, AILA's suggestion regarding 
improving posters is supported by the compliance activity of 
determining whether the posters are actually being used by employers. 
The development of the USCIS Verification Division Monitoring and 
Compliance Branch and the appropriate use of the CTMS tracking and 
managing tool are central to this ongoing initiative, and will be used 
in conjunction with other program enhancements to involve employers in 
the compliance assistance elements of E-Verify. In addition, E-Verify 
continuously evaluates and improves the means of educating users about 
the correct way to use E-Verify, and of informing the individuals being 
verified of their rights. E-Verify works closely with OSC, as 
appropriate, using the CTMS to guide referrals to the appropriate 
enforcement agency. Recent changes have included significant 
enhancements to the training processes and additional means of 
notification, including adding privacy information

[[Page 51621]]

on the E-Verify Web site. The Department is currently evaluating the E-
Verify case resolution functionality, determining additional ways to 
involve the users in the integrity of the programs and is investigating 
enhancements to the program's reporting capabilities, to address user's 
ability to evaluate and train individual users, and to use other means 
to assist users in the E-Verify processes. Further, USCIS signed a 
Memorandum of Agreement with the Department of Justice's Office of 
Special Counsel (OSC) for Unfair Immigration-Related Employment 
practices on March 17, 2010 that formally establishes the relationship 
and process for referrals between the agencies, and continued 
collaboration efforts, including E-Verify education and outreach.

Comments on the System of Records Notice (74 FR 24022, May 22, 2009)

    Comment: NILC expressed concern that the CTMS SORN does not 
adequately address how monitoring and compliance will be conducted 
given the expanded use of SAVE by States and localities.
    Response: The Department acknowledges that the expanded use of 
SAVE, as required by section 642(c) of the Illegal Immigration Reform 
and Immigrant Responsibility Act (Pub. L. 104-208, 110 Stat. 3009), 
will increase the number and types of SAVE users. These users will pose 
different monitoring and compliance challenges. However, all SAVE user 
agencies are subject to the policies and procedures governing use of 
the system. The Department is aligning the SAVE monitoring and 
compliance activities with the various agencies, whether federal, 
state, or local, in order to identify non-compliant behaviors 
regardless of the specific purpose of the SAVE query. In fact, in the 
vast majority of cases, the same type of SAVE query is conducted using 
the same information and documentation regardless of the purpose of the 
query. CTMS will be used to track and manage these monitoring and 
compliance activities and provide support for SAVE monitoring and 
compliance deliberative processes.
    Comment: NILC expressed concern that E-Verify focusing on an 
employer's election not to use E-Verify after registering for the 
program would be a waste of resources as it does not actually indicate 
misuse of the system.
    Response: The Department appreciates NILC concern that E-Verify not 
waste resources on a behavior that does not indicate a misuse of the 
system. However, once enrolled in E-Verify, employers are required to 
either verify all new hires through the system, or withdraw from E-
Verify. This is required in order to minimize the potential of an 
employer using the system in a potentially discriminatory manner by 
verifying some employees but not others. The Department also notes that 
this is a good example of a misuse that would be resolved in almost all 
cases by E-Verify providing compliance assistance to employers to help 
them understand what their responsibilities are. Although CTMS is used 
for identifying potentially illegal activities, compliance activities 
are primarily focused on education, training, and awareness to assist 
employers to better understand the purpose of E-Verify and their role 
in the process.
    Comment: NILC expressed concerns that, despite DHS' stated 
intentions, CTMS is designed to investigate immigration offenses by 
employees rather than misuse by employers.
    Response: The Department understands the NILC's concern, but in 
both the SAVE and E-Verify programs the Department is mandated to focus 
on the relationship with the agency or employer in its operational 
activities not on the applicant or employee being verified. Employers 
are the direct users of E-Verify as are SAVE agencies the direct users 
of SAVE, and it is with E-Verify employers and SAVE agencies that the 
E-Verify or SAVE Memoranda of Understandings (MOUs) are signed. The 
subject of E-Verify or SAVE verification would only be contacted if the 
compliance activity is based on a specific lead or tip first provided 
voluntarily to DHS by that subject. However, if in the course of 
research USCIS discovers evidence of fraud by an individual verified by 
SAVE or E-Verify, USCIS will evaluate those matters and may refer them 
to the appropriate law enforcement agency.
    Comment: NILC expressed concern that if CTMS is used for 
immigration enforcement and Privacy Act exemptions are granted, 
employees, those most likely to be able to witness and report on 
misuse, will be unwilling to make such reports.
    Response: Employee information is vital to compliance analysts for 
interpreting various user behaviors and the monitoring and compliance 
effort is essential to protecting the rights of the employee from abuse 
by employers and other employees, as well as determining if employer or 
agency users are in compliance with the program terms of use. 
Currently, as required by law, E-Verify forwards information that 
suggests illegal activities to appropriate law enforcement 
organizations. The Department acknowledges the risk that some employees 
may be unwilling to report cases of misuse of E-Verify or SAVE because 
of their concerns regarding CTMS's immigration enforcement capability 
and its Privacy Act exemptions. This risk however, is one that must be 
accepted in order to effectively and adequately protect the integrity 
of any law enforcement investigations that result from monitoring and 
compliance activities within CTMS.
    Comments were received from the American Council on International 
Personnel (ACIP) regarding two points.
    Comment: ACIP requested that E-Verify should work directly with 
employers before any effort is made to refer potential issues to law 
enforcement organizations.
    Response: The Department agrees with ACIP and E-Verify has 
developed an escalating approach to compliance in which noncompliance 
is resolved by contacting and working with the employer directly when 
possible. The purpose of collecting information in the CTMS is to allow 
compliance analysts to determine the correct approach to involving the 
employer or agency in the compliance process. E-Verify begins from a 
position of ``compliance assistance,'' which is to educate employers 
and ensure proper policies and procedures are followed. If, after the 
employer has been contacted, noncompliance is ongoing or more 
egregious, E-Verify may escalate to compliance activities that involve 
more direct interaction with employers, which may include collecting 
additional information from the employer for analysis. For those 
situations where USCIS believes there is more egregious noncompliance, 
E-Verify may make a referral to a law enforcement agency for the 
appropriate enforcement action. CTMS tracks and manages this process.
    Comment: ACIP suggested the use of additional advanced technologies 
to prevent fraud and misuse.
    Response: The Department appreciates ACIP's comment and is 
continuing to investigate a number of technologies and processes that 
would increase the integrity of the SAVE and E-Verify program, but 
believes that as no technology will be able to stop all cases of 
misuse, DHS must develop a system and process for researching, 
tracking, and managing potential cases of misuse, abuse, fraud, or 
discrimination.
    Comment: AILA expressed concern that CTMS is beyond the scope of 
authority for E-Verify established by IIRIRA, but that if CTMS is to be 
used it should be used as a tool to focus

[[Page 51622]]

attention on employees who might be misusing documentation.
    Response: The Department is aware of the need to ensure that that 
E-Verify and SAVE are not misused. However, because these programs work 
directly with the employers and SAVE agencies, and do not have a direct 
relationship with the individuals being verified, it is necessary to 
focus on the users of the programs. Thus, the employers and SAVE agency 
users create a contractual relationship with DHS through their 
registration and signing of the program Memoranda of Understanding 
(MOUs) which establish the parameters of their use. In light of this 
relationship, the Department can work to train users on the correct use 
of the programs. Until Congress directs otherwise, these programs must 
focus on the E-Verify and SAVE users.
    Comment: AILA expressed concern that DHS failed to consult with 
employer representatives in the development and implementation of E-
Verify as required by IIRIRA, Section 402(d)(1).
    Response: E-Verify works with the user population on changes to 
continuously improve the program, through outreach and interaction with 
employers and agencies by conducting training sessions, Webinars, and 
outreach events throughout the United States. These outreach 
initiatives have resulted in changes to E-Verify, for example changes 
have been made to simplify E-Verify language and to change data 
handling procedures to make it more convenient for employers and 
employees using E-Verify. E-Verify also evaluates and implements, where 
possible, the suggestions of employer advocacy organizations, for 
example the program is currently evaluating changes to the program that 
would increase enhanced program authentication methods. The Westat 
Reports, the statutorily mandated third party review of E-Verify, are 
published to the Web to inform employers of recommendations for 
improving the integrity of the program. These efforts meet the 
requirements of IIRIRA Sec.  402 (d)(1) which provide that DHS ``shall 
closely consult with representatives of employers (and recruiters and 
referrers) in the development and implementation of the pilot programs, 
including the education of employers (and recruiters and referrers) 
about such programs.''
    Comment: AILA recommended that DHS not devote resources to the CTMS 
system until release of the pending Westat Report.
    Response: The Westat Reports of 2002 and 2007 recommended that 
USCIS develop monitoring and compliance capability. The USCIS 
Verification Division Monitoring and Compliance Branch has developed 
CTMS as a support tool for its operations. Recommendations from the 
next Westat Report, along with experience from monitoring and 
compliance activities, will be an input to this continuous improvement 
function.
    USCIS Verification Division Monitoring and Compliance Branch 
operations have been developed based on best practices, as well as 
knowledge of the E-Verify system and the ways in which it could 
potentially be misused or abused. The previous Westat Reports served as 
a reference while the USCIS Verification Division Monitoring and 
Compliance Branch was being formulated; future Westat Reports will 
likewise be leveraged. However, the absence of a ``perfect'' E-Verify 
system should not preclude the establishment of a monitoring and 
compliance component, along with the associated tools, such as CTMS. As 
long as the system is being used, USCIS has a responsibility to ensure 
that the system is being used appropriately and in accordance with 
program rules and regulations. The USCIS Verification Division 
Monitoring and Compliance Branch, and associated management tools, 
fulfill that function.
    Having taken into consideration and addressed public comments 
resulting from this NPRM and SORN, as well as the Department's position 
on these public comments, DHS will implement the rulemaking as 
proposed.

List of Subjects in 6 CFR Part 5

    Freedom of information; Privacy.

0
For the reasons stated in the preamble, DHS amends Chapter I of Title 
6, Code of Federal Regulations, as follows:

PART 5--DISCLOSURE OF RECORDS AND INFORMATION

0
1. The authority citation for Part 5 continues to read as follows:

    Authority: Pub. L. 107-296, 116 Stat. 2135, 6 U.S.C. 101 et 
seq.; 5 U.S.C. 301. Subpart A also issued under 5 U.S.C. 552. 
Subpart B also issued under 5 U.S.C. 552a.


0
2. Add at the end of Appendix C to Part 5, the following new paragraph 
``49'':

Appendix C to Part 5--DHS Systems of Records Exempt From the Privacy 
Act

* * * * *
    49. The DHS/USCIS--009 Compliance Tracking and Management System 
of Records consists of electronic and paper files that will be used 
by DHS and its components. This system of records will be used to 
perform a range of information management and analytic functions 
involving minimizing misuse, abuse, discrimination, breach of 
privacy, and fraudulent use of SAVE and E-Verify. The Secretary of 
Homeland Security has exempted this system from the following 
provisions of the Privacy Act, subject to the limitation set forth 
in 5 U.S.C. 552a(c)(3), (d), (e)(1), (e)(4)(G), (e)(4)(H), 
(e)(4)(I), and (f) pursuant to 5 U.S.C. 552a(k)(2). Exemptions from 
these particular subsections are justified, on a case-by-case basis 
to be determined at the time a request is made, for the following 
reasons:
    (a) From subsection (c)(3) (Accounting for Disclosures) because 
release of the accounting of disclosures could alert the subject of 
an investigation of an actual or potential criminal, civil, or 
regulatory violation to the existence of the investigation, and 
reveal investigative interest on the part of DHS as well as the 
recipient agency. Disclosure of the accounting would therefore 
present a serious impediment to law enforcement efforts and/or 
efforts to preserve national security. Disclosure of the accounting 
would also permit the individual who is the subject of a record to 
impede the investigation, to tamper with witnesses or evidence, and 
to avoid detection or apprehension, which would undermine the entire 
investigative process.
    (b) From subsection (d) (Access to Records) because access to 
the records contained in this system of records could inform the 
subject of an investigation of an actual or potential criminal, 
civil, or regulatory violation, to the existence of the 
investigation, and reveal investigative interest on the part of DHS 
or another agency. Access to the records could permit the individual 
who is the subject of a record to impede the investigation, to 
tamper with witnesses or evidence, and to avoid detection or 
apprehension. Amendment of the records could interfere with ongoing 
investigations and law enforcement activities and would impose an 
impossible administrative burden by requiring investigations to be 
continuously reinvestigated. In addition, permitting access and 
amendment to such information could disclose security-sensitive 
information that could be detrimental to homeland security.
    (c) From subsection (e)(1) (Relevancy and Necessity of 
Information) because in the course of investigations into potential 
violations of Federal law, the accuracy of information obtained or 
introduced occasionally may be unclear or the information may not be 
strictly relevant or necessary to a specific investigation. In the 
interest of effective law enforcement, it is appropriate to retain 
all information that may aid in establishing patterns of unlawful 
activity.
    (d) From subsections (e)(4)(G), (H), and (I) (Agency 
Requirements), and (f) (Agency Rules) because portions of this 
system are exempt from the individual access provisions of 
subsection (d) for the reasons noted above, and therefore DHS is not 
required to establish requirements, rules, or procedures with 
respect to such access. Providing notice to individuals with respect 
to existence of records pertaining to them in the system of records 
or otherwise setting up procedures

[[Page 51623]]

pursuant to which individuals may access and view records pertaining 
to themselves in the system would undermine investigative efforts 
and reveal the identities of witnesses, and potential witnesses, and 
confidential informants.

Mary Ellen Callahan,
Chief Privacy Officer, Department of Homeland Security.
[FR Doc. 2010-20856 Filed 8-20-10; 8:45 am]
BILLING CODE 9111-97-P