Employment Verification: Challenges Exist in Implementing a	 
Mandatory Electronic Verification System (07-JUN-07,		 
GAO-07-924T).							 
                                                                 
The opportunity for employment is one of the most powerful	 
magnets attracting illegal immigration to the United States. The 
Immigration Reform and Control Act of 1986 established an	 
employment eligibility verification process, but immigration	 
experts state that a more reliable verification system is needed.
In 1996, the former U.S. Immigration and Naturalization Service, 
now within the Department of Homeland Security (DHS), and the	 
Social Security Administration (SSA) began operating a voluntary 
pilot program, called the Employment Eligibility Verification	 
(EEV) program, to provide participating employers with a means	 
for electronically verifying employees' work eligibility.	 
Congress is considering various immigration reform proposals,	 
some of which would require all employers to electronically	 
verify the work authorization status of their employees at the	 
time of hire. In this testimony GAO provides observations on the 
EEV system's capacity, data reliability, ability to detect	 
fraudulent documents and identity theft, and vulnerability to	 
employer fraud as well as challenges to making the program	 
mandatory for all employers. This testimony is based on our	 
previous work regarding the employment eligibility verification  
process and updated information obtained from DHS and SSA.	 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-07-924T					        
    ACCNO:   A70445						        
  TITLE:     Employment Verification: Challenges Exist in Implementing
a Mandatory Electronic Verification System			 
     DATE:   06/07/2007 
  SUBJECT:   Aliens						 
	     Data integrity					 
	     Databases						 
	     Employees						 
	     Employment 					 
	     Fraud						 
	     Identity verification				 
	     Immigration					 
	     Immigration information systems			 
	     Program evaluation 				 
	     Strategic planning 				 
	     System vulnerabilities				 
	     Employment Eligibility Verification		 
	     Program						 
                                                                 

******************************************************************
** This file contains an ASCII representation of the text of a  **
** GAO Product.                                                 **
**                                                              **
** No attempt has been made to display graphic images, although **
** figure captions are reproduced.  Tables are included, but    **
** may not resemble those in the printed version.               **
**                                                              **
** Please see the PDF (Portable Document Format) file, when     **
** available, for a complete electronic file of the printed     **
** document's contents.                                         **
**                                                              **
******************************************************************
GAO-07-924T

   

     * [1]Summary
     * [2]Background
     * [3]Mandatory EEV Would Require an Increase in Capacity at USCIS
     * [4]USCIS and SSA Are Exploring Options to Reduce Delays in the
     * [5]EEV May Help Reduce Employee Document Fraud, but Cannot Yet
     * [6]While Most Employers Complied with EEV Procedures, the Progr
     * [7]Concluding Observations
     * [8]GAO Contact and Staff Acknowledgements
     * [9]GAO's Mission
     * [10]Obtaining Copies of GAO Reports and Testimony

          * [11]Order by Mail or Phone

     * [12]To Report Fraud, Waste, and Abuse in Federal Programs
     * [13]Congressional Relations
     * [14]Public Affairs

Testimony before the Subcommittee on Social Security, Committee on Ways
and Means, House of Representatives

United States Government Accountability Office

GAO

For Release on Delivery
Expected at 10:00 a.m. EDT
Thursday, June 7, 2007

EMPLOYMENT VERIFICATION

Challenges Exist in Implementing a Mandatory Electronic Verification
System

Statement of Richard M. Stana, Director
Homeland Security and Justice Issues

GAO-07-924T

Mr. Chairman and Members of the Subcommittee:

I appreciate the opportunity to be here today to participate in this
hearing on electronic employment verification. As we and others have
reported in the past, the opportunity for employment is one of the most
powerful magnets attracting unauthorized immigrants to the United States.
To help address this issue, in 1986 Congress passed the Immigration Reform
and Control Act (IRCA),^1 which made it illegal for individuals and
entities to knowingly hire, continue to employ, or recruit or refer for a
fee unauthorized workers. The act established a two-pronged approach for
helping to limit the employment of unauthorized workers: (1) an employment
verification process through which employers verify all newly hired
employees' work eligibility and (2) a sanctions program for fining
employers who do not comply with the act.^2

Following the passage of IRCA, the U.S. Commission on Immigration Reform
and various immigration experts indicated a number of problems with the
implementation of immigration policies and concluded that deterring
illegal immigration requires, among other things, strategies that focus on
disrupting the ability of illegal immigrants to gain employment through a
more reliable employment eligibility verification process. In particular,
the commission report and other studies found that the single most
important step that could be taken to reduce unlawful migration is the
development of a more effective system for verifying work authorization.
In the over 20 years since passage of IRCA, the employment eligibility
verification process has remained largely unchanged. The House and Senate
are considering legislation to reform immigration laws and strengthen
electronic employment verification. Some of this legislation includes
proposals that would require implementing a mandatory, functional
electronic employment verification program for all employers before other
immigration-related reforms could be initiated. Currently, the U.S.
Citizenship and Immigration Services (USCIS) administers, and Social
Security Administration (SSA) supports, a voluntary electronic employment
verification program, called the Employment Eligibility Verification (EEV)
program.

^1Pub. L. No. 99-603, 8 U.S.C. S 1324a.

^2IRCA provided for sanctions against employers who do not follow the
employment verification (Form I-9) process. Employers who fail to properly
complete, retain, or present for inspection a Form I-9 may face civil or
administrative fines ranging from $110 to $1,100 for each employee for
whom the form was not properly completed, retained, or presented.
Employers who knowingly hire or continue to employ unauthorized aliens may
be fined from $275 to $11,000 for each employee, depending on whether the
violation is a first or subsequent offense. Employers who engage in a
pattern or practice of knowingly hiring or continuing to employ
unauthorized aliens are subject to criminal penalties consisting of fines
up to $3,000 per unauthorized employee and up to 6 months' imprisonment
for the entire pattern or practice.

My testimony today is an update of our prior work regarding employment
verification and worksite enforcement. Specifically, I will discuss our
observations on the current electronic employment verification program and
challenges to making the program mandatory for all employers.

In preparing this testimony, we reviewed our past work on employment
verification and worksite enforcement efforts.^3 We analyzed updated
information provided by U.S. Immigration and Customs Enforcement (ICE),
USCIS, and SSA officials on steps they are taking to address weaknesses
identified in our prior work, as well as challenges their agencies may
face if an electronic employment verification program were made mandatory.
We examined regulations, guidance, and other studies on the employment
verification process. We also analyzed a report on the results of an
independent evaluation of the electronic employment eligibility
verification program, then known as the Basic Pilot program, conducted by
the Institute for Survey Research at Temple University and Westat in June
2004.^4 Furthermore, we received updated data on employer use of the
current electronic employment eligibility verification system. We reviewed
these data for accuracy and completeness and determined that these data
were sufficiently reliable for the purposes of our review. We conducted
the work reflected in this statement from September 2004 through July 2005
and updated this information in May and June 2007 in accordance with
generally accepted government auditing standards.

Summary

A mandatory EEV would necessitate an increased capacity at both USCIS and
SSA to accommodate the estimated 5.9 million employers in the United
States.^5 As of May 2007, about 17,000 employers have registered for the
EEV program, about half of which are active users. USCIS has estimated
that a mandatory EEV could cost USCIS $70 million annually for program
management and $300 million to $400 million annually for compliance
activities and staff, depending on the method for implementing the
program. The costs associated with other programmatic and system
enhancements are currently unknown. SSA is currently refining its
estimates and was not yet able to provide estimates for the cost of a
mandatory EEV. According to SSA officials, the cost of a mandatory EEV
would be driven by the field offices' increased workload required to
resolve queries that SSA cannot immediately confirm.

^3GAO, Immigration Enforcement: Weaknesses Hinder Employment Verification
and Worksite Enforcement Efforts, [15]GAO-05-813 (Washington, D.C.: Aug.
31, 2005).

^4Institute for Survey Research and Westat, Findings of the Basic Pilot
Program Evaluation (Washington, D.C.: June 2004).

USCIS and SSA are exploring options to reduce delays in the EEV process.
According to USCIS, the majority of EEV queries entered by
employers--about 92 percent--confirm within seconds that the employee is
authorized to work. About 7 percent of the queries cannot be immediately
confirmed by SSA, and about 1 percent cannot be immediately confirmed by
USCIS. With regard to the SSA-issued tentative nonconfirmations,^6 USCIS
and SSA officials told us that the majority occur because employees'
citizenship or other information, such as name changes, is not up to date
in the SSA database. Resolving some DHS nonconfirmations can take several
days, or in a few cases even weeks. USCIS and SSA are examining ways to
improve the system's ability to use additional automated checks to
immediately confirm work authorization.

EEV may help reduce document fraud, but it cannot yet fully address
identity fraud issues, for example, when employees present borrowed or
stolen genuine documents. The current EEV program is piloting a photograph
screening tool, whereby an employer can more easily identify fraudulent
documentation. This tool is currently being used by over 70 employers, and
USCIS expects to expand the use of the tool to all participating employers
by the end of summer 2007. Although mandatory EEV and the associated use
of the photograph screening tool offer some remedy, further actions, such
as limiting the number of acceptable work authorization documents and
making them more secure, mat be required to more fully address identity
fraud.

^5In 2004, the most recent year for which data are available, there were
approximately 5.9 million firms in the United States. A firm is a business
organization consisting of one or more domestic establishments in the same
state and industry that were specified under common ownership or control.
Under EEV, one employer may have multiple worksites that use the system.
For example, a hotel chain could have multiple individual hotels using
EEV. This hotel chain would represent one employer using the pilot
program.

^6In general, in cases when the EEV system cannot confirm an employee's
work authorization status through the initial automatic check, the system
issues the employer either an SSA or a DHS tentative nonconfirmation of
the employee's work authorization status, which requires the employee to
resolve any data inaccuracies if he or she is able or chooses to do so.

EEV is vulnerable to employer fraud that diminishes its effectiveness and
misuse that adversely affects employees. ICE officials stated that EEV
program data could indicate cases in which employers may be fraudulently
using the system and therefore would help the agency better target its
limited worksite enforcement resources toward those employers. EEV is also
vulnerable to employer misuse that adversely affects employees, such as
limiting work assignments or pay while employees are undergoing the
verification process. USCIS is establishing a new Compliance and
Monitoring program to help reduce employer fraud and misuse by, for
example, identifying patterns in employer compliance with program
requirements. Information suggesting employers' fraud or misuse of the
system could be useful to other DHS components in targeting limited
worksite enforcement resources and promoting employer compliance with
employment laws.

Background

In 1986, IRCA established the employment verification process based on
employers' review of documents presented by employees to prove identity
and work eligibility. On the Form I-9, employees must attest that they are
U.S. citizens, lawfully admitted permanent residents, or aliens authorized
to work in the United States. Employers must then certify that they have
reviewed the documents presented by their employees to establish identity
and work eligibility and that the documents appear genuine and relate to
the individual presenting them. In making their certifications, employers
are expected to judge whether the documents presented are obviously
counterfeit or fraudulent. Employers generally are deemed in compliance
with IRCA if they have followed the Form I-9 process in good faith,
including when an unauthorized alien presents fraudulent documents that
appear genuine. Following the passage of IRCA in 1986, employees could
present 29 different documents to establish their identity and/or work
eligibility. In a 1997 interim rule, the former U.S. Immigration and
Naturalization Service (INS) reduced the number of acceptable work
eligibility documents from 29 to 27.^7

The Illegal Immigration Reform and Immigrant Responsibility Act (IIRIRA)^8
of 1996 required the former INS and SSA to operate three voluntary pilot
programs to test electronic means for employers to verify an employee's
eligibility to work, one of which was the Basic Pilot Program.^9 The Basic
Pilot Program was designed to test whether pilot verification procedures
could improve the existing employment verification process by reducing (1)
false claims of U.S. citizenship and document fraud, (2) discrimination
against employees, (3) violations of civil liberties and privacy, and (4)
the burden on employers to verify employees' work eligibility.

In 2007, USCIS renamed the Basic Pilot Program the Employment Eligibility
Verification (EEV) program. EEV provides participating employers with an
electronic method to verify their employees' work eligibility. Employers
may participate voluntarily in EEV, but are still required to complete
Forms I-9 for all newly hired employees in accordance with IRCA. After
completing the forms, these employers query EEV's automated system by
entering employee information provided on the forms, such as name and
Social Security number, into the EEV Web site within 3 working days of the
employees' hire date. The program then electronically matches that
information against information in SSA's NUMIDENT database and, for
noncitizens, DHS databases to determine whether the employee is eligible
to work. EEV electronically notifies employers whether their employees'
work authorization was confirmed. Those queries that the DHS automated
check cannot confirm are referred to DHS immigration status verifiers, who
check employee information against information in other DHS databases. The
EEV process is shown in figure 1.

^7Eight of these documents establish both identity and employment
eligibility (e.g., U.S. passport or permanent resident card); 12 documents
establish identity only (e.g., driver's license); and 7 documents
establish employment eligibility only (e.g., Social Security card).

^8U.S.C. 1324a(b). IIRIRA was enacted within a larger piece of
legislation, the Omnibus Consolidated Appropriations Act, 1997, Pub. L.
No. 104-208, 110 Stat. 3009.

^9The other two pilot programs mandated by IIRIRA--the Citizen Attestation
Verification Pilot Program and the Machine-Readable Document Pilot
Program--were discontinued in 2003 due to technical difficulties and
unintended consequences identified in evaluations of the programs. See
Institute for Survey Research and Westat, Findings of the Citizen
Attestation Verification Pilot Program Evaluation (Washington, D.C.: April
2003) and Institute for Survey Research and Westat, Findings of the
Machine-Readable Document Pilot Program Evaluation (Washington, D.C.: May
2003).

Figure 1: Electronic Employment Verification Program Verification Process

In cases when EEV cannot confirm an employee's work authorization status
either through the automatic check or the check by an immigration status
verifier, the system issues the employer a tentative nonconfirmation of
the employee's work authorization status. In this case, the employers must
notify the affected employees of the finding, and the employees have the
right to contest their tentative nonconfirmations by contacting SSA or
USCIS to resolve any inaccuracies in their records within 8 days. During
this time, employers may not take any adverse actions against those
employees, such as limiting their work assignments or pay. After 10 days,
employers are required to either immediately terminate the employment or
notify DHS of the continued employment of workers who do not successfully
contest the tentative nonconfirmation and those who the pilot program
finds are not work-authorized.

The EEV program is a part of USCIS's Systematic Alien Verification for
Entitlements Program, which provides a variety of verification services
for federal, state, and local government agencies. USCIS estimates that
there are more than 150,000 federal, state, and local agency users that
verify immigration status through the Systematic Alien Verification for

Entitlements Program. SSA also operates various verification services.
Among these are the Employee Verification Service (EVS) and the Web-based
SSN Verification Service (SSNVS), which can be used to provide
verification that employees' names and Social Security numbers match SSA's
records. These services, designed to ensure accurate employer wage
reporting, are offered free of charge. Employer use is voluntary, and the
services are not widely used.

Mandatory EEV Would Require an Increase in Capacity at USCIS and SSA

Mandatory electronic employment verification would substantially increase
the number of employers using the EEV system, which would place greater
demands on USCIS and SSA resources. As of May 2007, about 17,000 employers
have registered to use the program, 8,863 of which were active users,^10
and USCIS has estimated that employer registration is expected to greatly
increase by the end of fiscal year 2007. If participation in the EEV
program were made mandatory, the program may have to accommodate all of
the estimated 5.9 million employers in the United States. USCIS officials
estimate that to meet a December 2008 implementation date, this could
require about of 30,000 employers to register with the system per day. The
mandatory use EEV can affect the capacity of the system because of the
increased number of employer queries.

^10Active users are those employers who have run at least one query in
fiscal year 2007.

USCIS has estimated that a mandatory EEV could cost USCIS $70 million
annually for program management and $300 million to $400 million annually
for compliance activities and staff. The costs associated with other
programmatic and system enhancements are currently unknown. According to
USCIS, cost estimates will rise if the number of queries rises, although
officials noted that the estimates may depend on the method for
implementing a mandatory program. SSA officials told us they have
estimated that expansion of the EEV program to levels predicted by the end
of fiscal year 2007 would cost $5 to $6 million, but SSA was not yet able
to provide us estimates for the cost of a mandatory EEV. According to SSA
officials, the cost of a mandatory EEV would be driven by the increased
workload of its field office staff due to resolving SSA tentative
nonconfirmations.^11

A mandatory EEV would require an increase in the number of USCIS and SSA
staff to operate the program. For example, USCIS had 13 headquarters staff
members in 2005 to run the program and 38 immigration status verifiers
available for secondary verification.^12 USCIS plans to increase staff
levels to 255 to manage a mandatory program, which includes increasing the
number of immigration status verifiers who conduct secondary
verifications.^13 USCIS officials expressed concern about the difficulty
in hiring these staff due to lengthy hiring processes, which may include
government background checks. In addition, according to SSA officials, a
mandatory EEV program would require additional staff at SSA field offices
to accommodate an increase in the number of individuals visiting SSA field
offices to resolve tentative nonconfirmations. According to SSA officials,
the number of new staff required would depend on both the legislative
requirements for implementing mandatory EEV and the effectiveness of
efforts USCIS has under way to decrease the need for individuals to visit
SSA field offices. For this reason, SSA officials told us they have not
yet estimated how many additional staff they would need for a mandatory
EEV.

^11In general, in cases when the EEV system cannot confirm an employee's
work authorization status through the initial automatic check, the system
issues the employer a tentative nonconfirmation of the employee's work
authorization status.

^12 Thirty-eight immigration status verifiers were available for
completing secondary verifications. According to USCIS, at any one time
about 3 to 5 immigration status verifiers work to resolve tentative
nonconfirmations. The other immigration status verifiers work on other
verification programs, such as the Systematic Alien Verification for
Entitlements Program.

^13 USCIS officials noted that this does not include staff for monitoring
and compliance functions.

USCIS and SSA Are Exploring Options to Reduce Delays in the EEV Process

In prior work, we reported that secondary verifications lengthen the time
needed to complete the employment verification process. The majority of
EEV queries entered by employers--about 92 percent--confirm within seconds
that the employee is authorized to work. About 7 percent of the queries
are not confirmed by the initial automated check and result in SSA-issued
tentative nonconfirmations, while about 1 percent result in DHS-issued
tentative nonconfirmations. With regard to the SSA-issued tentative
nonconfirmations, USCIS and SSA officials told us that the majority occur
because employees' citizenship status or other information, such as name
changes, is not up to date in the SSA database. SSA does not update
records unless an individual requests the update in person and submits the
required evidence to support the change in its records. USCIS officials
stated that, for example, when aliens become naturalized citizens, their
citizenship status is often not updated in the SSA database. In addition,
individuals who have changed their names for various reasons, such as
marriage, without notifying SSA in person may also be issued an SSA
tentative nonconfirmation. According to SSA officials, although SSA
instructs individuals to report any changes in name, citizenship, or
immigration status, many do not do so. When these individuals' information
is queried through EEV, a tentative nonconfirmation would be issued,
requiring them to go to an SSA field office to show proof of the change
and to correct their records in SSA's database.

USCIS and SSA are exploring some options to improve the efficiency of the
verification process. For example, USCIS is exploring ways to
automatically check for naturalized citizens' work authorization using DHS
databases before the EEV system issues a tentative nonconfirmation.
Furthermore, USCIS is planning to provide naturalized citizens with the
option, on a voluntary basis, to provide their Alien Number or
Naturalization Certification Number so that employers can query that
information through the EEV system before referring the employees to SSA
to resolve tentative nonconfirmations.^14 SSA is also coordinating with
USCIS to develop an automated secondary verification capability, which may
reduce the need for employers to take additional steps after the employee
resolves the SSA tentative nonconfirmation.^15 USCIS and SSA officials
told us that the agencies are planning to provide SSA field office staff
with access to the EEV system so that field office staff can resolve the
SSA tentative nonconfirmation directly in the system at the time the
employee's record is updated at the field office. According to SSA
officials, the automated secondary verification capability is tentatively
scheduled to be implemented by October 2007. While these steps may help
improve the efficiency of the verification process, including eliminating
some SSA tentative nonconfirmations, they will not entirely eliminate the
need for some individuals to visit SSA field offices to update records
when individuals' status or other information changes.

^14According to USCIS, providing these data to employers would be
voluntary to help ensure that naturalized citizens are not subject to
discrimination.

USCIS and SSA officials noted that because the current EEV program is
voluntary, the percentage of individuals who are referred to SSA field
offices to resolve tentative nonconfirmations may not accurately indicate
the number of individuals who would be required to do so under a mandatory
program. SSA and USCIS officials expressed concern about the effect on SSA
field offices' workload of the number of individuals who would be required
to physically visit a field office if EEV were made mandatory.

EEV May Help Reduce Employee Document Fraud, but Cannot Yet Fully Address
Identity Fraud Issues

In our prior work, we reported that EEV enhances the ability of
participating employers to reliably verify their employees' work
eligibility and assists participating employers with identification of
false documents used to obtain employment. ^16 If newly hired employees
present false information, EEV would not confirm the employees' work
eligibility because their information, such as a false name or social
security number, would not match SSA and DHS database information.
However, the current EEV program is limited in its ability to help
employers detect identity fraud, such as cases in which an individual
presents borrowed or stolen genuine documents.

USCIS has taken steps to reduce fraud associated with the use of documents
containing valid information on which another photograph has been
substituted for the document's original photograph. In March 2007, USCIS
began piloting a photograph screening tool as an addition to the current
EEV system. According to USCIS officials, the photograph screening tool is
intended to allow an employer to verify the authenticity of a Lawful
Permanent Resident card (green card) or Employment Authorization Document
that contain photographs of the document holder by comparing individuals'
photographs on the documents presented during the I-9 process to those
maintained in DHS databases. As of May 2007, about 70 employers have been
participating during the pilot phase of the photograph screening tool, and
EEV has processed about 400 queries through the tool. USCIS expects to
expand the program to all employers participating in EEV by the end of
summer 2007.

^15Currently, once an individual resolves the reason for the SSA tentative
nonconfirmation, the employer must then re-query the EEV system in order
to finalize the verification.

^16 [16]GAO-05-813

The use of the photograph screening tool is currently limited because
newly hired citizens and noncitizens presenting forms of documentation
other than green cards or Employment Authorization Documents to verify
work eligibility are not subject to the tool. Expansion of the pilot
photograph screening tool would require incorporating other forms of
documentation with related databases. In addition, efforts to expand the
tool are still in the initial planning stages. For example, according to
USCIS officials, USCIS and the Department of State have begun exploring
ways to include visa and U.S. passport documents in the tool, but these
agencies have not yet reached agreement regarding the use of these
documents. USCIS is also exploring a possible pilot program with state
Departments of Motor Vehicles.

In prior work we reported that although not specifically or
comprehensively quantifiable, the prevalence of identify fraud seemed to
be increasing, a development that may affect employers' ability to
reliably verify employment eligibility in a mandatory EEV program. The
large number and variety of acceptable work authorization documents--27
under the current employment verification process--along with inherent
vulnerabilities to counterfeiting of some of these documents, may
complicate efforts to address identity fraud. Although mandatory EEV and
the associated use of the photograph screening tool offers some remedy,
further actions, such as reducing the number of acceptable work
eligibility documents and making them more secure, may be required to more
fully address identity fraud.

While Most Employers Complied with EEV Procedures, the Program Is Vulnerable to
Employer Fraud That Diminishes Its Effectiveness and Misuse That Adversely
Affects Employees

EEV is vulnerable to acts of employer fraud, such as entering the same
identity information to authorize multiple workers. Although ICE has no
direct role in monitoring employer use of EEV and does not have direct
access to program information, which is maintained by USCIS, ICE officials
told us that program data could indicate cases in which employers may be
fraudulently using the system and therefore would help the agency better
target its limited worksite enforcement resources toward those employers.
ICE officials noted that, in a few cases, they have requested and received
EEV data from USCIS on specific employers who participate in the program
and are under ICE investigation. USCIS is planning to use its newly
created Compliance and Monitoring program to refer information on
employers who may be fraudulently using the EEV system, although USCIS and
ICE are still determining what information is appropriate to share.

Employees queried through EEV may be adversely affected if employers
violate program obligations designed to protect the employees, by taking
actions such as limiting work assignments or pay while employees are
undergoing the verification process. The 2004 Temple University Institute
for Survey Research and Westat evaluation of EEV concluded that the
majority of employers surveyed appeared to be in compliance with EEV
procedures. However, the evaluation and our prior review found evidence of
some noncompliance with these procedures. In 2005, we reported that EEV
provided a variety of reports that could help USCIS determine whether
employers followed program requirements, but that USCIS lacked sufficient
staff to do so. Since then, USCIS has added staff to its verification
office and created a Compliance and Monitoring program to review
employers' use of the EEV system. However, while USCIS has hired directors
for these functions, the program is not yet fully staffed. According to
USCIS officials, USCIS is still in the process of determining how this
program will carry out compliance and monitoring functions, but its
activities may include sampling employer usage data for evidence of
noncompliant practices, such as identifying employers who do not appear to
refer employees contesting tentative nonconfirmations to SSA or USCIS.
USCIS estimates that the Compliance and Monitoring program will be
sufficiently staffed to begin identifying employer noncompliance by late
summer 2007.

USCIS's newly created Compliance and Monitoring program could help ICE
better target its worksite enforcement efforts by indicating cases of
employers' egregious misuse of the system. Currently, there is no formal
mechanism for sharing compliance data between USCIS and ICE. ICE officials
noted that proactive reduction of illegal employment through the use of
functional, mandatory EEV may help reduce the need for and better focus
worksite enforcement efforts. Moreover, these officials told us that
mandatory use of an automated system like EEV could limit the ability of
employers who knowingly hired unauthorized workers to claim that the
workers presented false documents to obtain employment, which could assist
ICE agents in proving employer violations of IRCA.

Concluding Observations

Although efforts to reduce the employment of unauthorized workers in the
United States necessitate a strong employment eligibility verification
process and a credible worksite enforcement program and other immigration
reforms may be dependent on it, a number of challenges face its successful
implementation. The EEV program shows promise for enhancing the employment
verification process and reducing document fraud if implemented on a much
larger scale, and USCIS and SSA have undertaken a number of steps to
address many of the weaknesses we identified in the EEV program. USCIS has
also spent the last several years planning for an expanded or mandatory
program, and has made progress in several areas, but it is unclear at this
time the extent to which USCIC's efforts will be successful under
mandatory EEV. It is clear, however, that a mandatory EEV system will
require a substantial investment in staff and other resources, at least in
the near term, in both agencies. There are also issues, such as identity
fraud and intentional misuse, that will remain a challenge to the system.
Implementing an EEV system to ensure that all individuals working in this
country are doing so legally and that undue burdens are not placed on
employers or employees will not be an easy task within the timelines
suggested in reform proposals.

This concludes my prepared statement. I would be pleased to answer any
questions you and the subcommittee members may have.

GAO Contact and Staff Acknowledgements

For further information about this testimony, please contact Richard Stana
at 202-512-8777.

Other key contributors to this statement were Blake Ainsworth, Frances
Cook, Michelle Cooper, Rebecca Gambler, Kathryn Godfrey, Lara Laufer,
Shawn Mongin, Justin L. Monroe, John Vocino, Robert E. White, and Paul
Wright.

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.

GAO's Mission

The Government Accountability Office, the audit, evaluation and
investigative arm of Congress, exists to support Congress in meeting its
constitutional responsibilities and to help improve the performance and
accountability of the federal government for the American people. GAO
examines the use of public funds; evaluates federal programs and policies;
and provides analyses, recommendations, and other assistance to help
Congress make informed oversight, policy, and funding decisions. GAO's
commitment to good government is reflected in its core values of
accountability, integrity, and reliability.

Obtaining Copies of GAO Reports and Testimony

The fastest and easiest way to obtain copies of GAO documents at no cost
is through GAO's Web site ( [17]www.gao.gov ). Each weekday, GAO posts
newly released reports, testimony, and correspondence on its Web site. To
have GAO e-mail you a list of newly posted products every afternoon, go to
[18]www.gao.gov and select "Subscribe to Updates."

Order by Mail or Phone

The first copy of each printed report is free. Additional copies are $2
each. A check or money order should be made out to the Superintendent of
Documents. GAO also accepts VISA and Mastercard. Orders for 100 or more
copies mailed to a single address are discounted 25 percent. Orders should
be sent to:

U.S. Government Accountability Office 441 G Street NW, Room LM Washington,
D.C. 20548

To order by Phone: Voice: (202) 512-6000 TDD:
(202) 512-2537
Fax: (202) 512-6061

To Report Fraud, Waste, and Abuse in Federal Programs

Contact:

Web site: [19]www.gao.gov/fraudnet/fraudnet.htm
E-mail: [20][email protected]
Automated answering system: (800) 424-5454 or (202) 512-7470

Congressional Relations

Gloria Jarmon, Managing Director, [21][email protected] (202) 512-4400 U.S.
Government Accountability Office, 441 G Street NW, Room 7125 Washington,
D.C. 20548

Public Affairs

Paul Anderson, Managing Director, [22][email protected] (202) 512-4800
U.S. Government Accountability Office, 441 G Street NW, Room 7149
Washington, D.C. 20548

www.gao.gov/cgi-bin/getrpt?GAO-07-924T .

To view the full product, including the scope
and methodology, click on the link above.

For more information, contact Richard M. Stana at (202) 512-8777 or
[email protected].

Highlights of [24]GAO-07-924T , a testimony before the Subcommittee on
Social Security, Committee on Ways and Means, House of Representatives

June 7, 2007

EMPLOYMENT VERIFICATION

Challenges Exist in Implementing a Mandatory Electronic Verification
System

The opportunity for employment is one of the most powerful magnets
attracting illegal immigration to the United States. The Immigration
Reform and Control Act of 1986 established an employment eligibility
verification process, but immigration experts state that a more reliable
verification system is needed. In 1996, the former U.S. Immigration and
Naturalization Service, now within the Department of Homeland Security
(DHS), and the Social Security Administration (SSA) began operating a
voluntary pilot program, called the Employment Eligibility Verification
(EEV) program, to provide participating employers with a means for
electronically verifying employees' work eligibility. Congress is
considering various immigration reform proposals, some of which would
require all employers to electronically verify the work authorization
status of their employees at the time of hire. In this testimony GAO
provides observations on the EEV system's capacity, data reliability,
ability to detect fraudulent documents and identity theft, and
vulnerability to employer fraud as well as challenges to making the
program mandatory for all employers. This testimony is based on our
previous work regarding the employment eligibility verification process
and updated information obtained from DHS and SSA.

A mandatory EEV program would substantially increase the number of
employers using the system. As of May 2007, about 17,000 employers have
registered to use the current voluntary EEV program, about half of which
are active users. If participation in EEV were made mandatory, the
approximately 5.9 million employers in the United States may be required
to participate. Requiring all employers to use EEV would substantially
increase the demands on DHS and SSA resources. DHS estimated that
increasing the capacity of EEV could cost it $70 million annually for
program management and $300 million to $400 million annually for
compliance activities and staff. SSA officials estimated that expansion of
the EEV program through this fiscal year would cost $5 million to $6
million and noted that the cost of mandatory EEV would be much higher and
driven by increased workload of its field office staff that would be
responsible for resolving queries that SSA cannot immediately confirm.

DHS and SSA are exploring options to reduce delays in the EEV process. The
majority of EEV queries entered by employers--about 92 percent--confirm
within seconds that the employee is work authorized. About 7 percent of
the queries cannot be immediately confirmed by SSA, and about 1 percent
cannot be immediately confirmed by DHS. Resolving these nonconfirmations
can take several days, or in a few cases even weeks. DHS and SSA are
considering options for improving the system's ability to perform
additional automated checks to immediately confirm work authorization,
which may be important should EEV be mandatory.

EEV may help reduce document fraud, but it cannot yet fully address
identity fraud issues, for example, when employees present borrowed or
stolen genuine documents. The current EEV program is piloting a photograph
screening tool, whereby an employer can more easily identify fraudulent
documentation. DHS expects to expand the use of this tool to all
participating employers by September 2007. Although mandatory EEV and the
associated use of the photograph screening tool offer some remedy,
limiting the number of acceptable work authorization documents and making
them more secure would help to more fully address identity fraud.

The EEV program is vulnerable to employer fraud, such as entering the same
identity information to authorize multiple workers. EEV is also vulnerable
to employer misuse that adversely affects employees, such as employers
limiting work assignments or pay while employees are undergoing the
verification process. DHS is establishing a new Compliance and Monitoring
program to help reduce employer fraud and misuse by, for example,
identifying patterns in employer compliance with program requirements.
Information suggesting employers' fraud or misuse of the system could be
useful to other DHS components in targeting limited worksite enforcement
resources and promoting employer compliance with employment laws.

References

Visible links
  15. http://www.gao.gov/cgi-bin/getrpt?GAO-05-813
  16. http://www.gao.gov/cgi-bin/getrpt?GAO-05-813
  17. http://www.gao.gov/
  18. http://www.gao.gov/
  19. http://www.gao.gov/fraudnet/fraudnet.htm
  20. mailto:[email protected]
  21. mailto:[email protected]
  22. mailto:[email protected]
  23. http://www.gao.gov/cgi-bin/getrpt?GAO-07-924T
  24. http://www.gao.gov/cgi-bin/getrpt?GAO-07-924T
*** End of document. ***