    Immigration Benefits: Additional Controls and a Sanctions
    Strategy Could Enhance DHS's Ability to Control Benefit Fraud
    (10-MAR-06, GAO-06-259).

    In 2002, GAO reported that immigration benefit fraud was
    pervasive and significant and the approach to controlling it was
    fragmented. Experts believe that individuals ineligible for these
    benefits, including terrorists and criminals, could use
    fraudulent means to enter or remain in the U.S. You asked that
    GAO evaluate U.S. Citizenship and Immigration Service's (USCIS)
    anti-fraud efforts. This report addresses the questions: (1) What
    do available data and information indicate regarding the nature
    and extent of fraud? (2) What actions has USCIS taken to improve
    its ability to detect fraud? (3) What actions does the Department
    of Homeland Security (DHS) take to sanction those who commit
    fraud?
    -------------------------Indexing Terms-------------------------
    REPORTNUM:   GAO-06-259
        ACCNO:   A48758
      TITLE:     Immigration Benefits: Additional Controls and a Sanctions
    Strategy Could Enhance DHS's Ability to Control Benefit Fraud
         DATE:   03/10/2006
      SUBJECT:   Counterterrorism
    	     Criminals
    	     Forgery
    	     Fraud
    	     Immigration
    	     Internal controls
    	     Policy evaluation
    	     Risk assessment
    	     Sanctions
    	     Standards

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    GAO-06-259

         * Results in Brief
         * Background
         * Fraud Is A Serious Problem, But Its Full Extent Is Unknown
         * Although USCIS Has Taken Steps to promote Fraud Control, Add
              * Internal Control Standards and Other Guidance Provide Direct
              * Consistent with Internal Control Standards and Fraud Control
              * Additional Internal Controls and Use of Other Best Practices
                   * USCIS Has Not Adopted a Comprehensive Risk Management Approa
                   * USCIS Lacks a Mechanism to Ensure That Ongoing Monitoring Oc
                   * USCIS May Not Clearly Communicate the Importance of Fraud Co
                   * Adjudicators and FDNS Staff Lack Access to Important Informa
                   * DHS Lacks Performance Goals for USCIS's Antifraud Efforts
         * Most Benefit Fraud Is Not Criminally Prosecuted, but DHS Doe
         * Conclusions
         * Recommendations for Executive Action
         * Agency Comments and Our Evaluation
         * GAO Contact
         * Staff Acknowledgements
         * GAO's Mission
         * Obtaining Copies of GAO Reports and Testimony
              * Order by Mail or Phone
         * To Report Fraud, Waste, and Abuse in Federal Programs
         * Congressional Relations
         * Public Affairs

                     United States Government Accountability Office

    Report to Congressional Requesters

    GAO

    March 2006

    IMMIGRATION BENEFITS

      Additional Controls and a Sanctions Strategy Could Enhance DHS's Ability to
                                 Control Benefit Fraud

    GAO-06-259

    IMMIGRATION BENEFITS

    Additional Controls and a Sanctions Strategy Could Enhance DHS's Ability
    to Control Benefit Fraud

      What GAO Found

    Although the full extent of benefit fraud is unknown, available evidence
    suggests that it is a serious problem. Several high-profile immigration
    benefit fraud cases shed light on aspects of its nature-particularly that
    it is accomplished by submitting fraudulent documents and can be
    facilitated by white collar and other criminals, with the potential for
    large profits. USCIS staff denied about 20,000 applications for fraud in
    fiscal year 2005.

    USCIS has established a focal point for immigration fraud, outlined a
    fraud control strategy that relies on the use of automation to detect
    fraud, and is performing risk assessments to identify the extent and
    nature of fraud for certain benefits. However, USCIS has not implemented
    important aspects of internal control standards established by GAO and
    fraud control best practices identified by leading audit
    organizations-particularly a comprehensive risk management approach, a
    mechanism to ensure ongoing monitoring during the course of normal
    activities, clear communication regarding how to balance multiple
    objectives, mechanisms to help ensure that staff have access to key
    information, and performance goals for fraud prevention.

    DHS does not have a strategy for sanctioning fraud. Best practices advise
    that a credible sanctions program, which includes a mechanism for
    evaluating effectiveness, is an integral part of fraud control. Because
    most immigration benefit fraud is not prosecuted criminally, the principal
    means of sanctioning it would be administrative penalties. Although
    immigration law gives DHS the authority to levy administrative penalties,
    the component of DHS that administers them does not consider them to be
    cost-effective and does not routinely impose them. However, DHS has not
    evaluated the costs and benefits of sanctions, including the value of
    potential deterrence. Without a credible sanctions program, DHS's efforts
    to deter fraud may be less effective, when applicants perceive little
    threat of punishment.

             Minimizing Immigration Benefit Fraud through Internal Controls

    Source: GAO.

    United States Government Accountability Office

    Contents

      Letter 1

    Results in Brief 4 Background 8 Fraud Is A Serious Problem, But Its Full
    Extent Is Unknown 13 Although USCIS Has Taken Steps to promote Fraud
    Control,

    Additional Controls and Best Practices Could Improve Its Ability

    to Detect Fraud 19 Most Benefit Fraud Is Not Criminally Prosecuted, but
    DHS Does

    Not Have an Administrative Sanctions Program 35 Conclusions 38
    Recommendations for Executive Action 40 Agency Comments and Our Evaluation
    41

    Appendix I Scope and Methodology

    Appendix II Comments from the Department of Homeland Security

    Appendix III GAO Contact and Staff Acknowledgments

      Figures

    Figure 1: USCIS Applications Completed in Fiscal Year 2005 9 Figure 2:
    Immigration Benefit Fraud Detection and Referral

    Process 12 Figure 3: Internal Control Environment 20

    Abbreviations

    AICPA                   American Institute of Certified Public Accountants
    BFU              Benefit Fraud Unit
    CBP              Customs and Border Protection
    CFR              Code of Federal Regulations
    CIS              Citizenship and Immigration Services
    DHS              Department of Homeland Security
    DOL              Department of Labor
    FDNS             Office of Fraud Detection and National Security
    FDU              Fraud Detection Unit
    ICE              Immigration and Customs Enforcement
    INA              Immigration and Nationality Act
    INS              Immigration and Naturalization Service
    NAO              National Audit Office of the United Kingdom
    PAS              Performance Analysis System
    TECS             Treasury Enforcement Communication System
    USCIS                   United States Citizenship and Immigration Services

    This is a work of the U.S. government and is not subject to copyright
    protection in the United States. It may be reproduced and distributed in
    its entirety without further permission from GAO. However, because this
    work may contain copyrighted images or other material, permission from the
    copyright holder may be necessary if you wish to reproduce this material
    separately.

    United States Government Accountability Office Washington, DC 20548

    March 10, 2006

    The Honorable John N. Hostettler Chairman Subcommittee on Immigration,
    Border Security, and Claims Committee on the Judiciary House of
    Representatives

    The Honorable Charles E. Grassley Chairman Committee on Finance United
    States Senate

    In fiscal year 2005, over 6 million applications were filed by those
    seeking an immigration benefit-the ability of an alien to live and in some
    cases work in the United States either permanently or on a temporary
    basis. Most immigration benefits can be classified into two major
    categories- family-based and employment-based. Family-based applications
    are filed by U.S. citizens or permanent resident aliens to establish their
    relationships to certain alien relatives such as a spouse, parent, or
    minor child who wish to immigrate to the United States. Employment-based
    applications include applications filed by employers for aliens to come to
    the United States temporarily to work or receive training or for alien
    workers to work permanently in the United States. Other immigration
    benefits include granting citizenship to resident aliens (called
    naturalization), offering asylum to aliens who fear persecution in their
    home countries, and authorizing international students to study in the
    United States.

    U.S. Citizenship and Immigration Services (USCIS) within the Department of
    Homeland Security (DHS) is the agency primarily responsible for processing
    applications for immigration benefits. The former Immigration and
    Naturalization Service (INS) previously had this responsibility, which
    USCIS assumed when DHS was created in March 2003. USCIS's staff of
    adjudicators process immigration benefits in 4 service centers and 33
    district offices around the country. In some cases, applicants may try to
    obtain a benefit illegally through fraud. 1 USCIS adjudicators who suspect
    fraud are to refer suspicious applications and supporting evidence to
    USCIS's Office of Fraud Detection and National Security (FDNS), created in
    2003. FDNS staff are responsible for reviewing these potential fraud cases
    and determining whether to forward them to DHS's Immigration and Customs
    Enforcement (ICE)-which, among other things, is responsible for
    investigating violations of immigration law, including immigration benefit
    fraud. ICE may or may not decide to initiate a criminal investigation,
    depending on the facts in the referral and on workloads and priorities of
    its field offices.

    DHS, terrorism experts, and federal law enforcement officials familiar
    with immigration benefit fraud believe that individuals ineligible for
    immigration benefits, including terrorists and criminals, could use
    fraudulent means to enter or remain in the United States. In 2002, we
    reported that immigration benefit fraud was pervasive and significant and
    that INS's approach to immigration benefit fraud was fragmented and
    unfocused. 2 A 2005 study by a former 9/11 Commission counsel found that
    of the 94 foreign-born terrorists known to operate in the United States
    between the early 1990s and 2004, 59 or two-thirds committed immigration
    fraud including 6 of the September 11th hijackers. 3 To determine what
    actions have been taken since our 2002 report to address immigration
    benefit fraud, you asked that we evaluate current anti-fraud efforts. This
    report addresses the following questions:

    (1)
               What do available data and information indicate regarding the
               nature and extent of immigration benefit fraud?

    (2)
               What actions has USCIS taken to improve its ability to detect
               immigration benefit fraud?

    1

    Immigration benefit fraud refers to the willful misrepresentation of
    material fact to gain an immigration benefit. It is often facilitated by
    document fraud (use of forged, counterfeit, altered or falsely made
    documents) and identity fraud (fraudulent use of valid documents or
    information belonging to others).

    2

    GAO, Immigration Benefit Fraud: Focused Approach Is Needed to Address
    Problems, GAO-02-66 ( Washington, D.C.: Jan. 31, 2002).

    3

    See also testimony of Janice Kephart, former counsel, The National
    Commission on Terrorist Attacks Upon the United States, before the
    Subcommittee on Immigration, Border Security, and Citizenship and the
    Subcommittee on Terrorism, Technology, and Homeland Security, Senate
    Judiciary Committee, Mar. 14, 2005.

    (3) What actions does DHS take to sanction those who commit benefit fraud?

    To address these questions, we interviewed responsible officials at and
    reviewed relevant documentation obtained from DHS and the Departments of
    State, Justice, and Labor. Regarding the nature and extent of immigration
    benefit fraud, we analyzed USCIS management data contained in its
    Performance Analysis System (PAS), results from two fraud assessments
    USCIS had completed before December 2005, information reported by DHS and
    the U.S. Attorneys Offices based on investigations and prosecutions of
    immigration benefit fraud, and information in fraud bulletins prepared by
    one USCIS Service Center. We evaluated the methodology used in USCIS's
    fraud assessments and determined that it provided a reasonable basis for
    projecting the frequency with which fraud was committed within the time
    period from which the samples were drawn. We assessed the data derived
    from PAS and determined that these data were sufficiently reliable for the
    purposes of this review. Because we selected investigations and
    prosecutions to review based upon information that was available, the
    information obtained from them is not necessarily representative or
    exhaustive of all immigration benefits cases nationwide. Similarly,
    information contained in the fraud bulletins is not necessarily
    representative of immigration benefit fraud nationwide. To determine how
    USCIS detects fraud during the adjudications process and to evaluate these
    efforts, we interviewed USCIS headquarters officials and USCIS's FDNS
    staff. We also interviewed 59 adjudicators at the 4 USCIS Service Centers
    and 2 USCIS district offices with responsibility for and familiarity with
    adjudicating different types of applications in a group setting, which
    allowed us to identify points of consensus among these adjudicators. In
    addition we interviewed ICE Office of Investigations officials from four
    ICE field offices. As we did not select probability samples of
    adjudicators and ICE Office of Investigations staff to interview, the
    results of these interviews may not be projected to the views of all USCIS
    adjudicators and ICE Office of Investigations field staff nationwide.
    Further, we compared the practices in place to the Standards for Internal
    Control in the Federal Government 4 and to guidance from internationally
    recognized, leading organizations in fraud control, including the American
    Institute of Certified Public Accountants and the United Kingdom's
    National Audit Office. To determine what measures

    GAO, Standards for Internal Control in the Federal Government,
    GAO/AMID-00-21.3.1 (Washington, D.C.: November 1999).

        Page 3 GAO-06-259 Immigration Benefits

                                    Results in Brief

    DHS has taken to sanction those who commit immigration fraud, we
    interviewed knowledgeable officials at USCIS and ICE, examined fraud
    investigation and prosecution statistics, and analyzed USCIS statistics
    about the amount of fraud identified by its adjudicators. We conducted our
    work from October 2004 to December 2005 in accordance with generally
    accepted government auditing standards. Appendix I presents more details
    about our objectives, scope, and methodology.

    Our review of several high-profile immigration benefit fraud cases sheds
    light on some aspects of the nature of immigration benefit fraud-
    particularly that it is accomplished by submitting fraudulent documents,
    that it can be facilitated by white collar and other criminals, and that
    it has the potential to result in large profits. Although the full extent
    of benefit fraud is not known, available evidence suggests that it is an
    ongoing and serious problem. Fraudulent documents submitted included but
    were not limited to marriage and birth certificates, financial statements,
    business plans, organizational charts, fictitious employee resumes, and
    college transcripts. White-collar and other criminals can facilitate
    immigration benefit fraud. Individuals who pose a threat to national
    security and public safety may seek to enter the United States by
    fraudulently obtaining immigration benefits. Moreover, those facilitating
    immigration benefit fraud, in some cases, have reaped large profits from
    aliens willing to pay thousands of dollars to fraudulently obtain an
    immigration benefit. In fiscal year 2005, USCIS denied about 20,000
    applications due to fraud. In addition, in 2005, USCIS's new fraud
    detection office conducted the first two in a series of planned fraud
    assessments-reviews of applications for religious worker and replacement
    permanent resident card benefits. Based on the results of the completed
    religious worker assessment, which estimated that 33 percent of all
    religious worker applications were potentially fraudulent, we project that
    about 660 applications-one-third of religious worker applications
    submitted over a 6-month period in 2004-may have contained fraudulent
    information. Some findings of the religious worker assessment and facts
    uncovered during criminal investigations and prosecutions demonstrate that
    USCIS adjudicators do not always detect fraud during the adjudications
    process, thus allowing applicants to receive benefits for which they were
    not eligible. Moreover, USCIS's policy of issuing temporary work
    authorization within 90 days to those applicants waiting for their
    applications for permanent residency to be decided, although intended to
    allow bonafide applicants to work as soon as possible, can be exploited by
    aliens filing fraudulent applications with the intent of receiving the
    temporary work authorization for which they would otherwise be ineligible.
    These aliens can then use the temporary work authorization to obtain other
    official documents, such as drivers' licenses. Based on an estimate from
    the DHS Office of Immigration Statistics that about 85 percent of
    applicants who apply for permanent residency also apply for temporary work
    authorization, the Citizenship and Immigration Services Ombudsman contends
    that many aliens who filed a fraudulent claim for permanent residency may
    have received temporary work authorization.

    To help it detect immigration benefit fraud, USCIS established FDNS as its
    focal point for dealing with immigration benefit fraud, outlined a
    strategy for detecting immigration benefit fraud, and is undertaking a
    series of risk assessments to identify the extent and nature of fraud for
    certain immigration benefits. However, USCIS has not yet implemented some
    aspects of internal control standards established by GAO and fraud control
    best practices identified by leading audit organizations that could
    further enhance its ability to detect fraud. Specifically, USCIS's new
    fraud detection office is in the initial stages of implementing a fraud
    assessment program, which examines the extent and nature of fraud
    associated with the immigration category being assessed. However, this
    program, as currently implemented, does not provide a basis for the type
    of comprehensive risk analysis we advocate. First, USCIS current
    assessment plan does not include risk assessment of the majority of major
    immigration benefit categories-for example, temporary work authorization.
    Additionally, it focuses primarily on determining the fraud rate for
    selected immigration applications and identifying procedural
    vulnerabilities, for example, not routinely verifying the existence of
    churches associated with religious work applications. It does not draw on
    all available sources of strategic threat information to assess threats,
    such as ICE's Office of Intelligence, nor does it assess the consequences
    of granting a benefit to the wrong person-for example some benefits
    facilitate access to critical infrastructure while others do not. More
    comprehensive information about vulnerabilities, threats, and consequences
    as part of its fraud assessments would allow USCIS to identify those
    benefits that represent the highest risk and practice riskbased decision
    making in its efforts to balance fraud detection with other organizational
    priorities like reducing backlogs and improving customer service. In
    addition, USCIS also lacks a mechanism to help ensure that information
    gathered during the course of its normal operations and those of related
    operations-including criminal investigations and prosecutions-inform
    decisions about whether and what actions, including changes to policies,
    procedures, or programmatic activities, might improve the ability to
    detect fraud. Moreover, adjudicators we interviewed reported that
    communication from management did not clearly communicate to them the
    importance of fraud control; rather, it emphasized meeting production
    goals, designed to reduce the backlog of applications, almost exclusively.
    These adjudicators shared, for example, memos from different parts of the
    agency, which they told us sent conflicting messages about how they were
    to balance, during the course of their duties, fraud-prevention objectives
    with service-related objectives. USCIS headquarters operations management
    told us that the adjudications operations is a "high-pressure" production
    environment and that they are seeking to increase production, but it was
    not their intention that this should come at the expense of making
    incorrect adjudication decisions. Also, our interviews with adjudicators
    indicated that they have limited access to some tools that could support
    their fraud detection ability such as external databases for verifying
    applicant information. Interviews with USCIS staff also indicated that
    adjudicators may not always receive relevant information that could
    support their efforts to detect fraud, and although some information is
    provided, it is not always provided in a form that adjudicators can
    reasonably manage as, for example, in an electronic database. Finally,
    USCIS has not established performance goals- measures and targets-to
    assess its benefit fraud activities.

    DHS does not have a strategy for sanctioning fraud or for evaluating the
    effectiveness of sanctions. Best practice guidance issued by the United
    Kingdom's National Audit Office, for example, suggests that a strategy for
    sanctioning fraud, along with a mechanism for evaluating the effectiveness
    of sanctions is central to a good fraud control environment. Data provided
    by USCIS indicates that in fiscal year 2005 most immigration fraud
    detected by USCIS did not result in ICE criminal investigations and
    subsequent prosecutions. Since most fraud is not criminally prosecuted,
    the principal means of sanctioning it would be administrative penalties.
    The Immigration and Nationality Act does provide the authority to levy
    administrative penalties; however, DHS does not currently use this
    authority. This is largely because a 1998 federal court ruling enjoined
    INS from implementing certain administrative penalties for document fraud
    until it revised certain forms to provide adequate notice to aliens of the
    immigration consequences of waiving the opportunity to challenge document
    fraud fines. Although DHS has not conducted a formal costbenefit analysis,
    according to ICE officials responsible for pursuing administrative
    penalties, these penalties are not cost-effective because the fines are
    less than the costs to impose them when a hearing is requested.
    Accordingly, DHS has not made updating the forms to allow sanctions to be
    administered in compliance with the court ruling a priority. Nevertheless,
    according to USCIS officials, an effective administrative sanctions
    program is important to its fraud deterrence efforts. The lack of a clear
    strategy for how and when to punish fraud perpetrators, which considers
    the nonfinancial benefit of deterrence and includes a mechanism for
    evaluating effectiveness, limits DHS's ability to project a convincing
    message that those who commit fraud face a credible threat of punishment
    in one form or another.

    In order to enhance USCIS's ability to detect immigration benefit fraud,
    we are recommending that the Secretary of Homeland Security direct the
    Director of USCIS to adopt additional internal controls and best practices
    to strengthen USCIS's fraud control environment, particularly by (1)
    expanding the scope of its current fraud assessment program and using a
    more comprehensive risk management approach; (2) establishing a mechanism
    to ensure that information uncovered during USCIS's and related agencies'
    normal operations feeds back into evaluations of USCIS's policies,
    procedures, and operations; (3) clearly communicating to adjudications
    staff the importance of both fraud prevention-related and service-related
    objectives, and how these objectives are to be balanced by adjudicators as
    they carry out their duties; (4) providing USCIS staff with access to
    information and tools from relevant internal and external sources; and (5)
    establishing outcome and output based performance goals that reflect the
    status of fraud control efforts. In addition, in order to enhance DHS's
    ability to sanction immigration benefit fraud, we recommend that the
    Secretary of Homeland Security direct the Director of USCIS and the
    Assistant Secretary of ICE to develop a strategy for sanctioning
    immigration benefit fraud that takes into account the value of deterrence
    and establishes a mechanism for evaluating effectiveness.

    We presented a draft of this report to DHS and the Departments of State,
    Justice, and Labor. State, Justice, and Labor had no comments on our
    report. DHS stated that our report generally provided a good overview of
    the complexities associated with pursing immigration benefit fraud and the
    need to have a program in place that proactively assesses vulnerabilities
    within the myriad of immigration processes. However, DHS stated that our
    report did not fully portray USCIS's efforts to address immigration
    benefit fraud and provided other examples of efforts USCIS has undertaken
    or plans to undertake. Where appropriate, we revised the draft report to
    recognize these additional efforts by USCIS. DHS generally agreed with and
    plans to take action to implement four of our six recommendations and
    cited actions it has already taken to address our other two
    recommendations. DHS agreed on the need to expand its fraud assessment
    program, provide USCIS staff access to information from internal and
    external sources, and establish outcome and output performance based
    goals. DHS agreed that goals were needed but did not

                                       Background

    specify what action(s) it was planning to take. DHS agreed to study the
    costs and benefits of an administrative sanctions program. DHS stated that
    a mechanism to ensure that information uncovered during USCIS's and
    related agencies normal operations feeds back into evaluations of USCIS's
    policies, procedures, and operations already exists. DHS cited examples of
    how FDNS shares information with other agencies, participates in
    interagency anti-fraud effort efforts, and has recommended changes to how
    USCIS adjudicates religious worker applications as evidence that such
    feedback takes place. Although these are all positive efforts, USCIS does
    not yet have policies and procedures that specify how information about
    fraud vulnerabilities uncovered during the course of normal operations- by
    USCIS and related agencies-is to be gathered-from which internal and
    external sources-and the process for evaluating this information and
    making decisions about appropriate corrective actions. Therefore, we
    continue to believe that USCIS needs to institutionalize through policies
    and procedures a feedback mechanism. With respect to communicating clearly
    the importance of USCIS's fraud prevention objectives, DHS stated that
    USCIS leadership clearly advocates balancing objectives related to timely
    and quality processing of immigration benefits, and cited the creation of
    FDNS as evidence that USCIS senior leadership believes national security
    and fraud detection are a high priority. However, our interviews with
    adjudicators indicate that this message may not be reaching USCIS
    adjudications staff. DHS disagreed with our recommendation that USCIS and
    ICE establish a mechanism for the sharing of information related to the
    status and outcomes of USCIS fraud referrals to ICE. DHS provided us a
    February 2006 memorandum of agreement between ICE and USCIS that
    establishes a mechanism for the sharing of information related to the
    status and outcomes of fraud referrals; therefore, we withdrew this
    recommendation.

    USCIS is responsible for processing millions of immigration benefit
    applications received each year for various types of immigration benefits,
    determining whether applicants are eligible to receive immigration
    benefits, and detecting suspicious information and evidence to refer for
    fraud investigation and possible sanctioning by other components or
    agencies. USCIS processes applications for about 50 types of immigration
    benefits. In fiscal year 2005, USCIS received about 6.3 million
    applications and adjudicated about 7.5 million applications. Figure 1
    shows the percentage of applications completed by type of application in
    fiscal year 2005.

    Figure 1: USCIS Applications Completed in Fiscal Year 2005

    Employment authorization

    Nonimmigrant worker

    Travel document

    Naturalization

    Permanent resident

    Spouse & family

    Replacement/renewal of permanent resident card

    Other application types

    Source: GAO analysis of USCIS Performance AnalysisSystem (PAS) data.

    To process these immigration benefit applications, in fiscal year 2005
    USCIS had a staff of about 3,000 permanent adjudicators located in 4
    service centers, where most applications are processed, and 33 district
    offices. 5 In fiscal year 2004, for example, service centers adjudicated
    about 67 percent of all applications, and districts about 33 percent. In
    general, service centers adjudicate applications that do not require an
    interview with the applicant, using the evidence submitted with the
    applications. District offices generally adjudicate applications where
    USCIS requires an interview with the applicant (e.g., naturalization).
    USCIS also has eight offices that process applications for asylum in the
    United States. In fiscal year 2005, USCIS's budget amounted to just under
    $1.8 billion, of which about $1.6 billion was expected from service fees
    and $160 million from congressionally appropriated funds.

    USCIS also employed an additional 1,475 adjudicators on a temporary basis
    to support its backlog reductions efforts.

    Page 9 GAO-06-259 Immigration Benefits

    In fiscal year 2004, USCIS had a backlog of several million applications
    and has developed a plan to eliminate it by the end of fiscal year 2006. 6
    In June 2004, USCIS reported that it would have to increase production by
    about 20 percent to achieve its goal of adjudicating all applications
    within 6 months or less by the end of fiscal year 2005. At that time, it
    estimated that it would have to increase current annual processing from
    about 6 million to 7.2 million applications. Since USCIS did not plan for
    further increases in staffing levels, reaching its backlog goal would
    require some reduction in average application processing times, overtime
    hours, and adjudicator reassignments.

    With the creation of DHS in 2003, the immigration services and enforcement
    functions of the former INS transitioned to different organizations within
    DHS. USCIS assumed the immigration benefit functions and ICE assumed INS's
    investigative and detention and removal of aliens functions. Within ICE's
    Office of Investigations, the Identity and Benefit Fraud unit now conducts
    immigration benefit fraud criminal investigations and ICE's Office of
    Detention and Removal Operations is responsible for identifying and
    removing aliens illegally in the United States.

    Because the immigration service and enforcement functions are now handled
    by separate DHS components, these components created two new units to,
    among other things, help coordinate the referral of suspected immigration
    benefit fraud uncovered by adjudicators to ICE's Office of Investigations.
    First, USCIS created FDNS in 2003 to, among other things, receive fraud
    leads from adjudicators and determine which leads should be referred to
    ICE's Office of Investigations. To accomplish this task, FDNS has Fraud
    Detection Units (FDU) at all four USCIS service centers and the National
    Benefits Center. 7 When fraud is suspected, the applications are to be
    referred FDUs. The FDUs, comprised of Intelligence Research Specialists
    and assistants, are responsible for further developing suspected
    immigration fraud referrals to decide which leads should be referred to
    ICE for possible investigation. FDU staff are also to refer to

    6

    See GAO, Immigration Benefits: Improvements Needed to Address Backlogs and
    Ensure Quality of Adjudications, GAO-06-20 (Washington D.C.: November
    2005).

    7

    The National Benefits Center serves as a hub for applications adjudicated
    at USCIS field offices. Among other things, the center performs initial
    evidence review and conducts background checks before sending the file to
    the appropriate district office for adjudication.

    Page 10 GAO-06-259 Immigration Benefits

    ICE or other federal agencies applicants who may pose a threat to national
    security or public safety or who are potentially deportable. FDUs are
    responsible for following up on potential national security risks
    identified during background checks of immigration benefit applicants.
    FDUs also perform intelligence analysis to identify immigration fraud
    patterns and major fraud schemes. In addition to establishing FDUs, in
    January 2005 FDNS assigned 100 new Immigration Officers to USCIS district
    offices, service centers, and asylum offices to work directly with
    adjudicators to handle fraud referrals and conduct limited field
    inquiries. Second, ICE's Office of Investigations created four new Benefit
    Fraud Units (BFU) in Vermont, Texas, Nebraska, and California located
    either at or near the four USCIS service centers. The ICE BFUs are
    responsible for reviewing, assessing, developing, and when appropriate,
    referring to ICE field offices for possible investigation immigration
    fraud leads and other public safety leads received from the FDUs and
    elsewhere. Specifically, the ICE BFUs are intended to identify those
    referrals that they believe warrant investigation, such as organizations
    and facilitators engaged in large-scale schemes or individuals who pose a
    threat to national security or public safety, and refer them to ICE field
    offices. In turn, ICE field offices will investigate and refer those cases
    they believe warrant prosecution to the

    U.S. Attorneys Offices. Figure 2 illustrates the typical immigration
    benefit fraud referral and coordination process.

    Figure 2: Immigration Benefit Fraud Detection and Referral Process

        Immigration Benefit Fraud Detection & Referral Process

    DHS DOJ

    Accepts fraud referralsbased on individual SAC prioritiesand overall ICE
    goals

    Performs field investigation and enforcement action

    Source: USCIS.

    The Homeland Security Act of 2002 created the office of the Citizenship
    and Immigration Services Ombudsman. The ombudsman's primary function is
    to: assist individuals and employers in resolving problems with USCIS;
    identify areas in which individuals and employers have problems in dealing
    with USCIS; and propose changes in the administrative practices of USCIS
    in an effort to mitigate problems. The ombudsman has issued two annual
    reports that have highlighted issues related to prolonged processing
    times, limited case status information, immigration benefit fraud,
    insufficient standardization in processing, and inadequate information
    technology and facilities.

    Other federal agencies also play important roles in the immigration
    benefit application process. The Department of State is responsible for
    approving

      Fraud Is A Serious Problem, But Its Full Extent Is Unknown

    and issuing a visa allowing an alien to travel to the United States. The
    Department of Labor's (DOL) Division of Foreign Labor Certification
    provides national leadership and policy guidance to carry out the
    responsibilities of the Secretary of Labor under the Immigration and
    Nationality Act (INA) concerning foreign workers seeking admission to the
    United States for employment. DOL provides certifications for foreign
    workers to work in the United States, on a permanent or temporary basis,
    when there are insufficient qualified U.S. workers available to perform
    the work at wages that meet or exceed the prevailing wage for the
    occupation in the area of intended employment. The DOL Office of the
    Inspector General's Office of Labor Racketeering and Fraud Investigations
    is responsible for investigating fraud related to these labor
    certifications.

    Fraudulent schemes used in several high-profile immigration benefit fraud
    cases sheds light on some aspects of the nature of immigration benefit
    fraud-particularly that it is accomplished by submitting fraudulent
    documents, that it can be committed by organized white-collar and other
    criminals, and that it has the potential to result in large profits for
    these criminals. The benefit fraud cases we reviewed involved individuals
    attempting to obtain benefits for which they were not eligible by
    submitting fraudulent documents or making false claims as evidence to
    support their applications. Fraudulent documents submitted included but
    were not limited to birth and marriage certificates, tax returns,
    financial statements, business plans, organizational charts, fictitious
    employee resumes, and college transcripts. For example, in what ICE
    characterized as one of the largest marriage fraud investigations ever
    undertaken, 44 individuals were indicted in November 2005 for their
    alleged role in an elaborate scheme to obtain fraudulent immigrant visas
    for hundreds of Chinese and Vietnamese nationals. According to a USCIS
    fraud bulletin, this scheme may have been ongoing for 10 years. Another
    major investigation revealed evidence that an attorney had filed about 350
    applications on behalf of aliens seeking permanent employment as religious
    workers at religious institutions in the United States. Investigators
    found evidence that most of these aliens were unskilled laborers who were
    not pastors or other religious workers and had little or no previous
    affiliation with the religious institution. According to this
    investigation, some religious institutions appeared to specialize in
    obtaining legal status for aliens in the country who were not eligible for
    religious worker immigration benefits. In another investigation involving
    at least 2,800 apparently fraudulent marriage and fiancee applications
    identified in 2002 and investigated through 2004, a U.S. citizen appeared
    to have submitted multiple applications with as many as 11 different
    spouses.

    One USCIS Service Center prepared fraud bulletins using information from
    various State Department Consular posts overseas describing immigration
    fraud uncovered by these posts. Our analysis of the bulletins issued from
    July 2004 through December 2004 prepared by USCIS's California Service
    Center revealed that aliens from 23 different countries were believed to
    have sought a variety of immigration benefits fraudulently. For example,
    individuals apparently sought to enter the United States through fraud by
    falsely claiming they were: (1) legitimately married to or a fiance of a
    U.S. citizen; (2) a religious worker; (3) a performer in an entertainment
    group;

    (4)
               a person with extraordinary abilities, such as an artist, race car
               driver, or award winning photographer; (5) an executive with a
               foreign company;

    (6)
               a child or other relative of a citizen or permanent resident; or
               (7) a domestic employee of an alien legally in the United States,
               such as a diplomat or business executive. According to one of the
               bulletins, in one case State Department consular officers
               suspected illegal aliens were entering the United States under the
               guise of membership in a band. According to another bulletin, two
               individuals were suspected of smuggling children into the United
               States. In this case, the alleged parents submitted a
               non-immigrant visa application for their "daughter," and provided
               a fraudulent birth certificate and passport for her. The "parents"
               eventually admitted to taking children to the United States as
               their own to reunite them with their illegally working family
               members.

    Some individuals seeking immigration benefits pose a threat to national
    security and public safety, and white collar and other criminals sometimes
    facilitate immigration benefit fraud. For example, according to FDNS, each
    year about 5,200 immigration benefit applicants are identified as
    potential national security risks, because their personal information
    matches information contained in U.S. Customs and Border Protection's
    Interagency Border Inspection System, a database of immigration law
    violators and people of national security interest. Additionally,
    according to federal prosecutors, immigration benefit fraud may involve
    other criminal activity, such as income tax evasion, money laundering,
    production of fraudulent documents, and conspiracy. Also, organized crime
    groups have used sophisticated immigration fraud schemes, such as creating
    shell companies, to bring in aliens ostensibly as employees of these
    companies. In addition, a number of individuals linked to a hostile
    foreign power's intelligence service were found to have been employed as
    temporary alien workers on military research.

    Investigations have revealed that perpetrating fraud on behalf of aliens
    can be a profitable enterprise. For instance, in 2003 and 2004, one USCIS
    service center identified about 2,800 apparently fraudulent marriage
    applications between low-income U.S. citizens and foreign nationals from
    an Asian country. The U.S. citizens appeared to have been paid between
    $5,000 and $10,000 for participating in the marriage fraud scheme. In
    another example from an investigation by DOL's Inspector General, to
    fraudulently obtain the labor certifications needed to work in the United
    States, at least 900 aliens allegedly paid a recruitment firm an average
    of $35,000, with some aliens paying as much as $90,000, resulting in at
    least $31 million in revenue for this firm. In one of the largest labor
    certification fraud schemes ever uncovered, federal investigators found
    evidence that a prominent immigration attorney in the Washington, D.C.,
    area submitted at least 1,436 and perhaps as many as 2,700 fraudulent
    employment applications between 1998 and 2002. According to the sworn
    testimony of a DOL special agent, this attorney and his associates are
    alleged to have made at least $11.4 million for the 1,400 applications
    that the agent reviewed, in all of which he found evidence of fraud, and
    perhaps as much as $21.6 million if all 2,700 applications were
    fraudulent, as he strongly suspected. In another case, an attorney
    allegedly charged aliens between $8,000 and $30,000 to fraudulently obtain
    employment-based visas to work in more than 200 businesses that included
    pizza parlors, auto parts stores, and medical clinics.

    Although the full extent of immigration benefit fraud is unknown,
    available USCIS data indicate that it is a serious problem. According to
    USCIS PAS data, in fiscal year 2005, USCIS denied just over 20,000
    applications because USCIS staff detected fraudulent application
    information or supporting evidence during the course of adjudicating the
    benefit request. Three application categories accounted for more than
    three-quarters of the fraud denials: temporary work authorization (36
    percent), application for permanent residency (30 percent), and
    application for a spouse to immigrate (14 percent). These three
    application types also accounted for almost half of all applications
    adjudicated by USCIS in fiscal year 2005. Moreover, in fiscal year 2005,
    USCIS denied approximately 800,000 applications for other reasons, such as
    ineligibility for the benefit sought or failure to respond to information
    requests. USCIS adjudications staff and officials told us that it is
    likely that some of these applications denied for other reasons also
    involved fraud.

    Information provided by State Department and DOL officials also indicates
    that fraud is a serious problem. Once USCIS approves a sponsor's
    application on behalf of an alien to immigrate, the application is sent to
    the State Department's National Visa Center, which forwards the
    application to the appropriate State Department overseas consulate post,
    which then interviews the alien to determine whether a visa should be
    issued. According to National Visa Center officials, out of 2,400
    applications returned on average each month to USCIS by the National Visa
    Center, that are denied or withdrawn for various reasons, about 900
    involve fraud or suspected fraud as determined by consular officers
    overseas. When the DOL Inspector General audited labor certification
    applications filed in 2001, it also found indications of a significant
    amount of fraud. According to the Inspector General, of the approximate
    214,000 applications filed from January 1, 2001, through April 30, 2001,
    and not subsequently cancelled or withdrawn, 54 percent (about 130,000)
    contained false-possibly fraudulent-information. 8

    In June 2005, the FDNS completed the first in a series of fraud
    assessments. The results from this assessment of religious worker
    applications indicate that about 33 percent of the 220 sampled
    applications resulted in a preliminary finding of potential fraud. 9 Based
    on a 33 percent rate, we estimate that, during the 6-month period of
    fiscal year 2004 from which the sample was drawn, about 660 out of
    approximately 2,000 applications may have been fraudulent. 10 Of the 72
    potential fraud cases discovered in the fraud assessment, about 54-percent
    (39 cases) showed evidence of tampering or fabrication of supporting
    documents; 44-percent (32 cases) of the petitioners' addresses did not
    reveal a bona fide religious institution; about 42-percent (30 cases) may
    have misrepresented the beneficiaries' qualifications; and 28-percent (20
    cases) did not provide the salary noted in the application. The assessment
    also uncovered one case where law enforcement had identified an applicant
    as a suspected terrorist.

    Information from other investigations and prosecutions of benefit fraud
    also reveal that, in some cases, applicants may have submitted fraudulent

    8

    DOL Inspector General, Restoring Section 245(i) of the Immigration
    Nationality Act Created a Flood of Poor Quality Foreign Labor
    Certification Applications Predominantly for Aliens Without Legal Work
    Status, Report No: 6-04-004-03-321 (Washington, D.C. : Sept. 30, 2004).

    9

    USCIS reviewed applications submitted on behalf of religious workers-such
    as ministers, or other individuals who work in a professional capacity in
    a religious vocation or occupation-seeking an immigrant visa in order to
    work in the United States. FDNS chose this application because based upon
    past experience FDNS believed there was a high prevalence of fraud.
    According to FDNS, most of the fraud involved religious institutions that
    were not affiliated with a major religious organization.

    10

    However, with a sampling margin of error of 5 percent, the fraud rate
    could be between 28 percent and 38 percent.

    documents and made false statements that were not detected before the
    applicant obtained an immigration benefit. For example, while
    investigating one fraud scheme, investigators identified more than 2,000
    apparently fraudulent applications where there was evidence that some
    aliens, fraudulently claiming to be managers and executives of foreign
    companies with U.S. affiliates, acquired benefits that granted them the
    ability to work in the United States. To execute this scheme, organizers
    allegedly prepared application packages that included fraudulent business
    and employee related documents including financial statements, business
    plans, organizational charts, and fictitious employee resumes.

    One joint law enforcement investigation, previously mentioned, uncovered
    evidence that an attorney and his associate had filed at least 1,436
    applications on behalf of legitimate companies-mostly local
    restaurants-that did not actually request these workers. In this case
    there was evidence that they forged the signatures of company management
    on the applications. Another investigation involving marriage fraud found
    evidence that U.S. citizens were recruited and paid to marry Vietnamese
    nationals. The fraud organizers appeared to have assisted the U.S.
    citizens in obtaining their passports, scheduled travel arrangements, and
    escorted them to Vietnam where they arranged introductions with Vietnamese
    nationals whom the citizens then married. These citizens then filed
    applications that facilitated these Vietnamese nationals' entry into the
    United States as spouses even though it appeared that they did not intend
    to live together as husband and wife.

    Even when adjudicators rejected applications based on fraud, some of these
    applicants had already received interim benefits while their applications
    were pending final adjudication allowing them to live and work in the
    United States, and in some cases obtain other official documents, such as
    a driver's license. Under current USCIS policy, for example, if USCIS
    cannot adjudicate an application for permanent residency and the
    accompanying application for work authorization within 90 days, the
    applicant is entitled to an interim work authorization, an interim benefit
    designed to let applicants work while awaiting a decision regarding
    permanent residency. 11 According to the Citizenship and Immigration
    Services Ombudsman's fiscal year 2004 and 2005 annual

    8 C.F.R. S: 274a.13(d). 8 CFR S: 274a.12(c) states that USCIS has the
    discretion to establish a specific validity period for an employment
    authorization document, and 8 C.F.R. S: 274a.13(d) provides that such
    period shall not exceed 240 days in the case of an interim authorization.

    Page 17 GAO-06-259 Immigration Benefits

    reports and our discussion with him, for many individuals the primary goal
    is to obtain temporary work authorization regardless of the validity of
    their application for permanent residency. That is, aliens can apply for
    temporary work authorization, knowing that they do not qualify for
    permanent residency, with the intent of exploiting the system to gain work
    authorization under false pretenses.

    Once a temporary work authorization is fraudulently obtained, an alien can
    use it to obtain other valid identity documents such as a temporary social
    security card and a driver's license, thus facilitating their living and
    working in the United States. According to the FDNS Director, once such
    fraud scheme involved at least 2,500 individuals in Florida who allegedly
    filed frivolous applications for employment authorization and then used
    the receipt, showing they had filed an application, to obtain Florida
    State driver's licenses or identification cards. 12 ICE agents we
    interviewed also said that they suspected that many individuals apply for
    permanent residency fraudulently simply to obtain a valid temporary work
    authorization document. The interim benefit remains valid until it expires
    or until it is revoked by USCIS.

    In his 2005 report, the Ombudsman cites a DHS Office of Immigration
    Statistics estimate-which the ombudsman's office confirmed with USCIS's
    division of performance management-that about 85 percent of applicants for
    permanent residency also apply for temporary work authorization. As a
    result, according to the ombudsman, many aliens have received temporary
    work authorizations, for which they were later found to be ineligible. Our
    analysis of PAS data shows, for example, that from fiscal year 2000
    through 2004, USCIS denied 26,745 applications due to fraud out of the
    approximately 3 million applications received for permanent residency.
    These data illustrate that, if aliens that filed fraudulent applications
    for permanent residency also requested temporary work authorization at a
    rate consistent with the 85 percent cited by the Office of Immigration
    Statistics, then thousands of aliens received temporary work authorization
    based on their fraudulent claims for permanent residency during fiscal
    year 2000 through 2004.

    USCIS subsequently informed Florida's Department of Highway Safety and
    Motor Vehicles, and the American Association of Motor Vehicles
    Administration issued a national advisory notifying other state motor
    vehicle departments that they should not accept the application receipt as
    evidence of lawful immigration status.

    Page 18 GAO-06-259 Immigration Benefits

      Although USCIS Has Taken Steps to promote Fraud Control, Additional Controls
      and Best Practices Could Improve Its Ability to Detect Fraud

    To help it detect immigration benefit fraud, USCIS has taken some
    important actions consistent with activities prescribed by the Standards
    for Internal Control in the Federal Government and with recognized best
    practices in fraud control. Specifically, it has established an internal
    unit to act as its focal point for addressing immigration benefit fraud,
    outlined a strategy for detecting immigration benefit fraud, and is
    undertaking a series of fraud assessments to identify the extent and
    nature of fraud for certain immigration benefits. However, USCIS has not
    applied some aspects of internal control standards and fraud control best
    practices that could further enhance its ability to detect fraud.

        Internal Control Standards and Other Guidance Provide Direction for
        Establishing Good Fraud Control Practices

    The Standards for Internal Control in the Federal Government provide an
    overall framework to identify and address, among other things fraud,
    waste, abuse, and mismanagement. Implementing good internal control
    activities and establishing a positive control environment is central to
    an agency's efforts to detect and deter immigration benefit fraud. The
    standards address various aspects of internal control that should be
    continuous, built-in components of organizational operations, including
    the control environment, risk assessment, control activities, information
    and communications, and monitoring.

    As with work we have previously published related to managing improper
    payments, fraud control would typically require a continual interaction
    among these components in keeping with an agency's various objectives. 13
    For example, internal controls that promote ongoing monitoring work
    together with risk assessment controls to provide a foundation for
    decision making. Also, as internal control standards advise, a
    precondition to risk assessment is the establishment of clear, consistent
    agency objectives. Once established, risk assessment controls must also
    work together with information and communication controls to ensure that
    that every level of the agency is cognizant of the commitment and approach
    to both controlling fraud and meeting other agency objectives. Similarly,
    conditions governing risk change frequently, and periodic updates are
    required to ensure that risk information-including threats,
    vulnerabilities, and consequences-stays current and relevant. Information
    collected

    13

    GAO, Strategies to Manage Improper Payments, Learning from Private Sector
    Organizations, GAO-02-69G ( Washington, D.C.: October 2001).

    Page 19 GAO-06-259 Immigration Benefits

    through periodic assessment, as well as daily operations can inform the
    assessment, and particularly, the analysis of risk. As shown in figure 3,
    the control environment surrounds and reinforces the other components, but
    all components work in concert toward a central objective, which, in this
    case, is to minimize immigration benefit fraud.

                         Figure3: Internal Control Environment

    Source: GAO.

    Other audit organizations have published guidance that includes discussion
    of sound management practices for controlling fraud that complement the
    internal control standards. Among these are the American Institute of
    Certified Public Accountants (AICPA) guidance on management of antifraud
    programs and controls to help prevent and deter fraud 14 and a fraud
    control practices guide developed by the United Kingdom's National Audit
    Office (NAO) entitled "Good Practices in Tackling External Fraud." The NAO
    guidance outlines a risk-based

    Excerpt from Statement on Auditing Standards, No. 99, Considerations of
    Fraud in a Financial Statement Audit.

    Page 20 GAO-06-259 Immigration Benefits

        Consistent with Internal Control Standards and Fraud Control Best Practices,
        USCIS Has Established a Fraud Focal Point, Related Strategies, and a Fraud
        Assessment Program

    strategic approach to combating fraud that also includes evaluating the
    effectiveness of sanctions.

    According to internal control standards, factors leading to a positive
    control environment include clearly defining key areas of authority and
    responsibility, establishing appropriate lines of reporting, and
    appropriately delegating authority and responsibility for operating
    activities. Similarly, the NAO fraud control guidance advises agencies to
    develop specific strategies to coordinate their fraud control efforts and
    to ensure that someone is fully responsible for implementing the plans in
    the way intended and that sufficient resources are in place. Consistent
    with internal control and best practice guidance, USCIS established the
    FDNS office to enhance its fraud control efforts by serving as its focal
    point for addressing immigration benefit fraud.

    Established in 2003, FDNS is intended to combat fraud and foster a
    positive control environment by pursuing the following objectives:

            * develop, coordinate, and lead the national antifraud operations for
              USCIS;
            * o  oversee and enhance policies and procedures pertaining to the
              enforcement of law enforcement background checks on those applying
              for immigration benefits;
         o identify and evaluate vulnerabilities in the various policies,
           practices and procedures that threaten the legal immigration process;
         o recommend solutions and internal controls to address these
           vulnerabilities; and
         o act as the primary USCIS conduit and liaison with ICE, U.S. Customs
           and Border Protection (CBP), and other members of the law enforcement
           and intelligence community.

    In September 2003, in support of its objectives, FDNS outlined a strategy
    for detecting immigration benefit fraud in USCIS's National Benefit Fraud
    Strategy. According to the strategy, because most immigration benefit
    fraud begins with the filing of an application, a sound approach to fraud
    prevention begins at the earliest point in the process-the time an
    application is received. Accordingly, USCIS established FDNS Fraud
    Detection Units (FDU) in each of the service centers in order to help
    identify potential fraud and process adjudicator referrals. Subsequently,
    FDNS appointed staff to serve as Immigration Officers working directly
    with adjudicators at the service centers and district offices to identify
    potential fraud and, to some extent, verify fraud through administrative
    inquiries-once it was determined that ICE had declined to investigate a
    referral-in order to assist adjudicators in making eligibility
    determinations.

    The strategy also discusses various technological tools to help the FDUs
    detect fraud early in the process-in particular, by enabling FDNS staff to
    check databases to confirm applicant information and by developing new
    automated tools to analyze application system data using known fraud
    indicators and patterns to help identify potential cases of fraud. USCIS
    has hired a contractor to develop for FDNS an automated capability to
    screen incoming applications against known fraud indicators, such as
    multiple applications received from the same person. According to FDNS, it
    plans to deploy an initial data analysis capability by the third quarter
    of fiscal year 2006 and release additional data analyses capabilities at
    later dates, but could not predict when these latter capabilities would be
    achieved. However, according to an FDNS operations manager, the near and
    midterm plans are not aimed at providing a full data mining capability. In
    the long term, USCIS plans to integrate these data analyses tools for
    fraud detection into a new application management system being developed
    as part of USCIS's efforts to transform its business processes for
    adjudicating immigration benefits, which includes developing the
    information technology needed to support these business processes. Also,
    in the long term, according to the FDNS Director, a new USCIS application
    management system would ideally include fraud filters to screen
    applications and remove suspicious applications from the processing stream
    before they are seen by adjudicators.

    FDNS has adopted as one of its objectives the identification and
    evaluation of vulnerabilities in USCIS policies, practices, and procedures
    that threaten the immigration benefit process. Consistent with this
    objective and good internal control practices, in February 2005, FDNS
    began to conduct a series of fraud assessments aimed at determining the
    extent and nature (i.e., how it is committed) of fraud for several
    immigration benefits that FDNS staff determined, based on past studies and
    experience, benefit fraud may be a problem. To conduct these assessments,
    FDNS first selected a statistically valid sample of applications. 15 FDNS
    field staff then attempted to verify whether key

    For each of assessment, USCIS plans to review a sample of applications
    designed to achieve a 95 percent confidence interval. Reviews will be
    conducted by Immigration Officers in district offices.

    Page 22 GAO-06-259 Immigration Benefits

        Additional Internal Controls and Use of Other Best Practices Could Further
        Improve USCIS's Ability to Detect Benefit Fraud

    USCIS Has Not Adopted a Comprehensive Risk Management Approach to Help
    Guide Its Fraud Control Efforts

    information on the applications was true. They did this by doing such
    things as comparing information contained in benefit applications with
    information in USCIS data systems and law enforcement and commercial
    databases, conducting interviews with applicants, and, in some cases,
    visiting locations to verify, for example, whether a business actually
    existed. As of December 2005, FDNS had completed its assessment of the
    religious worker application and replacement of permanent resident card
    applications, and was in the process of completing the assessment of two
    immigrant worker application subcategories. 16 As of December 2005, FDNS
    planned to initiate two other assessments in January 2006 and another at a
    later time. 17

    Although USCIS has taken some important steps consistent with internal
    control standards and other good fraud control practices, it has not yet
    implemented some aspects of internal control standards and fraud control
    best practices that could further enhance its ability to detect fraud.
    Specifically, it lacks (1) a comprehensive approach for managing risk, (2)
    a monitoring mechanism to ensure that knowledge arising from routine
    operations informs the assessment of policies and procedures, (3) clear
    communication regarding how to balance multiple agency objectives, (4) a
    mechanism to help ensure that adjudicators staff have access to important
    information, and (5) performance goals related to fraud prevention.

    Although FDNS has initiated a fraud assessment program that identifies
    vulnerabilities for the specific benefit being assessed, it does not
    employ a comprehensive risk management approach to help guide its fraud
    control efforts. That is, FDNS has not (1) developed a plan for assessing
    the majority of benefits that USCIS administers, (2) fully incorporated
    threat and consequence information as part of the assessment process, and
    (3) applied a risk-based approach to evaluating alternatives for
    mitigating identified vulnerabilities.

    16

    For the religious worker assessment, USCIS staff reviewed a sample of 220
    cases that were randomly selected from a 6-month period of April 1, 2004,
    to September 30, 2004. For the replacement of permanent resident card
    assessment, USCIS staff reviewed a sample of 245 cases that were selected
    from a 6-month period of May 1, 2004, to October 31, 2004. Cases selected
    included pending and completed cases.

    17

    USCIS asked that we not divulge the specific benefit types planned for
    future assessments because of concerns that publishing this information
    could jeopardize the validity of these future assessments.

    A central component of the Standards for Internal Control in the Federal
    Government is risk assessment, which includes identifying and analyzing
    risks that agencies face from internal and external sources and deciding
    what actions should be taken to manage these risks. NAO's fraud control
    guide also advises that in the fraud context, risk assessment involves
    such things as assessing the size of the threat from external fraud, the
    areas most vulnerable to fraud, and the characteristics of those who
    commit fraud. Moreover, we have consistently advocated a model of risk
    management that takes place in the context of clearly articulated goals
    and objectives and includes comprehensive assessments of threats,
    vulnerabilities, and consequences to help agencies evaluate and select
    among alternatives for mitigating risk in light of the potential for a
    given activity to be effective, the related cost of implementing the
    activity, and other relevant management concerns (including its impact on
    other agency objectives). 18

    FDNS fraud assessments are an initial step toward adopting a risk
    management approach. However, FDNS has no specific plans to assess the
    majority of the benefit types that it administers. FDNS's current plan
    calls for assessing benefit types that represent only about 25 percent of
    the applications USCIS received in fiscal year 2004, for example, and do
    not include benefits like temporary work authorization which accounted for
    almost 30 percent of applications received in 2004, and which the CIS
    Ombudsman suspects may be a high risk for fraud, and for which PAS data
    show a high denial rate for fraud. FDNS officials told us that, although
    the fraud assessments have been valuable, they have taken more time and
    effort than originally planned. Likewise, FDNS has not established a
    strategy and methodology for prioritizing any future fraud assessments.
    Until it extends the assessments to additional benefit types, the fraud
    assessments offer only limited information about vulnerabilities to the
    immigration benefits system

    Moreover, the approach to risk management that we advocate calls for the
    assessment of threats and consequences, in addition to the vulnerability
    information provided by the current approach to fraud assessment.
    Currently, the fraud assessments do not incorporate a comprehensive

    See, for example, GAO, Homeland Security: A Risk Management Approach Can
    Guide Preparedness Efforts , GAO-02-208T (Washington, D.C.: October 2001);
    and GAO, Risk Management: Further Refinements Needed to Assess Risks and
    Prioritize Protective Measures at Ports and Other Critical Infrastructure,
    GAO-06-91 (Washington, D.C.: December 2005).

    Page 24 GAO-06-259 Immigration Benefits

    threat assessment-that is, they do not draw on all available sources of
    threat information-for example, information that might be available from
    such sources as ICE's Office of Intelligence and other DHS intelligence
    gathering efforts. Threat assessment might help FDNS identify, for
    example, whether terrorists might be more likely to try to exploit certain
    immigration benefits. Neither do the fraud assessments include an
    assessment of the consequences of granting a particular benefit to a
    fraudulent filer. Such an assessment might help USCIS determine the
    relative harm that granting such a benefit might pose to the United States
    and its immigration benefit system. Although ultimately any benefit
    obtained under false pretenses undermines the system established by U.S.
    immigration law, consideration of whether, for example, granting a
    specific benefit may also facilitate easier access for potential
    terrorists to critical infrastructure or pose a greater detriment to the
    U.S. economy could inform sound risk-based decision making.

    Equipped with a more comprehensive understanding of the risks it faces-
    particularly which benefits represent the highest risk, USCIS management
    would then be in a better position to select appropriate risk mitigation
    strategies and actions, particularly in situations where it is necessary
    to make resource trade-offs or to balance multiple agency objectives. For
    example, an obvious vulnerability to the immigration benefit system is the
    submission of false eligibility evidence. Currently, however, USCIS
    procedures do not include the verification of any eligibility evidence for
    any benefit, despite its potential to help mitigate vulnerability to
    fraud. 19 Verification of such evidence-by comparing it to other
    information in USCIS databases, by checking it against external sources of
    information, or by interviewing applicants-is the most direct and
    effective strategy for mitigating this vulnerability. Employer wage data
    reported to state labor agencies, for example, could be a useful source of
    information to help determine if an employer has paid prevailing wages.
    Data from state motor vehicle departments can be used to verify that the
    two individuals claiming to be married live at the same address. We
    previously reported that USCIS could benefit from verifying employer
    related information with the

    According to the Adjudicator's Field Manual, adjudicators are to try to
    adjudicate the application based only on their review of the evidence
    submitted. The field manual further states that only when an adjudicator
    cannot decide whether to grant an immigration benefit based on the
    evidence submitted, are they to consider taking additional steps such as
    conducting internal research, requesting additional evidence, interviewing
    individuals, or requesting a site visit.

    Page 25 GAO-06-259 Immigration Benefits

    Internal Revenue Service. 20 USCIS adjudicators told us that access to
    commercial databases that provide identification and credential
    verification would be helpful in verifying information contained in
    benefit applications. Additionally, district office adjudicators told us
    that it was often only during interviews that fraud became evident, even
    when their earlier review had not raised suspicions. 21 A successful State
    Department effort offers further evidence that the practice of verifying
    key information can be an effective mitigation strategy. Due to a high
    incidence of fraud in a program that allows foreign companies to bring
    executives into the United States, one State Department consular post in
    Latin America began verifying with local authorities two key pieces of
    evidence that applicants were required to submit. According to the post,
    it subsequently noticed a decrease in the number of potentially fraudulent
    applications for this benefit.

    On the other hand, verifying any applicant-submitted evidence in pursuit
    of its fraud-prevention objectives represents a resource commitment for
    USCIS and a potential trade-off with its production and customer
    servicerelated objectives. In fiscal year 2004, USCIS had a backlog of
    several million applications and has developed a plan to eliminate it by
    the end of fiscal year 2006. 22 In June 2004, USCIS reported that it would
    have to increase monthly production by about 20 percent to achieve its
    legislatively mandated goal of adjudicating all applications within 6
    months or less by the end of fiscal year 2006. According to USCIS, because
    it does not plan to increase its current overall staffing level, meeting
    its backlog reduction goal will require some combination of reductions in
    the standard processing time for various applications, overtime hours, and
    adjudicator reassignments. It would be impossible for USCIS to verify all
    of the key information or interview all individuals related to the
    millions of applications it adjudicates each year-approximately 7.5
    million applications in fiscal year 2005-without seriously compromising
    its service-related objectives. Identifying situations and benefits that
    represent the highest risk to USCIS could help its management determine
    whether and under what circumstances verification is so vital to

    20 See GAO, Taxpayer Information: Options Exist to Enable Data Sharing
    between IRS and USCIS but Each Presents Challenges, GAO-06-100 (
    Washington, D.C.: Oct. 11, 2005).

    21

    Currently, personal interviews are conducted only for certain applications
    and only in USCIS's district offices.

    22

    See GAO, Improvements Needed to Address Backlogs and Ensure Quality of
    Adjudications, GAO-06-20 ( Washington D.C.: November 2005).

    Page 26 GAO-06-259 Immigration Benefits

    maintaining the integrity of the immigration benefits system that it
    outweighs any potential increase in processing time and costs. In this
    example, such an approach to risk management would inform selection among
    alternative verification strategies by considering (1) the risk of failing
    to detect fraud based on information provided by assessments of
    vulnerabilities, threats, and consequences, (2) the cost of conducting the
    verification (including its effect on other organizational objectives like
    service), and (3) the potential for the verification activities, given the
    current tools and information available, to actually detect fraud.

    In addition to procedural vulnerabilities like the verification example, a
    risk management approach could also guide USCIS in the evaluation of
    policies that strike a balance between two or more agency objectives and
    organizational priorities. For example, as previously discussed, USCIS's
    policy of granting interim employment authorization documents to
    applicants whose adjustment of status applications have not been
    adjudicated within 90 days can be exploited by aliens seeking to gain work
    authorization under false pretenses and to use work authorization to
    obtain valid identity documents such as temporary social security cards
    and drivers licenses. In his 2004 and 2005 annual reports, the CIS
    Ombudsman identified this policy as a significant vulnerability in the
    immigration benefits process, because he contends that for many
    individuals the primary goal is to obtain temporary work authorization
    regardless of the validity of their applications for permanent residency.
    On the other hand, as we have previously reported, the reason for issuing
    temporary work authorization is to allow legitimate applicants to work as
    soon as possible, which according to USCIS, can serve to reduce the
    negative effects of delay on applicants and their families. 23 Using more
    comprehensive risk information to evaluate policies that represent
    tradeoffs between fraud control and other agency objectives may help USCIS
    management determine whether and to what extent unintended policy
    consequences like in this example place the integrity of the immigration
    benefits system at risk. This kind of risk management approach also would
    provide USCIS management an opportunity to evaluate and select among
    various approaches to balancing fraud control with other agency
    objectives. In the temporary work authorization example, USCIS could
    evaluate a variety of alternative strategies and select among them on the
    basis of all available information, including risk. These strategies might

    See GAO, Immigration Benefits: Several Factors Impede Timeliness of
    Application Process, GAO-01-488 (Washington D.C.: May 2001).

    Page 27 GAO-06-259 Immigration Benefits

    USCIS Lacks a Mechanism to Ensure That Ongoing Monitoring Occurs in the
    Course of Normal Operations

    include: (1) maintaining the current policy if it is found to pose a
    tolerable level of risk, (2) seeking applicable regulatory changes, or (3)
    applying the policy disparately, to the extent allowed by law, across
    benefit types based on the level of risk each represents. In commenting on
    a draft of this report, DHS stated that a proposed regulatory change would
    clarify USCIS's ability to withhold the adjudication of an application for
    employment authorization pending an ongoing investigation.

    Internal control standards advise that controls should be generally
    designed to ensure that ongoing monitoring occurs in the course of normal
    operations and is ingrained in the agency's operations. FDNS's fraud
    assessment program provides some information about how fraud is committed
    in the form of concentrated periodic assessments. However, currently USCIS
    does not have a mechanism to ensure routine feedback to FDNS about
    vulnerabilities identified during the course of normal operations and to
    incorporate it into adjudication policies and procedures.

    Besides information about vulnerabilities obtained from its operational
    experience adjudicating applications, additional information might be
    available to FDNS from external entities that also have responsibility for
    some aspect of controlling benefit fraud. One external source of fraud
    information that might inform USCIS operations is the U.S. Attorneys
    Office, which prosecutes immigration benefit fraud cases. For example, one
    U.S. Attorney, based on cases his office has prosecuted, has issued
    memoranda showing how underlying regulatory and adjudication processes
    have invited abuse of the immigration system. A March 2005 memorandum
    prepared by this office explained how a recent investigation revealed
    significant weaknesses in the asylum process that allowed ineligible
    aliens to obtain asylum, and made suggestions for reforming the process.
    The memorandum stated that these suggestions were intended to start a
    discussion among federal agencies with immigration responsibilities that
    could lead to needed reforms. In commenting on a draft of this report, DHS
    stated that USCIS is developing a plan of action to work with other DHS
    entities and the Executive Office of Immigration Review within the
    Department of Justice to respond to specific recommendations made by the
    U.S. Attorney that prepared the memorandum on asylum program weaknesses.

    Another source of information available to USCIS about fraud
    vulnerabilities are the criminal investigations conducted by ICE, DOL, and
    the DHS Office of Inspector General, 24 which could reveal such
    information as the characteristics of those who commit fraud and how these
    individuals exploited weaknesses in the immigration benefit process to
    obtain benefits illegally. USCIS's National Benefit Fraud Strategy does
    not mention incorporating lessons learned from investigative and
    prosecutorial activities into its fraud control efforts-specifically, how
    the knowledge ICE, DOL, and DHS investigators and U.S. Attorneys gained
    during the course of investigations and prosecutions could be collected
    and analyzed in order to become aware of opportunities to reduce fraud
    vulnerabilities. 25 A mechanism to help ensure that information from these
    and related sources results in appropriate refinements to policies and
    procedures could enhance USCIS's efforts to address fraud vulnerabilities.

    DOL, which plays an important role in the benefits process for some
    permanent employment benefits, has used external information to refine its
    procedures in this way. Specifically, it analyzed the results of major
    criminal investigations and prosecutions to evaluate and establish new
    procedures that require verifying key application information, such as the
    existence of a business. DOL found it was necessary to change its
    permanent labor certification procedures to require verification of basic
    application information in order to mitigate the risk of mistakenly
    approving permanent labor certification applications, and protect the
    fundamental integrity of the labor certification process from blatant
    abuse. 26

    24

    Among other things, this office investigates criminal allegations of USCIS
    employee involvement in immigration benefit fraud. The DHS Office of
    Inspector General provides the results of such investigations to USCIS's
    Office of Security and Investigations.

    25

    A February 2006 memorandum of agreement between USICS and ICE requires ICE
    to submit a report to USCIS on the findings of investigations resulting
    from referrals from USCIS. However, the memorandum does not require ICE to
    report the findings from benefit fraud investigations resulting from leads
    from other sources, such as other ICE investigations or other agencies.

    26

    For permanent employment immigration, petitioners are required to obtain
    labor certifications from the Department of Labor. The DOL is required to
    certify that there are not sufficient U. S. workers who are able, willing,
    qualified, and available and that at least the prevailing wage will be
    paid. The labor certification is then submitted to USCIS along with an
    application for an alien worker using an I-140 immigration form. USCIS's
    responsibility is to then ensure that the prospective employee has the
    necessary qualifications for the job.

    USCIS May Not Clearly Communicate the Importance of Fraud Control and How
    Adjudicators Are to Balance It with Other Objectives

    Internal control standards advise that for agencies to manage their
    operations, they must have relevant, reliable, and timely communications.
    Furthermore, establishing a positive fraud control environment is central
    to an agency's efforts to detect and deter immigration benefit fraud. The
    NAO guidance also advises management to ensure that all levels of the
    organization are made to share a concern about fraud. It is the stated
    mission of USCIS to provide the right benefit, to the right person, at the
    right time, and no benefit to the wrong person. Specifically, it aims to
    adjudicate all benefit requests within 6 months of receipt, without
    compromising the integrity of the process, nor significantly increasing
    staff. These objectives-speed, quality, and cost-are inherently in tension
    with one another. Therefore, it is particularly important, given USCIS's
    multiple objectives, that it clearly communicates the importance of each
    of the objectives at every level of the organization, and provides clear
    guidance to adjudicators about how to balance them in the course of their
    daily duties.

    Although USCIS's backlog elimination plan acknowledges the need to balance
    its focus on reducing the backlog with efforts to ensure adjudicative
    quality, some USCIS adjudicators we interviewed indicated that it was not
    clear to them how the agency expected them to balance fraud detection
    efforts and production goals during the course of their duties.
    Adjudicators we spoke with said that communications from management
    emphasized meeting production backlog goals almost exclusively. They said
    that management's focused attention on reducing the backlog placed
    additional pressure on them to process applications faster, thereby
    increasing the risk of making incorrect decisions, including approving
    potentially fraudulent applications. For example, adjudicators at all four
    service centers we spoke with told us that operations management seemed to
    be almost exclusively focused on reducing the backlog in order to meet
    production goals. 27 USCIS headquarters operations management responsible
    for overseeing adjudications at service centers and district offices told
    us that the adjudications operation is a "high-pressure" production
    environment and that they are seeking to increase production, but it was
    not their intention that this should come at the expense of making
    incorrect adjudication decisions.

    27

    At one service center the union representing adjudicators filed a
    grievance in June 2005 claiming that proposed new performance standards
    for adjudicators were unrealistic and would compromise the quality of
    adjudication decisions.

    Page 30 GAO-06-259 Immigration Benefits

    The FDNS Director told us that he had also discussed with operations
    management the need to strike a more balanced approach to meeting
    production goals and ensuring that the right eligibility decision is made.
    He acknowledged that until FDNS establishes an ability to proactively
    identify fraud through its automated analysis tools, adjudicators will
    continue to play a primary role in detecting fraud. Therefore, he
    acknowledged the importance of clear and balanced communications from
    operations management to adjudicators in support of USCIS's new fraud
    detection process and the shared responsibilities in this regard.

    Nevertheless, adjudicators we interviewed told us that they have received
    guidance from different parts of the agency regarding the lengths to which
    they should go in confirming suspected fraud that they were uncertain how
    to interpret. For example, in December 2004, the FDNS Director issued
    guidance stating that adjudicators should obtain the evidence needed to
    support their suspicions of fraud before making a referral, including, if
    necessary, requesting additional evidence from applicants. According to
    adjudicators and FDU staff we interviewed, this guidance appears to
    conflict with a subsequent January 2005 memorandum, issued by the Director
    of Service Center Operations, which states that adjudicator requests for
    information should not be used as a device simply to "investigate"
    suspected fraud. Adjudicators we interviewed at one service center said
    that whenever operations management communicated with them about
    practicing more discretion in issuing requests for additional evidence,
    they believed it was primarily intended to put more pressure on them to
    process applications faster, which in turn they said puts additional
    pressure on them to not to request additional evidence when making
    eligibility decisions. Consequently, they were concerned about having to
    approve applications with less confidence in the correctness of their
    determinations. An FDNS Immigration Officer working in a service center
    echoed the adjudicators concerns about seemingly conflicting guidance,
    saying that interpreting such guidance from management made the job of
    adjudicators more difficult. However, he said that adjudicators and local
    managers would more likely heed the direction of USCIS operations
    management, their direct supervisors, rather than FDNS. Clear
    communications about the importance of both fraud prevention-related and
    service-related objectives and how they are to be balanced may help
    adjudicators ensure that they are appropriately supporting USCIS's
    multiple objectives as they carry out their duties. In commenting on a
    draft of this report, DHS stated that the USCIS Director moved FDNS to a
    new directorate that reports directly to the USCIS Deputy Director. This
    will allow FDNS to provide focus and guidance to all USCIS operations.

    Adjudicators and FDNS Staff Lack Access to Important Information and
    Information Tools

    USCIS does not have a mechanism to help ensure that adjudicators have
    access to information related to detecting fraud they may need to carry
    out their responsibilities. Information regarding fraud trends can be
    provided in various forms including e-mails, intranet Web pages, and
    bulletin board notices. The adjudicators at the service centers and
    district offices we visited received some fraud-related information or
    training subsequent to their initial hire. 28 Our interviews indicated,
    however, that the frequency and method for distributing ongoing
    information about fraud detection is not uniform across the service
    centers and district offices we visited; some adjudicators reported that
    more information or a more centralized information management system would
    better prepare them to detect fraud. At two service centers, adjudicators
    we interviewed told us that, after their initial training, they were
    provided with some information regarding fraud trends via e-mail. However,
    these adjudicators also reported difficulty with managing the information
    in this format. They said that providing this information through a
    different means-either through a Web-based system or through a training
    course that would summarize new knowledge related to fraud trends-would be
    easier and quicker to use. One of the service centers provided
    adjudicators with operating manuals-developed for specific benefit
    application types-that included information regarding typical fraud trends
    encountered by the service center, which adjudicators said they found
    useful in their efforts to detect fraud.

    At two other service centers, adjudicators we interviewed told us that
    they were not provided any fraud e-mail updates but received some limited
    information about fraud during general group meetings. Adjudicators at
    these two centers told us that receiving more specific and detailed
    information about fraud trends and practices would enhance their ability
    to detect fraud. At one service center, adjudicators suggested that having
    a method by which to incorporate the knowledge and lessons learned from
    experienced adjudicators would also help them to better detect fraud.
    Additionally, one of the district offices we visited provided an
    additional 2day training course that included techniques for detecting
    fraud during an interview. Adjudicators we interviewed at this district
    office told us that the course helped prepare them to better detect fraud.
    USCIS headquarters officials responsible for field operations told us that
    there is

    28

    USCIS initial adjudicator training provides approximately 4 hours of
    fraud-related training that focuses primarily on detecting fraudulent
    documents during 6 weeks of training.

    Page 32 GAO-06-259 Immigration Benefits

    no standard training regarding fraud trends and that fraud-related
    training varied across field offices.

    In addition to calling for relevant information to be shared internally,
    internal control standards require that management ensure that there are
    adequate means of communicating with and obtaining from external
    stakeholders information that may have a significant impact on achieving
    agency goals. During our audit work, USCIS and ICE, had not yet
    established a feedback mechanism for the timely sharing of information
    related to the status and outcomes of fraud referrals that is essential to
    the fraud referral process shared by USCIS and ICE. According to FDNS
    field staff we interviewed, information from ICE field offices on the
    status of USCIS referrals-for example, whether ICE has initiated an
    investigation in response to a referral-was sporadic and incomplete in
    some cases and non-existent in other cases. In addition, when ICE fails to
    accept a referral, FDNS may initiate an administrative inquiry to resolve
    an adjudicator's suspicions of fraud. However, because ICE did not
    routinely provide information about its investigative decisions, it was
    difficult for FDNS to know when to initiate such inquiries or to plan for
    the staff time needed to conduct them. Moreover, according to FDNS staff
    and adjudicators we interviewed, without timely feedback about the
    investigative status of their referrals, adjudicators lacked the
    information needed to make more timely eligibility determinations, whether
    or not an investigation is opened by ICE. In November 2005, ICE and USCIS
    officials told us that ICE investigators were recently assigned to each of
    the FDUs, which may help increase communication and information sharing
    between USCIS and ICE.

    Additionally, according to the FDNS Director, having direct access to
    information stored in ICE's case management information system, the
    Treasury Enforcement Communication System (TECS) maintained by Customs and
    Border Protection (CBP), would allow FDNS staff to determine with greater
    certainty whether someone who has filed for an immigration benefit is
    connected to any ongoing ICE criminal investigation. However, ICE
    officials told us they opposed allowing FDNS access to sensitive case
    management information. They said that there was a need to segregate
    sensitive law enforcement data about ongoing cases from non-law
    enforcement agencies like FDNS.

    In commenting on a draft of this report, DHS provided us with a February
    14, 2006, memorandum of agreement between ICE and USCIS that established a
    mechanism for the sharing of information related to the status and
    outcomes of fraud referrals. In addition the agreement provides USCIS
    staff with access to TECS data so USCIS can determine whether

               DHS Lacks Performance Goals for USCIS's Antifraud Efforts

    someone who has filed for an immigration benefit is connected to any
    ongoing ICE criminal investigation. If properly implemented, this
    agreement should resolve USCIS's concerns regarding the status and outcome
    of fraud referrals to ICE and access to TECS data.

    Internal control standards call for agencies to establish performance
    measures to monitor performance related to agency objectives. Measuring
    performance allows an organization to track progress made toward achieving
    its objectives and provides managers with crucial information on which to
    base management decisions. The Government Performance and Results Act
    (GPRA) of 1993 also requires that agencies establish longterm strategic
    and annual goals, measure performance against these goals, and report on
    the progress made toward meeting their missions and objectives. It calls
    for agencies to assess specific outcomes related to their missions and
    objectives, in addition to designing output measures to describe
    attributes of the goods and services produced by the agencies' programs.

    USCIS's 2005 Strategic Plan includes both a prevention theme-ensuring the
    integrity of the system, and a service theme-providing efficient and
    customer oriented services, along with related goals and objectives.
    However, DHS and USCIS have not established specific performance goals to
    assess benefit fraud activities. In fiscal year 2004 USCIS reported
    performance goals related to naturalization, legal permanent residency,
    and temporary residency to DHS for its annual Performance and
    Accountability Report. The objective for each of these three performance
    goals was to "provide information and benefits in a timely, accurate,
    consistent, courteous, and professional manner; and prevent ineligible
    individuals from receiving" the benefit. Although the objective includes
    preventing ineligible individuals from receiving the benefit, the related
    measure-achieve and maintain a 6-month cycle time goal-does not.

    There is no discussion in the strategic plan of how to balance its
    prevention objectives with its service objectives. Instead, USCIS's
    longterm strategic approach appears to rely heavily on the development of
    an enhanced case management system, new fraud databases and data analyses
    tools, and automated information services to overcome the inherent tension
    between these prevention and services themes as they relate to the
    prevention of benefit fraud and reducing the backlog of immigration
    applications. Establishing output measures-for example, the number of
    cases referred to and accepted by FDNS-and outcome measures-for example,
    the percentage of fraudulent applications detected relative to targets
    established using baseline data from fraud

      Most Benefit Fraud Is Not Criminally Prosecuted, but DHS Does Not Have an
      Administrative Sanctions Program

    assessments-could provide USCIS with more complete information about the
    effectiveness of its fraud control efforts in meeting its strategic goal
    objective to ensure the security and integrity of the immigration system.

    FDNS officials told us that they are now participating in USCIS's Office
    of Policy and Strategy Performance Measurement Team's efforts to develop
    performance metrics, and that FDNS is leading an effort to develop metrics
    related to USCIS's strategic goal to ensure the security and integrity of
    the immigration system by increasing the detection of attempted
    immigration benefit fraud. However, specific DHS metrics regarding USCIS's
    antifraud efforts have yet to be developed and approved by DHS.

    Although best practice guidance suggests that sanctions for those who
    commit benefit fraud are central to a strong fraud control environment,
    and the INA provides for criminal and administrative sanctioning, DHS does
    not currently actively use the administrative sanctions available to it.
    Fraud control best practices advise that a credible sanctions program,
    which incorporates a mechanism for evaluating its effectiveness, including
    the wider value of deterrence, is an integral part of fraud control.
    According to the AICPA's fraud guidance, the way an entity reacts to fraud
    can send a strong message that helps reduce the number of future
    occurrences. Therefore, taking appropriate and consistent actions against
    violators is an important element of fraud control and deterrence. The
    guide further advises that a strong emphasis on fraud deterrence has the
    effect of persuading individuals that they should not commit fraud because
    of the likelihood of punishment. Similarly, the NAO guide states that a
    key element of a good fraud control program is to impose penalties and
    sanctions on those who commit fraud in order to penalize those who commit
    fraud and deter others from carrying out similar types of fraud.

    Data provided by USCIS indicates that most benefit fraud it uncovers and
    refers to ICE is not prosecuted. In fiscal year 2005, USCIS referred 2,289
    immigration benefit fraud cases to ICE BFUs. However, 598, about 26
    percent were accepted by the BFUs. Neither USCIS nor ICE provided us with
    information about which of the FDNS referrals accepted by the BFUs
    resulted in an ICE investigation. However, ICE officials said that the
    majority of ICE's immigration benefit fraud investigations do not
    originate with USCIS referrals, but from other investigative sources.
    Given limits on its resources, ICE officials told us that they generally
    prioritize their investigative resources and assign them to cases
    involving individuals who are filing large numbers of fraudulent
    applications for profit, because these cases generally have a greater
    probability of being prosecuted by the

    U.S. Attorneys Offices. Therefore, the principal means of imposing
    sanctions on most immigration benefit fraud would be through
    administrative penalties.

    The INA provides both criminal and administrative sanctions for those who
    commit immigration benefit fraud. 29 The act's criminal provisions provide
    for fines and/or imprisonment for up to 5 years for a person who fails to
    disclose that they have, for a fee, assisted in preparing an application
    for an immigration benefit that was falsely made, and monetary fines
    and/or imprisonment for up to 15 years for a second such conviction. The
    act also provides for administrative penalties for applicants who make
    false statements or submit a fraudulent document to obtain an immigration
    benefit or enter into a marriage solely to obtain an immigration benefit.
    30 For document fraud committed after 1999, it provides monetary fines
    ranging from $275 to $2,200 per document subject to a violation for a
    first offense and from $2,200 to $5,500 per document for those who have
    previously been fined. Monetary penalties collected are to be deposited
    into the Immigration Enforcement Account within the Department of the
    Treasury. Funds from this account can be used for activities that enhance
    enforcement of provisions of the INA including: (1) the identification,
    investigation, apprehension, detention, and removal of criminal aliens;
    (2) the maintenance and updating of a system to identify and track
    criminal aliens, deportable aliens, inadmissible aliens, and aliens
    illegally entering the United States; and (3) for the repair, maintenance,
    or construction of border facilities to deter illegal entry along the
    border. In addition, under certain circumstances, individuals determined
    through the adjudication process to have committed fraud, are deemed
    inadmissible should they later try to file another immigration
    application. In some cases, aliens who are determined in a formal hearing
    to have committed fraud can be removed from the United States and be
    barred from entering in the future.

    DHS does not currently have a clear and comprehensive strategy for
    imposing sanctions or evaluating their effectiveness and is not actively
    enforcing the administrative penalties provided for by the INA. This is
    largely due to a 1998 federal appeals court ruling upholding a nationwide

    29

    Immigration fraud can also be criminally prosecuted under other federal
    statutes.

    30

    8 U.S.C. S:S: 1324c(a), (d); 1154(c).

    permanent injunction against the procedures used by INS to institute civil
    document fraud charges under the INA. 31 The court found that INS provided
    insufficient notice to aliens regarding their right to request a hearing
    on the imposition of monetary fines and the immigration consequences of
    failing to do so, and that until proper notifications were included on the
    fine and hearing waiver forms, INS was enjoined from implementing civil
    penalties for document fraud. According to the Director of Field
    Operations for ICE's Office of Principal Legal Advisor, after the court
    ruling, the government's cost to investigate and prosecute an immigration
    fraud case administratively, including appeals costs, would not be offset
    by the monetary sum that might be obtained. Moreover, the director stated
    that even if successful, there was no guarantee that the government could
    collect its fine from the alien. Therefore, according to the director, ICE
    does not consider implementing the administrative penalties for document
    fraud to be cost-effective. Accordingly, DHS has not made updating the
    forms in response to the ruling a priority. Similarly, another USCIS
    attorney told us that the provision of INA that pertains to marriage fraud
    is rarely used because, due to the significant commitment of resources
    necessary to establish a finding of fraud, enforcing it might not be
    cost-effective. However, DHS has not conducted a formal analysis, which
    includes an attempt to value the benefit of deterrence, to determine the
    total costs and benefits of imposing sanctions.

    Senior USCIS officials we spoke with, however, told us that administrative
    sanctions are important to their fraud control efforts. According to the
    FDNS Director, without the credible threat of a penalty, individuals have
    no fear of filing future fraudulent applications. In this regard, he said
    that FDNS administrative investigations of fraud referrals not
    investigated by ICE are critical, and, in his estimation, the resulting
    denial of a benefit and potential removal of an alien offer an effective
    deterrent to immigration benefit fraud. However, the director said that
    although an alien who commits immigration benefit fraud might be removable
    from the United States and, therefore, has some disincentive to commit
    fraud, U.S. citizens, if they are not prosecuted criminally, have little
    disincentive because without the enforcement of administrative sanctions
    they are not likely to be penalized, even if their violations are
    detected. Additionally, according to the Chief of Staff for USCIS, a
    strategy for administratively sanctioning those who commit fraud is
    necessary for controlling and deterring fraud.

    Walters v. Reno, 145 F.3d 1032 (9th Cir. 1998).

                                      Conclusions

    Although DHS does not actively use its authorities to impose
    administrative penalties, Congress has continued to support the concept in
    legislation. In particular, the Real ID Act of 2005 allows the Secretary
    of Homeland Security, after notice and an opportunity for a hearing, to
    impose an administrative fine of up to $10,000 per violation on an
    employer for a substantial failure to meet any of the conditions of a
    petition for certain non-immigrant workers or a willful misrepresentation
    of a material fact in such a petition, and allows the secretary to deny
    petitions filed with respect to that employer for at least 1 year and not
    more than 5 years. 32 However, without a strategy that includes a
    mechanism for assessing the effectiveness of sanctions and considers both
    the monetary value of fines collected and the value of deterrence, DHS
    will not be able to determine how and under what circumstances to best use
    the authority provided by the INA and other legislation to promote a
    credible threat of punishment in order to deter fraudulent filers.

    Although it lacks a strategy for imposing criminal and administrative
    sanctions, DHS, along with DOL, has proposed administrative rule changes
    that will help sanction those who commit fraud. Among other things, DHS
    has proposed that USCIS be able to deny, for a period of time, all
    applications from employers that DOL or DHS has found, respectively, to
    have submitted false information about meeting regulatory requirements or
    provided statements in their applications that were inaccurate, fraudulent
    or misrepresented a material fact. Final rules have not yet been
    published.

    In light of competing organizational priorities, institutionalizing fraud
    detection-so that it is a built-in part of the adjudications process and
    always a central part of USCIS's planning, procedures, and methods-is
    vital to USCIS's ability to accomplish its goals and objectives,
    particularly protecting the integrity of the immigration benefit system.
    USCIS has taken some important steps to implement internal controls,
    primarily through the activities of the Office of Fraud Detection and
    National Security. By strengthening existing controls and implementing
    additional fraud control practices, USCIS could enhance its ability to
    detect benefit fraud and gain greater assurance that its operations are
    designed to protect the integrity of the system, even as it strives to
    enhance service and meet its backlog reduction goals. Specifically,
    expanding the types of

    32

    Pub. L. No. 109-13, div. B, S: 404(a), 119 Stat. 302, 319-20 (amending 8 U.S.C.
                                      S: 1184(c)).

                        Page 38 GAO-06-259 Immigration Benefits

    benefits it assesses, including assessments of consequence, and drawing on
    all available sources of threat information to develop current fraud
    assessment activities into a more comprehensive risk management approach
    would provide additional knowledge about fraud risks and put the agency in
    a better position to make risk-based evaluations of its policies,
    procedures, and programmatic activities. Also, a mechanism to ensure that
    information uncovered during the course of normal operations-in USCIS and
    related agencies-feeds back into USCIS policies and procedures would help
    to ensure that it addresses loopholes and procedural weaknesses. In
    addition, clear communication of the importance of fraud
    prevention-related objectives and how they are to be balanced, in
    practice, with service-related objectives would help USCIS adjudicators to
    ensure that they are supporting the agency's multiple objectives as they
    carry out their duties. Moreover, the provision of the tools and the
    relevant information that its adjudicators need to help them detect fraud
    could help them make eligibility determinations with greater confidence of
    their accuracy. Finally, performance goals-that include output and outcome
    measures, along with associated targets-reflecting the status of fraud
    control efforts would provide valuable information for USCIS management to
    evaluate its various policies, procedures, and programmatic activities and
    a better understanding of both the progress made and areas requiring more
    focused management attention to enhance fraud prevention.

    By demonstrating sufficiently adverse consequences for individuals who
    perpetrate fraud, sanctions serve to discourage future fraudulent filings,
    as individuals observe that the potential costs of engaging in fraud are
    likely to outweigh the potential gains. It is important to any program
    that encounters fraud to have a credible sanctions program to penalize
    those who engage in fraud and deter others from doing so. Currently, DHS's
    sanctions program for immigration fraud is not a threat to most
    perpetrators because relatively few are prosecuted criminally and
    administrative sanctions are not actively being used. Although DHS
    officials told us that administrative sanctions are not cost-effective,
    comparing only the costs of administering sanctions with the potential
    return from the collection of fines may undervalue their potential
    deterrent effects. Although developing a sound methodology to establish
    and determine the value of deterrence provided by sanctions will require
    effort, best practices call for cost-effective sanctions, and
    consideration of the full range of costs and benefits, financial and
    nonfinancial, is central to making a valid determination of
    cost-effectiveness. Developing and implementing a strategy for imposing
    sanctions that includes a mechanism for assessing effectiveness and that
    more fully evaluates costs and benefits, including nonfinancial benefits
    like the value of deterrence, could give DHS a better indication of how
    and under what circumstances administrative sanctions should be employed
    to enhance USCIS's fraud deterrence efforts.

    In order to enhance USCIS's overall immigration benefit fraud control

      Recommendations for

    environment, we recommend that the Secretary of Homeland Security

    Executive Action direct the Director of USCIS to take the following five
    actions, which are consistent with internal control standards and best
    practices in the area of fraud control:

         o Enhance its risk management approach by (1) expanding its fraud
           assessment program to cover more immigration application types; (2)
           fully incorporating threat and consequence assessments into its fraud
           assessment activities; and (3) using risk analysis to evaluate
           management alternatives to mitigate identified vulnerabilities.
         o Implement a mechanism to help USCIS ensure that information about
           fraud vulnerabilities uncovered during the course of normal
           operations-by USCIS and related agencies-feeds back into and
           contributes to changes in policies and procedures when needed to
           ensure that identified vulnerabilities result in appropriate
           corrective actions.
         o Communicate clearly to USCIS adjudicators the importance USCIS's
           fraud-prevention objectives and how they are to be balanced with
           service-oriented objectives to help adjudicators ensure that both
           objectives are supported as they carry out their duties.
         o Provide USCIS's adjudicator staff with access to relevant internal and
           external information that bears on their ability to detect fraud, make
           correct eligibility determinations, and support the new fraud referral
           process-particularly ongoing updates regarding fraud trends and other
           information related to fraud detection.
         o Establish output and outcome based performance goals-along with
           associated measures and targets-to assess the effectiveness of fraud
           control efforts and provide more complete performance information to
           guide management decisions about the need for any corrective action to
           improve the ability to detect fraud.

                           Agency Comments and Our Evaluation

    In addition, in order to enhance DHS's ability to sanction immigration
    benefit fraud, we recommend the Secretary of Homeland Security direct the
    Director of USCIS and the Assistant Secretary of ICE to:

    o  Develop a strategy for implementing a sanctions program that includes
    mechanisms for assessing its effectiveness and for determining its
    associated costs and benefits, including its deterrence value.

    We provided a draft of this report to the Departments of Homeland
    Security, State, Justice, and Labor for review. On March 1, 2006, we
    received written comments on the draft report from the Department of
    Homeland Security, which are reproduced in full in appendix II. The
    Departments of State, Justice, and Labor had no comments on our draft
    report. In its written comments, DHS stated that our report generally
    provided a good overview of the complexities associated with pursuing
    immigration benefit fraud and the need to have a program in place that
    proactively assesses vulnerabilities within the myriad of immigration
    processes. However, DHS stated that our report did not fully portray
    USCIS's efforts to address immigration benefit fraud and provided other
    examples of efforts USCIS has undertaken or plans to undertake. Where
    appropriate, we revised the draft report to recognize these additional
    efforts by USCIS to address immigration benefit fraud. DHS noted that
    USCIS used GAO's 2002 report on immigration benefit fraud as the
    foundation to build its antifraud program and believes that USCIS is on
    the right track to creating an effective antifraud program. We believe
    that USCIS is moving in the right direction and recognize that FDNS is in
    the beginning stages of developing and implementing a new antifraud
    program for USCIS.

    Overall, DHS agreed with and plans to take action to implement four of our
    six recommendations, and cited actions it has already taken to indicate
    that aspects of our other two recommendations are already in place.
    Specifically, regarding our recommendation that DHS enhance its risk
    management approach, DHS agreed that USCIS can enhance its risk management
    approach by expanding its fraud assessment program to cover more
    application types and plans to do so. DHS stated that its initial fraud
    assessments focused on benefits that were high risk, but that given
    existing resources it was not possible to conduct assessments on all
    benefit types within the first years of operation. DHS stated that USCIS
    believes that the benefit fraud assessments currently underway do provide
    a comprehensive risk analysis to identify vulnerabilities and measures to
    mitigate such vulnerabilities. DHS cites FDNS involvement in interagency
    anti-fraud efforts and that FDNS staff are assigned to various
    intelligence units as support that its fraud assessments draws on sources
    of strategic threat information. However, DHS did not provide evidence or
    explain how, if at all, these efforts systematically incorporated threat
    and consequences into its fraud assessment process. In addition, DHS did
    not explain or provide us with evidence of how USCIS will use the results
    of the fraud assessments as part of a continuous, built-in component of
    its operations to evaluate and adjust, as necessary, policies and
    procedures.

    Regarding our recommendation that DHS provide USCIS adjudicator staff
    relevant information, DHS agreed that it needs to provide USCIS staff
    access to relevant internal and external information and is initiating
    training for supervisory adjudication officers and is planning to provide
    adjudicators selective access to the State Department's Consolidated
    Consular Database and other open source databases.

    Regarding our recommendation that DHS establish performance goals to
    assess the effectiveness of fraud control efforts, DHS stated that FDNS
    has created performance goals for the number of benefit fraud assessments
    conducted during the year and the number of recommended policy, procedural
    and regulatory changes. DHS agreed that additional output and outcome
    based performance goals and measures are needed but did not specify what
    action(s) they were planning to take.

    Regarding our recommendation that DHS develop a strategy for implementing
    a sanctions program, DHS agreed to study the costs and benefits of an
    administrative sanctions program though DHS believes that the process it
    has established to place aliens determined to have committed immigration
    fraud in removal proceedings is an effective deterrent. While this process
    may deter aliens from committing immigration fraud, this process does not
    impact citizens who may commit fraud and therefore a sanctions strategy
    for citizens is still needed.

    DHS stated that with regard to two of our recommendations, it has already
    take actions that are consistent with these two recommendations. Regarding
    our recommendation that USCIS implement a mechanism to feed back
    information uncovered during the course of its normal operations and those
    of related agencies about fraud vulnerabilities, DHS stated that it
    believes such a feedback loop already exists within the process. DHS
    stated that FDNS is currently developing its back-end processes, which
    include sharing information/lessons learned from routine operations and
    addressing shortcomings. For all major conspiracy cases, a report is to be
    prepared summarizing among other things, factors that lead to fraudulent
    applications being approved. USCIS also stated that based upon meetings
    that FDNS leadership had with a U.S. Attorneys Office regarding
    vulnerabilities in the asylum process, USCIS is developing a plan of
    action to respond to the recommendations made by the U.S. Attorney's
    office. DHS also stated that USCIS is developing regulatory changes to
    mitigate vulnerabilities identified during the religious worker fraud
    assessment. Although these are all positive efforts, USCIS does not yet
    have policies and procedures that specify how information about fraud
    vulnerabilities uncovered during the course of normal operations-by USCIS
    and related agencies-is to be gathered-from which internal and external
    sources-and the process for evaluating this information and making
    decisions about appropriate corrective actions. Therefore, we continue to
    believe that USCIS needs to institutionalize through policies and
    procedures a feedback mechanism.

    Regarding our recommendation that USCIS clearly communicate the importance
    of USCIS' fraud-prevention activities, DHS stated USCIS leadership clearly
    advocates balancing objectives related to timely and quality processing of
    immigration benefits. DHS stated that creation of FDNS and the recent move
    of FDNS to a new directorate that reports directly to the Deputy Director
    of USCIS allowing FDNS to provide focus and guidance to all USCIS
    operations as support that USCIS is focused on the integrity of USCIS's
    data and processes. Although USCIS management believes these efforts
    demonstrate the importance of fraud prevention, our interviews with
    adjudicators in service centers and district offices indicate that this
    message may not be reaching USCIS's adjudications staff. Therefore, we
    continue to believe that more is needed to clearly communicate the
    importance of fraud prevention and more specific guidance on how USCIS
    staff are to balance the fraud prevention and service oriented objectives.
    DHS disagreed with our recommendation that USCIS and ICE establish a
    mechanism for the sharing of information related to the status and
    outcomes of USCIS fraud referrals to ICE. DHS provided us a February 2006
    memorandum of agreement between ICE and USCIS that establishes a mechanism
    for the sharing of information related to the status and outcomes of fraud
    referrals; therefore, we withdrew this recommendation.

    We are sending copies of this report to the Secretaries of Homeland
    Security, State, and Labor; the Attorney General; and other interested
    congressional committees. We will also make copies available to others
    upon request. In addition, the report will be available at no charge on
    GAO's Web site at http://www.gao.gov.

    Page 43 GAO-06-259 Immigration Benefits

    If you or your staff have any questions concerning this report, please
    contact me at (202) 512-8777 or Jonespl@gao.gov. Contact points for our
    Offices of Congressional Relations and Public Affairs may be found on the
    last page of this report. Key contributors to this report are listed in
    appendix III.

    Paul L. Jones Director, Homeland Security and Justice Issues

                           Appendix I: Scope and Methodology

    To examine the extent and nature of immigration fraud, we reviewed the
    results of the Office of Fraud Detection and National Security's (FDNS)
    ongoing fraud assessments. Regarding the fraud assessments, we interviewed
    the FDNS managers responsible for administering the assessment, reviewed
    documentation outlining the assessment's design, implementation and
    initial results from two fraud assessments. To better understand the
    nature of immigration benefit fraud and to identify common fraud patterns,
    we analyzed examples of fraud case histories for several petition types
    planned to be assessed by FDNS. In addition, we analyzed information
    contained in fraud bulletins prepared by U.S. Citizen Immigration
    Services' (USCIS) California Service Center that contained reports by
    various State Department overseas consular posts on immigration fraud
    these posts had uncovered. We also analyzed USCIS's Performance Analysis
    System (PAS) data to determine trends in the volume of applications being
    processed, approved, and denied. We assessed the data derived from PAS and
    determined that these data were sufficiently reliable for the purposes of
    this review. We interviewed adjudications staff and field managers to
    evaluate the extent to which internal controls and practices for detecting
    fraud were incorporated into USCIS policies, procedures, and tools. We met
    with headquarters officials from USCIS operations and FDNS, as well as
    officials from the Departments of Labor and State responsible for fraud
    detection efforts. We conducted site visits or contacted staff at all four
    USCIS services centers-we visited three USCIS service centers in Laguna
    Niguel, California; Dallas, Texas; and St. Albans, Vermont; and conducted
    telephone interviews with USCIS staff at the Lincoln, Nebraska, service
    center. We also interviewed 59 adjudicators at the four USCIS service
    centers and two USCIS district offices with responsibility for and
    familiarity with adjudicating different types of applications in a group
    setting, which allowed us to identify points of consensus among the
    adjudicators. We also visited USCIS district offices in Dallas and Boston
    responsible for coordinating their fraud referrals with two of the four
    service centers we visited. USCIS service center and district office
    officials selected the adjudicators we interviewed based upon our request
    that we meet with adjudicators that had responsibility for and familiarity
    with adjudicating different types of applications. We also interviewed
    FDNS staff assigned to work with the four service centers and two district
    offices we visited or contacted. We also interviewed staff from
    Immigration and Custom Enforcement's (ICE) Identity and Benefit Fraud Unit
    in Washington, D.C., and those agents assigned to Benefit Fraud Units
    (BFU) in California, Texas, and Vermont. As we did not select a
    probability sample of USCIS staff and ICE Office of Investigations agents
    to interview, the results of these interviews cannot be projected to all
    USCIS staff and

    Appendix I: Scope and Methodology

    ICE Office of Investigations officials nationwide. In addition, we
    reviewed efforts by the Department of Labor's Inspector General to
    determine the extent of immigration fraud in the Permanent Labor
    Certification Program. We also met with the CIS Ombudsman to discuss his
    fiscal year 2004 and fiscal year 2005 reports.

    To determine what actions USCIS has taken to improve its ability to detect
    immigration benefit fraud, we reviewed USCIS's efforts to improve its
    fraud detection capabilities, including resources devoted specifically to
    detecting fraud by FDNS. We also reviewed USCIS's policies, adjudication
    procedures, and fraud detection processes as well as the tools used by
    adjudicators to detect fraudulent immigration benefit applications. To
    determine what actions have been taken to sanction those who commit fraud,
    we interviewed USCIS and ICE attorneys, identified the investigative
    resources that ICE had made available for immigration fraud
    investigations, and determined how USCIS and ICE coordinate the
    investigation of potential fraud. In addition, we examined fraud
    investigation and prosecution statistics, and analyzed USCIS statistics
    about the amount of fraud identified by its adjudicators. We also
    determined how ICE investigative efforts are coordinated with the U.S.
    Attorneys Offices and how their priorities affect the investigation and
    prosecution of immigration benefit fraud schemes of various types. For
    this portion of our review, we met with headquarters officials from ICE,
    and interviewed agents in four ICE field offices based in Boston, Dallas,
    Los Angeles, and San Antonio. We also interviewed representatives from the
    U.S. Attorneys Office for the Eastern District of Virginia and the
    Executive Office of the U.S. Attorneys within the Department of Justice.
    Finally, we examined the current sanctions for those who commit
    immigration benefit fraud and reviewed proposed fraud regulatory changes.
    To evaluate DHS efforts to detect and sanction immigration benefit fraud,
    we used the Standards for Internal Control in the Federal Government and
    with best practices advocated by the American Institute of Certified
    Public Accountants (AICPA) and by the United Kingdom's National Audit
    Office (NAO).

    We conducted our work between October 2004 and December 2005 in accordance
    with generally accepted government auditing standards.

    Appendix II: Comments from the Department of Homeland Security

    Appendix II: Comments from the Department of Homeland Security

    Appendix II: Comments from the Department of Homeland Security

    Appendix II: Comments from the Department of Homeland Security

    Appendix II: Comments from the Department of Homeland Security

    Appendix III: GAO Contact and Staff Acknowledgments

    Paul L. Jones (202) 512-8777

      GAO Contact

    In addition to the above, Joel Aldape, David Alexander, Jenny Chanley,

      Staff

    Frances Cook, Michael P. Dino, Nancy Finley, Carlos Garcia, Kathryn
    Acknowledgements Godfrey, Larry Harrell, and David Nicholson were key
    contributors to this report.

    (440361)

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