Supplemental Security Income: Sustained Management Attention	 
Needed to Address Residency Violations (20-MAY-04, GAO-04-789T). 
                                                                 
The Supplemental Security Income (SSI) program paid about $36	 
billion in benefits to about 6.9 million recipients in 2003. In  
recent years, the Social Security Administration (SSA) has	 
identified a general increase in the amount of annual		 
overpayments made to recipients who are not present in the U.S.  
as required by SSI program guidelines--a problem we refer as	 
"residency violations." This problem has caused concern among	 
both program administrators and policy makers. As such, GAO was  
asked to determine what is known about the extent to which SSI	 
benefits are improperly paid to individuals who are not present  
in the United States and to identify any weaknesses in SSA's	 
processes and policies that impede the agency's ability to detect
and deter residency violations. 				 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-04-789T					        
    ACCNO:   A10129						        
  TITLE:     Supplemental Security Income: Sustained Management       
Attention Needed to Address Residency Violations		 
     DATE:   05/20/2004 
  SUBJECT:   Accounting errors					 
	     Americans abroad					 
	     Beneficiaries					 
	     Eligibility criteria				 
	     Fraud						 
	     Internal controls					 
	     Overpayments					 
	     Social security benefits				 
	     Supplemental Security Income  Program		 

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GAO-04-789T

United States General Accounting Office

GAO Testimony

Before the Subcommittee on Human Resources, Committee on Ways and Means,
House of Representatives

For Release on Delivery

Expected at 10:00 a.m. EDT SUPPLEMENTAL

Thursday, May 20, 2004

SECURITY INCOME

     Sustained Management Attention Needed to Address Residency Violations

Statement of Robert E. Robertson, Director Education, Workforce, and Income
Security Issues

GAO-04-789T

Highlights of GAO-04-789T, a testimony before the Chairman, Subcommittee
on Human Resources, Committee on Way and Means, House of Representatives

The Supplemental Security Income (SSI) program paid about $36 billion in
benefits to about 6.9 million recipients in 2003. In recent years, the
Social Security Administration (SSA) has identified a general increase in
the amount of annual overpayments made to recipients who are not present
in the U.S. as required by SSI program guidelines-a problem we refer as
"residency violations". This problem has caused concern among both program
administrators and policy makers. As such, GAO was asked to determine what
is known about the extent to which SSI benefits are improperly paid to
individuals who are not present in the United States and to identify any
weaknesses in SSA's processes and policies that impede the agency's
ability to detect and deter residency violations.

May 20, 2004

SUPPLEMENTAL SECURITY INCOME

SUSTAINED MANAGEMENT ATTENTION NEEDED TO ADDRESS RESIDENCY VIOLATIONS

Overpayments resulting from residency violations totaled about $118
million between 1997 and 2001. However, this figure, which represents only
violations detected by SSA, likely understates the true level of the
problem. Additionally, the extent of violations appears to vary by
geographic region, with overpayments being more prevalent in several large
metropolitan areas. GAO found that 54 percent of all overpayments detected
by SSA during this period occurred in just 15 counties. In addition, we
found that recipients born outside the United States accounted for at
least 87 percent of all residency overpayments.

SSA's ability to detect and deter residency violations is impeded by three
kinds of weaknesses. First, the agency relies heavily on self-reported
information from recipients to determine domestic residency, often without
independently verifying such information. Second, SSA makes insufficient
use of existing tools to detect violations, such as its "risk analysis"
system, redeterminations, and home visits. Finally, the agency has not
adequately pursued independent sources of information from other federal
agencies or private organizations to detect nonresidency of SSI
recipients. GAO recognizes that the SSI program is complex to administer,
and residency requirements are particularly difficult to enforce because
they can necessitate time-consuming, labor-intensive verification checks,
such as home visits. However, SSA has not employed a systematic,
comprehensive approach to this problem that would allow the agency to use
its available systems and procedures more efficiently and reduce the
program's exposure to additional violations.

GAO has made recommendations Top 15 Counties for SSI Residency
Overpayments (1997-2001)

to the Commissioner of Social Security that will allow the agency to make
optimal use of existing tools and new data sources to better detect
potential residency violators.

www.gao.gov/cgi-bin/getrpt?GAO-04-789T. To view the full report, including
the scope and methodology, click on the link above. For more information,
contact Robert E. Robertson (202) 512-7215 or [email protected].

Mr. Chairman and Members of the Subcommittee:

I am pleased to be here to discuss the Supplemental Security Income (SSI)
program. The Social Security Administration (SSA) administers the SSI
program, which is the nation's largest cash assistance program for the
poor. SSI provides financial assistance to people who are age 65 or older,
blind or disabled, and who have limited income and resources. In 2003,
about 6.9 million recipients were paid about $36 billion in SSI benefits.1
Benefit eligibility and payment amounts for SSI recipients are determined
by complex and often difficult to verify factors such as individual living
arrangements, including whether a person resides in the United States
(U.S.). Thus, the SSI program tends to be difficult to administer and
susceptible to overpayments.2 In recent years, SSA has identified a
general increase in the amount of annual overpayments made to recipients
who are not present in the U.S. as required by SSI program guidelines-a
problem we refer to as "residency violations."

My testimony today focuses on a report we issued in July 2003 in response
to a request from this subcommittee.3 You asked us to (1) determine what
is known about the extent to which SSI benefits are improperly paid to
individuals who are not present in the U.S. and (2) identify any
weaknesses in SSA's processes and policies that impede the agency's
ability to detect and deter residency violations.

In summary, SSA detected overpayments of $118 million for residency
violations between 1997 and 2001,4 but interviews with the Office of
Inspector General (OIG) and agency officials suggest that the agency only
detected a portion of the violations that occur each year, at least in
some parts of the country. The extent of violations appears to vary by
geographic region, with overpayments being more prevalent in several large
metropolitan areas in five states-California, Florida, Illinois, New
Jersey, and New York. We also found that recipients born outside the U.S.

1This figure includes both federal funds and state supplemental funds.

2In 2001, outstanding SSI debt and newly detected overpayments for the
year totaled $4.7 billion.

3See U.S. General Accounting Office, Supplemental Security Income: SSA
Could Enhance Its Ability to Detect Residency Violations, GAO-03-724
(Washington, D.C.: July 29, 2003).

4More recent data on overpayments due to residency violations were not
available at the time of this testimony.

accounted for at least 87 percent of all residency overpayments. Three
kinds of weaknesses have historically impeded SSA's ability to detect and
deter residency violations. First, to verify domestic residency, the
agency has often relied on self-reported information from recipients and
visual inspection of documents that can be easily manipulated, such as
rent receipts and letters from neighbors or clergy. Second, the agency has
historically made limited use of tools at its disposal to detect possible
violators, such as its risk analysis system to screen for high-risk cases
more likely to result in overpayments. Third, SSA has not adequately
pursued the use of independent, third-party data, such as emerging
immigration databases or recipient bank account information, to help
detect residency violations.

In response to our report recommendations, SSA indicated that it is
considering implementing several initiatives that may provide a more
complete picture of residency violations in the SSI program and improve
its ability to detect and prevent such violations in a more efficient,
timely manner. These include investigating the potential for obtaining
access to foreign automated teller machines to track banking transactions
over time, requesting assistance from state Medicaid fraud investigators
to help SSA perform more home visits to verify recipients' residence, and
investigating the potential of examining arrival/departure records
maintained by the Department of Homeland Security to identify recipients
who leave the country for more than 30 consecutive days. While it is too
early to assess how effective these initiatives may be, we support SSA's
commitment to studying this problem further and its willingness to explore
new data sources and improvements to existing processes as a way of
detecting potential violations in a more timely manner. Thus, we view
these initiatives as positive first steps. However, sustained management
attention to identifying and preventing residency violations will be
needed to further strengthen the integrity of the SSI program.

Background 	Individuals may apply for SSI benefits at any of about 1,300
SSA field offices. During the initial interview, SSA staff solicit
information on applicants' financial situation and the disability being
claimed. Applicants are required to report any information that may affect
their eligibility for benefits, such as income, resources, and their
living arrangements (including current residence). Similarly, once
individuals receive SSI benefits, they are required to report changes in
their address or residence to SSA in a timely manner. The Social Security
Act (Section 1614 (a)(1)(B)(i)) requires that an individual be a resident
of the U.S. to be eligible for SSI payments. SSA guidelines define a
resident of the U.S. as a

person who has established a dwelling in the U.S. with the intent to live
in the country. Section 1611(f) of the act also provides that no
individual is eligible for SSI payments for any month during all of which
the individual is outside the U.S. Recipients who fail to establish
residency in accordance with SSI program guidelines or do not report
absences of 30 days or more may be overpaid, and subject to monetary
penalties and administrative sanctions such as suspension of benefits.
Similarly, SSI recipients who become ineligible for SSI benefits because
they violate SSI residency guidelines may also be ineligible to receive
Medicaid benefits.

To a significant extent, SSA depends on program applicants and current
recipients to accurately report important eligibility information. To
verify this information, SSA may use computer matches to compare SSI
records against recipient information in records of third parties such as
other federal agencies. SSA also periodically conducts "redetermination"
reviews to verify important eligibility factors, such as income and
resources, to determine whether recipients remain eligible for benefits
after the initial assessment.

SSA detected overpayments of $118 million for residency violations between
1997 and 2001, but interviews with OIG and SSA officials suggest that the
agency detects only a portion of the violations that occur each year, at
least in some parts of the country. Special initiatives of limited
duration conducted by SSA and its OIG have uncovered additional residency
overpayments. According to our own analysis of SSA's data, residency
overpayments appear to vary by geographic region, with the majority of
overpayments having been detected in several large metropolitan areas.
Finally, we determined that most of the overpayments detected during this
period were attributable to recipients who were born outside the U.S.

  SSA Detected Overpayments of $118 Million for Residency Violations over 5
  Years, but More May Go Undetected

Residency Violations May be More Prevalent than SSA Has Detected

SSA detected an average of about 46,000 recipient residency violations
annually between 1997 and 2001, resulting in $118 million in overpayments.
While SSA's data show that less than 1 percent of all SSI recipients
violate residency requirements annually, SSA field staff and OIG officials
suggest that the problem may be more prevalent. For example, over the past
few years, SSA and its OIG have initiated a number of studies estimating
that residency violations in certain regions of the country may represent
as much as 26 percent of SSI cases in those areas. These local studies
were generally limited in duration and were performed within specific
geographic areas:

o  	A 1997 SSA and OIG joint study of SSI residency used home visits in
southern California to identify potential residency violations. The study
concluded that about 25 percent of SSI recipients in one field office were
living outside of the country. The study also determined that 47 percent
of SSI recipients from this field office could not be located at their
reported residence, an indication that they may be violating residency
requirements.

o  	A 1998 OIG eligibility study in El Paso, Texas, found that about 26
percent of recipients investigated were violating residency requirements.
This project identified about $3 million in residency overpayments.

o  	In 1998 and 1999, joint SSA/OIG studies examined 32,641 recipients in
New York and California who had not used their Medicaid benefits for at
least 1 year.5 Using redetermination reviews, these studies found that
1,281 recipients (about 4 percent) were living outside the U.S.6

Many Violations Are Geographically Concentrated

Our analysis of SSA's data showed that overpayments due to residency
violations are more prevalent in a number of large metropolitan areas. For
example, overpayments from violations detected in Los Angeles County,
California, represented 10.5 percent of the nation's SSI residency
overpayments between 1997 and 2001. Overall, we found that just 15
counties in 5 states-California, Florida, Illinois, New Jersey, and New
York-accounted for 54 percent of all residency overpayments detected by
SSA during this period. (See fig. 1.) In addition to Los Angeles County,
there were other counties with a significant percentage of SSI residency
overpayments: Queens County, N.Y. (5.2 percent); New York County, N.Y.
(5.0 percent); Kings County, N.Y. (4.8 percent); San Diego County, Calif.
(4.1 percent); and Bronx County, N.Y. (3.5 percent). Moreover, of
approximately 3,000 U.S. counties, 50 accounted for 77 percent of all
residency overpayments detected by SSA during this time. (See fig. 1.)

5The rationale for targeting these cases was that financially needy
individuals who were aged or disabled are likely to use Medicaid services
on a regular basis. Thus, SSI recipients who have not used Medicaid for
long periods of time may have left the U.S. or died.

6These studies considered the effect of only one potential indicator of
residency violations-Medicaid nonutilization.

      Figure 1: Top 15 Counties for SSI Residency Overpayments, 1997-2001

                                  Source: GAO.

Most Overpayments Were Made to Recipients Born Outside the U.S.

SSA's data also showed that individuals born outside the U.S. accounted
for at least 87 percent of all SSI residency overpayments between 1997 and
2001.7 Residency overpayments were most common among recipients who were
born in Latin America, the Caribbean, and South/Southeast Asia, but
included other areas as well, such as the Middle East. Recipients from the
Philippines accounted for the greatest amount of residency violations or
$24 million of all SSI residency overpayments during this period. SSA data
also showed that recipients from just 14 countries and 1 U.S. territory
accounted for about 73 percent of all residency overpayments during this
period. These include the Dominican Republic, (12.3 percent), Mexico (7.6
percent), Puerto Rico (7.5 percent), India (7.1 percent), and Iran (3.4
percent). (See fig. 2.)

7The percentage of total residency overpayments attributed to recipients
born outside of the U.S. may be higher than 87 percent because SSA could
not identify a specific country of birth for recipients that represent
about $10 million in SSI overpayments.

  Reliance on Self-Reported Information and Other Vulnerabilities Have Impeded
  SSA's Ability to Detect and Deter Violations

SSA's ability to detect and deter residency violations has been impeded by
three kinds of weaknesses. First, the agency has relied heavily on
selfreported information from recipients to determine domestic residency,
often without independently verifying such information. Second, SSA has
made insufficient use of its existing tools for identifying potential
violations, such as its risk analysis system to screen for high-risk
cases. SSA has also not made optimal use of redetermination reviews, home
visits, monetary penalties, and administrative sanctions to deter future
violations. Finally, the agency historically has not made adequate use of
independent data sources from other federal agencies or private
organizations to detect nonresidency of SSI recipients.

SSA Has Relied Heavily on Self-Reported Information That Can be
Manipulated

SSA has relied on self-reported information, such as documents and
statements from recipients, to establish proof of U.S. residency. Our
prior work has shown that about 77 percent8 of all payment errors in the
SSI program were attributable to recipients who do not comply with
reporting requirements.9 In our recent review, about half the SSA field
staff we interviewed reported that they relied on recipients to
self-report important information with respect to travel outside the U.S.
SSI program guidelines have generally directed SSA staff to accept
recipients' assertions concerning residency unless they have reason to
question the accuracy of their statements. If SSA field staff have reason
to believe that a recipient has been outside the country for more than 30
days, they may request additional documentation such as a plane ticket,
passport (or similar evidence which establishes date of entry into the
U.S.), or a signed statement from one or more U.S. residents such as
neighbors, clergy, or others who may have knowledge of the individual's
whereabouts. However, program guidelines do not require field staff to
perform any additional verification steps to establish recipients'
residency. 10

8This figure represents data from fiscal years 1991 through 1995.

9See U.S. General Accounting Office, Supplemental Security Income: Action
Needed on Long-Standing Problems Affecting Program Integrity,
GAO/HEHS-98-158 (Washington, D.C.: Sept. 14, 1998).

10SSI program guidance allows field staff to use home visits in selected
circumstances, such as in response to a report from a third party that a
recipient is outside the U.S. In addition, home visits may be employed if
a recipient fails to provide information requested by SSA staff, or if a
recipient does not respond to letters and/or telephone calls from staff
asking them to appear at the local office. However, program guidelines
give field office managers discretion in determining when to use home
visits and allow them to take into consideration factors such as the
safety of staff who perform such visits.

We also learned that some of the documents accepted by SSA as proof of
residence are subject to manipulation or forgery. For example, staff in
one field office noted that documents such as rent receipts can be
purchased from a local drugstore and easily forged. Other field staff said
that statements from neighbors could be falsified or manipulated to
support assertions that an individual has not traveled outside the
country. Field staff also reported that recipients may use multiple
passports in order to conceal extended stays outside the country. For
example, staff in two SSA regions we visited said that SSI recipients
sometimes use a foreign passport to exit and reenter the country while
maintaining a separate, "clean" U.S. passport for evidence of continuing
residency.

Given the agency's reliance on self-reported information, SSA field staff
often used their personal experience, judgment, and ad hoc interviewing
procedures to detect potential residency violations. In particular, SSA
field staff have looked for inconsistencies in recipient statements or a
recipient's inability to answer simple questions about where they live.
For example, recipients may be asked about the names of people living in
their household, or basic facts about their neighborhood such as the
location of a well-known landmark. Staff may also ask whether a recipient
owns property outside the U.S. Questionable or inconsistent answers to
such questions may result in requests to provide additional documentation.
However, effectively identifying residency violators has often depended on
the experience and persistence of individual staff.

Our review also found that the procedures for documenting recipients'
residency varied widely among the offices we visited, in particular, the
number and types of evidentiary documents requested by staff. While staff
in several offices reported that they often request only the most basic
documentation required by SSI program guidelines, staff in other offices
told us that they routinely ask for additional documentation for
recipients, such as a second passport or other travel documents to
determine whether the individual has been outside the country for more
than 30 days. While these steps are not required, some field staff
reported that they have been effective in identifying potential violators
and deterring future violations. SSA staff reported a number of reasons
for different documentation requirements such as variance in individual
office policies, personal preferences based on experience, time pressures
to complete cases, and the inability to effectively verify supplied
documentation.

SSA Has Not Fully Exploited Its Tools for Detecting and Deterring Program
Violations

SSA has not made optimal use of several tools that could be used to detect
residency violations. These include its "risk analysis system" for
screening cases more likely to result in overpayments, its
"redetermination reviews" of recipients' eligibility, and home visits to
verify recipients' whereabouts. SSA has used statistical risk analysis
techniques for many years in the SSI program to identify recipients who
are more likely to be overpaid due to excess income or resources. Since
SSA lacks adequate staff resources to conduct an annual review of every
recipient, it uses this technique to identify recipients who are most
likely to have a change in their eligibility

11

status or benefit amount.

Despite the proven effectiveness of its risk analysis system to help the
agency identify cases with the highest potential for overpayments, SSA has
not used this tool to specifically identify potential residency
violations. To determine whether it would be possible for SSA to more
effectively identify potential residency violators by using its existing
systems, we developed and tested a statistical model of factors possibly
associated with residency violations.12 Using this model as a screen, we
examined all recipients who were currently in violation of residency
requirements as of April 2003,13 and found that recipients born outside
the U.S.-noncitizens as well as naturalized citizens-were more than 40
times as likely to be violating residency requirements than were
native-born recipients. Similarly, recipients with prior residency
violations were about 10 times as likely to be current violators compared
with recipients who have no prior violations. We also found that
recipients who used post office boxes were somewhat more likely to be
receiving benefits outside the country than those without post office
boxes. Given the potential usefulness of this limited modeling
demonstration, it may be possible for SSA to expand and

11SSA's risk analysis system incorporates about 48 different
characteristics-or variables- to help the agency determine which
recipients will be selected for annual redetermination reviews. Recipients
identified as being at higher risk for overpayments are designated as High
Error Profile cases and may be subject to more frequent reviews that
entail personal contact with SSA field office staff. Those recipients
identified as being less likely to incur an overpayment are designated as
Medium or Low Error Profile and may only receive a redetermination
conducted by mail rather than in person. Some Low Error Profile cases are
only examined once every 6 years.

12The variables used in our model are not an exhaustive list of potential
variables that SSA could use in its risk analysis system. They represent
just a few of the characteristics that were frequently cited by prior
reviews as well as SSA and OIG staff as potentially good predictors of
residency violations.

13SSI recipients with residency violations were compared against
recipients with no violations.

refine its risk analysis system to better target potential violators. SSA
is studying the potential for refining its screening technique to improve
its effectiveness for identifying recipients at high risk for residency
violations.

Beyond the targeting problems we identified with SSA's risk analysis
system, we found that the agency was not using redeterminations as
efficiently as it could despite the fact that SSA's data and our prior
reviews have documented their effectiveness for verifying recipients'
eligibility.14 In particular, home visits were used infrequently during
redetermination reviews according to staff in a number of offices we
visited.

Those field offices that have used home visits as part of their
redetermination procedures have found them effective. About half of the
field offices we visited (9 of 17) employed home visits at least some of
the time to verify whether recipients actually live at the address they
report to SSA. For example, the SSA regional office in Dallas, Texas
contracted with a private investigation firm to conduct residency home
visits. Using these investigators, field offices within the region
performed 4,200 home visits that uncovered at least $2.1 million in
additional overpayments between October 1997 and January 2003. According
to SSA data, this project achieved a benefit-to-cost ratio of almost 8 to
1. Similarly, the California Department of Health Services has worked
cooperatively with SSA field offices in the San Diego area by conducting
residency home visits. Because Medicaid eligibility is often directly tied
to SSI eligibility, identifying residency violations may save funds from
both programs. Between October 2000 and September 2002, state Medicaid
investigators identified about 1,600 SSI recipients with residency
violations. In one instance, state investigators discovered an SSI
recipient who was using a residence in southern California as a mailing
address, while actually residing in Tijuana, Mexico, for at least 8 years.
In another case, state investigators found an SSI recipient using a post
office box in southern California as a mailing address, although the
recipient was in fact living in San Felipe, Mexico, since 1982. Because
the state provides these investigative services to SSA free of charge, it
is highly cost-effective. To

14SSA data show that, in 1998, refining the case selection methodology
increased estimated overpayment benefits-amounts detected and future
amounts prevented-by $99 million over the prior year. SSA officials have
estimated that conducting substantially more redetermination reviews would
yield hundreds of millions of dollars in additional overpayment benefits
annually. See U.S. General Accounting Office, Supplemental Security
Income: Progress Made in Detecting and Recovering Overpayments, but
Management Attention Should Continue, GAO-02-849, (Washington, D.C.: Sept.
6, 2002).

address this issue, SSA is currently exploring the potential for having
states assist in performing home visits using their Medicaid fraud
investigators. According to SSA, 27 states and the District of Columbia
have expressed an interest in assisting in this effort.

In terms of deterring future violations, we found that existing monetary
penalties and administrative sanctions are rarely, if ever, used in the
offices we visited.15 For example, about 72 percent of the field staff we
interviewed said that penalties or sanctions are not used in their
offices, or are only used occasionally. National data on SSA's use of
monetary penalties and administrative sanctions also suggest that these
tools are not routinely utilized for recipients who fail to report
important information that can affect their eligibility, including
absences from the country. In a recent report, we estimated that at most
about 3,500 recipients were penalized for reporting failures in fiscal
year 2001.16 Under the law, SSA may impose monetary penalties on
recipients who do not file timely reports about factors or events that can
affect their benefits. A penalty causes a reduction in 1 month's benefits.
Penalty amounts are $25 for a first occurrence, $50 for a second
occurrence, and $100 for the third and subsequent occurrences. The
penalties are meant to encourage recipients to file accurate and timely
information. However, a large number of staff we interviewed noted that
monetary penalties are too low to be an effective deterrent against future
residency violations.

The Foster Care Independence Act of 1999 (Pub. L. No. 106-169) gave SSA
authority to impose administrative sanctions on persons who misrepresent
material facts that they know, or should have known, were false or
misleading. In these circumstances, SSA may suspend benefits for up to 24
months. Despite having this authority, we found that benefit suspensions
are rarely if ever used by field staff for residency violators. In fact,
administrative sanctions were only imposed in 21 cases nationwide as of
January 2002.17 A substantial number of staff told us that they rarely use
sanctions because the process for imposing them is often time-consuming
and cumbersome. In addition, some staff reported that SSA management does
not encourage the use of penalties or sanctions to deter residency

15Prior GAO reports indicate that monetary penalties and administrative
sanctions may be underutilized in the SSI program. See GAO-02-849.

16See GAO-02-849.

17Ibid.

violations. SSA is currently evaluating its policies for imposing monetary
penalties and administrative sanctions.18

SSA Had Not Actively Pursued Third-Party Data Sources to Detect Potential
Violators

While SSA uses third-party information to verify certain aspects of
recipients' eligibility such as income, we found that the agency has
historically lacked adequate outside data sources to verify that
recipients are residents of the U.S.19 The agency currently receives
periodic paper reports from immigration officials on noncitizens who have
current and planned absences from the U.S. and sends them to the
appropriate SSA field offices for follow up. However, these procedures are
only effective for recipients who voluntarily report their absence to
immigration officials. Thus, SSA will remain limited in its ability to
independently verify the residency of SSI recipients who deliberately seek
to conceal extended periods outside the country. Over half of the SSA
managers and field staff we interviewed told us that access to automated
immigration data would help them to more accurately verify recipients'
residency. We have recommended that SSA consider using a new system called
the U.S. Visitor and Immigrant Status Indicator Technology system (US
VISIT) to verify some recipients' entry and exit from the country. It is
currently being used by the Department of Homeland Security and will
incorporate existing entry-exit databases. When fully implemented, this
system will provide a mechanism to monitor major ports of entry/exit in
the U.S., including land crossings, seaports, and airports. As noted
previously, SSA is examining the potential for obtaining access to the
system to identify SSI recipients who reside outside the U.S. for more
than 30 consecutive days.

SSA has also not fully utilized its authority to obtain independent data
from other sources such as financial institutions as a tool for detecting
potential residency violations. The Foster Care Independence Act of 1999
(FCIA) granted SSA new authority to verify recipients' financial accounts.
To implement this authority, SSA issued proposed regulations on its new
processes for accessing financial data in May 2002.20 In September 2003,
the agency issued its final regulations. SSA is testing processes to
access the records of financial institutions and credit bureaus to detect

18Ibid.

19For example, SSA routinely uses information from the Department of
Health and Human Service's National Directory of New Hires to verify SSI
recipients' income.

20See Access to Information Held by Financial Institutions, 67 Fed. Reg.
22021 (now codified at 20 C.F.R. pt. 416).

unreported income or resources of SSI applicant and recipients. However,
it is not clear whether SSA plans to use financial institution data more
broadly to detect potential residency violations. In particular, it may be
missing potentially helpful sources of information such as data on
recipients who conduct banking transactions outside the U.S. using ATMs.
As noted previously, a large proportion of the residency overpayments SSA
detected between 1997 and 2001 were tied to recipients who originated in
various countries in Latin America and South/Southeast Asia. However, SSA
currently has no way to identify recipients who withdraw SSI benefits from
ATMs outside the U.S. Information we obtained from a national financial
data vendor indicates that it is now possible for authorized users to
obtain detailed information on individuals' financial transactions from a
large number of national and international institutions. SSA may be able
to obtain data for recipients whose SSI benefits are direct-deposited into
a U.S. bank and then withdrawn from automated teller machines outside the
country over extended time periods. In response to our recommendation, SSA
has indicated that it would explore the feasibility of obtaining such
information to identify recipients who reside outside the U.S. for more
than 30 consecutive days.

Mr. Chairman, this concludes my prepared statement. I will be happy to
respond to any questions you or other Members of the Subcommittee may
have.

GAO Contacts and For information regarding this testimony, please contact
Robert E.

Robertson, Director, or Daniel Bertoni, Assistant Director,
Education,Staff Workforce, and Income Security Issues at (202) 512-7215.
Individuals Acknowledgments making contributions to this testimony include
Susan Bernstein, Jeff

Bernstein, Jeremy Cox, Sal Sorbello, Vanessa Taylor, Wendy Turenne, and

Shana Wallace.

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High Risk Program: Information on Selected High-Risk Areas. GAO/HR-97-30.
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High Risk Series: An Overview. GAO/HR-97-1. Washington, D.C.: February
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