CHAIRMAN JOHNSON ANNOUNCES HEARING ON THE SOCIAL SECURITY ADMINISTRATION’S ROLE IN VERIFYING EMPLOYMENT ELIGIBILITY _______________ BEFORE THE SUBCOMMITTEE ON SOCIAL SECURITY OF THE COMMITTEE ON WAYS AND MEANS U.S. HOUSE OF REPRESENTATIVES ONE HUNDRED TWELFTH CONGRESS FIRST SESSION ______________ April 14, 2011 _________________ SERIAL 112-SS3 _______________ Printed for the use of the Committee on Ways and Means

COMMITTEE ON WAYS AND MEANS   SUBCOMMITTEE ON SOCIAL SECURITY SAM JOHNSON, Texas, Chairman
KEVIN BRADY, Texas PAT TIBERI, Ohio AARON SCHOCK, Illinois ERIC PAULSEN, Minnesota RICK BERG, North Dakota ADRIAN SMITH, Nebraska	XAVIER BECERRA, California LLOYD DOGGETT, Texas SHELLEY BERKLEY, Nevada FORTNEY PETE STARK, California

The subcommittee met, pursuant to call, at 2:06 p.m., in Room B‑318, Rayburn House Office Building, Hon. Sam Johnson [chairman of the subcommittee] presiding.

[The advisory of the hearing follows:]

_________________________________________________________

Chairman Johnson.  The subcommittee will come to order.  Welcome, everyone. 

Employers are on the front lines of ensuring a legal workforce, and it is a battle for these employers.  Consider for a moment that due to our broken immigration enforcement system, the Pew Hispanic Center estimates there are over 8 million illegal workers in this country.  With unemployment around 9 percent, these illegal workers often compete with lawful citizens for much‑needed jobs. 

Today’s hearing will examine the employment verification systems available for employers’ use, including E‑Verify, the largely voluntary system jointly administered by Social Security and Homeland Security.  Since our last hearing on this subject nearly 3 years ago, the use of E‑Verify has expanded.  Today there are over 250,000 employers.  That is about 4 percent is all of all U.S. employers registered to use the system.  In addition, the use of E‑Verify has been mandated in three States, and for the Federal Government, and certain Federal contractors and subcontractors. 

Social Security is an integral partner in E‑Verify because it has the only database that can confirm citizenship.  I want to make clear, however, I am very uncomfortable that Homeland Security is checking on U.S. citizens.  That said, Social Security and Homeland Security have, to their credit, worked together to make E‑Verify more workable and more accurate.  However, as we shall hear shortly from the Government Accountability Office, E‑Verify remains vulnerable to identity theft and to employer fraud. 

As my Texas colleague and chairman of the Judiciary Committee, Lamar Smith, has said, perhaps the most valid criticism of E‑Verify is the identity theft loophole.  And I couldn’t agree more.  If an employee presents a stolen Social Security number and fraudulent photo ID, E‑Verify will erroneously indicate that the individual is authorized to work.  The employer has been duped, and an innocent American may face years of financial and legal woe because his identity has been stolen. 

To build on the successes of E‑Verify while making needed adjustments to ensure successful implementation, last Congress I introduced H.R. 5515, the New Employee Verification Act, or NEVA.  NEVA would achieve three important goals:  One, ensure a legal workforce, safeguard workers’ identities, and protect Social Security. 

It is true that Congress gave the American people an employment verification system that works while protecting Social Security’s ability to serve the public.  I would hope that this is one immigration‑related issue where both sides could find common ground.  As we move forward, we must carefully consider the potential burdens to Social Security and, most importantly, to workers and employers struggling in these trying times to get Americans working again. 

I appreciate all of you all being here.  I think that we are going to have a good panel today, and I thank you for joining us.  So I look forward to hearing our expert testimony from all of you. 

Chairman Johnson.  And I now recognize my friend and the ranking member, Xavier Becerra, for his opening remarks. 

Mr. Becerra.  Mr. Chairman, thank you for calling today’s hearing to examine the impact of electronic employment verification eligibility verification systems and the impact it has on the Social Security Administration (SSA) and on our workers in the United States. 

The Social Security Administration has played a critical role in the verification of our workforce since 1997, when the basic pilot program began, which is now, of course, known as E‑Verify.  Today the majority of employees who are checked through E‑Verify are cleared fairly quickly; however, some workers are not.  Our witnesses today will describe what happens to a worker when they receive a tentative nonconfirmation that the information submitted by their employer does not match information contained on government databases. 

A recent Government Accountability Office (GAO) report concluded that individuals often face significant difficulties in resolving nonconfirmations.  This is not a trivial matter because the inability to resolve an erroneous nonconfirmation can lead to loss of a job. 

In addition, I am deeply troubled to learn that many employers do not comply with E‑Verify program rules designed to prevent discrimination or abuse of the system.  In this downturned economy, one job loss due to mechanical or technical error or employer noncompliance with E‑Verify requirements is one job lost too many. 

Mr. Chairman, at this time, I would like to submit into the record the stories of Americans who have suffered greatly from problems with E‑Verify.  These illustrate the kinds of challenges U.S. citizens and legally authorized workers face in keeping their jobs. 

Chairman Johnson.  Without objection. 

Mr. Becerra.  Thank you.

Mr. Becerra.  Many would like to expand the E‑Verify system, but we should not do so unless we first address the kinds of problems with the existing system that is identified in today’s hearing.  In addition, to be able to meet the needs of this growing program, more research has to be dedicated to it. 

While some have proposed making E‑Verify a permanent, mandatory program, the Congressional Budget Office has estimated that this would cost the taxpayers nearly $18 billion over the next 10 years. 

As we work forward and make progress in trying to improve this program, the ultimate solution to what we are trying to address through E‑Verify is to reform our broken immigration system.  In places like Arizona, where E‑Verify is mandatory, some employers have resorted to paying their employees under the table or have simply just stopped complying with the program.  The State has also seen a loss of income tax revenue, confirming predictions that mandatory E‑Verify in the absence of immigration reform simply drives employees into the underground economy. 

Chairman Johnson, I look forward to working together to jointly improve our electronic employment verification system, and I thank you for calling today’s hearing. 

Chairman Johnson.  Thank you, sir. 

Today we are joined by five witnesses.  Our first witness will be Richard Stana, Director of Homeland Security and Justice, United States Government Accountability Office.  Next is Marianna LaCanfora, Assistant Deputy Commissioner, Office of Retirement and Disability Policies, Social Security Administration.  Next is Tyler Moran, Policy Director, National Immigration Law Center.  Next is Ana Anton, Ph.D. professor, Department of Computer Science, College of Engineering, North Carolina State University, on behalf of the Association for Computing Machinery.  And finally, Austin Fragomen, Chairman of the Board of Directors of the American Council on International Personnel, on behalf of the HR Initiative for a Legal Workforce. 

I welcome all of you, and we look forward to hearing your testimony.  Each witness will have 5 minutes, and your written statements will be made part of the record in the event that you run over a little.  So I thank you, and I welcome you. 

And thank you, Mr. Stana.  You are recognized for 5 minutes. 

STATEMENT OF RICHARD M. STANA, DIRECTOR, HOMELAND SECURITY AND JUSTICE, UNITED STATES GOVERNMENT ACCOUNTABILITY OFFICE

Mr. Stana.  Thank you, Mr. Chairman.  Thank you, Mr. Becerra and members of the subcommittee.  I am pleased to be here today to discuss the results of our work on E‑Verify, which is a voluntary program that can be used to verify the work authorization of newly hired employees. 

I would like to discuss three points from our report, and then later I would like to briefly discuss some issues that may be of interest to the subcommittee on how it would affect the Social Security Administration. 

First let us discuss the TNCs, the tentative nonconfirmations.  The USCIS has substantially reduced the number of TNCs from about 8 percent of all queries just a few years ago to 2.6 percent in fiscal year 2009, which was the subject of our study, down to 1.7 percent last year.  So that is moving in the right direction.  This was done by expanding the number of databases that are queried.  They now look at naturalization databases, and they look at passport data. USCIS also screens for common data entry errors like transpositions or a European date format that can be easily fixed.  But erroneous TNCs continue to occur when employee names are misspelled, or they are transposed, or people with multiple surnames use different surnames in one document than they use in another document, and thus it triggers a TNC. 

Erroneous final nonconfirmations can occur when SSA field office staff do not update the EV‑STAR system, which is an information system on workers who receive SSA TNCs, but SSA is addressing this issue, so we hope that this will be resolved soon. 

Mr. Becerra.  Mr. Stana, we ask that you, instead of using the acronyms, mention the names of these programs, because a lot of folks who might be watching may not understand what a TNC and all those other things are.

Mr. Stana.  Okay.  Thank you. 

An FNC is a final nonconfirmation, which is the final notice that you are not confirmed.  It is not redressable.  In other words, there is no appeal mechanism for that, which may get to the issue you both were talking about with Americans who are work‑authorized but get a bad shake out of the system. 

So improving government data sets, increasing employee awareness, and making sure employees have a sufficient amount of time to redress the TNC notices is really what is needed here. 

Now, I would like to turn briefly to the issue of identity theft that both of you have mentioned.  This is a very important issue, and it is one that the system has not been able to address. Identity theft can occur if I were not work‑authorized and would use another person’s identity to say that my Social Security number is this, and my driver’s license number is this, and the E-Verify system says I am work‑authorized when I am really not. 

Westat did a study on E-Verify a couple of years ago.  They found that about 3 percent of the confirmed work‑authorized people really aren’t.  In other words, it creates a false positive.  And sometimes this is done by individual workers getting an identity that works.  Sometimes it is done with the complicity of the employer; the employer says these documents are valid, let us enter these into the E-Verify system, and we will put you on our payroll. 

USCIS has taken a number of steps to try to address this, like a photo‑matching tool for 3 of the 26 documents you can use to validate your authorization to work in the United States.  But again, this whole system hinges on the integrity of the employer.  The employer looks at the photo on the screen, looks at the photo that you present, or looks at the person who is before them and either says it is or it is not a match.  So that is an issue that they have to work on a little bit more, finding a key to unlocking the identity theft issue. 

Turning to some of the discrimination issues, there is concern that people who have hyphenated names may get a bad shake out of the system, or people who have hyphenated names may encounter certain challenges that those of us who don’t do not.  They may order their names in a certain sequence differently on different documents.  It is not against the law to do that, but it is going to trigger a tentative nonconfirmation. 

USCIS has a monitoring and compliance unit that they use to try to identify discriminatory behaviors among employees, such as seeing if a person is not given work assignments or reduced pay until a final confirmation comes through.  This is against the law.  But again, with about 80 people across the country in this unitand no on‑site inspection ‑‑ I take that back.  There was one at the Social Security Administration ‑‑ it is difficult to determine whether discriminating behavior exists. 

My last point from our report involves resources.  Like the I‑9 system, unless the E‑Verify system is properly resourced, it is not likely to work well.  This is because you have to have someone on site to make sure that the system is properly used and, to the extent possible, to make sure that identity theft is minimized or eliminated.  USCIS has to rely on ICE for investigating, sanctioning and seeking prosecution of noncompliant employers, but given its priorities, ICE is not likely to devote many resources to this area.  So policy decisions are going to have to be made on how many resources the Congress wishes ICE to put into worksite enforcement. 

Lastly, I’d like to discuss E-Verify’s impacts on SSA.  First, to the extent that SSA staff needs to resolve tentative nonconfirmations, it does take time away from other duties.  When the TNC rate goes down from 8 to 1.7 percent, that is helpful.  If we go to a mandatory system, we may need more resources so it does not adversely impact the SSA workload. 

The other thing that could impact the SSA workload is the self‑check system, where an employee or potential employee like you or me could query a system to see if the system would identify us as work‑authorized.  It is new.  It is being piloted.  While the pilot is ongoing, it doesn’t now seem to be stressing the SSA workload too much.  If it becomes mandatory, or if the pilot is expanded nationwide, it could have an effect.  But I will let the Social Security Administration discuss ant adverse impact. 

That concludes my statement.  I will be happy to answer any questions. 

Chairman Johnson.  Thank you, sir. 

[The statement of Mr. Stana follows:]

Chairman Johnson.  Ms. LaCanfora, you are recognized for 5 minutes. 

STATEMENT OF MARIANNA LACANFORA, ASSISTANT DEPUTY COMMISSIONER, OFFICE OF RETIREMENT AND DISABILITY POLICY, SOCIAL SECURITY ADMINISTRATION

Ms. LaCanfora.  Thank you.  Chairman Johnson, Ranking Member Becerra and members of the subcommittee, thank you for the opportunity to discuss SSA’s supporting role in E‑Verify, DHS’s electronic employment eligibility verification system.  I would like to start by briefly describing the purpose of our Social Security numbers, or SSNs. 

Assigning SSNs is key to administering Social Security programs.  We establish the SSN as a way for employers to report an employee’s earnings accurately.  We use the SSN to credit wages to the earnings record that we maintain for each worker.  The earnings record is the basis for determining eligibility for, and the amount of, Social Security benefits. 

The SSN also plays a key role in E‑Verify.  By law, all employers are required to verify the identity and employment eligibility of new employees.  E‑Verify is a voluntary, electronic tool that employers can use to comply with the law.  When an employer submits information about a new hire, DHS sends this information to us electronically to verify the SSN, the name and the date of birth in our records.  For new hires alleging U.S. citizenship, we also confirm citizenship based on the information that we have in our records.  For any naturalized citizen whose U.S. citizenship we cannot confirm using our records, DHS verifies naturalization and thus the authorization to work.  For noncitizens, if there is a match with our records, DHS will then determine the current work authorization status.  DHS notifies the employer of the results of these verifications. 

So far this fiscal year, we have handled about 7.5 million queries.  In fiscal year 2010, E‑Verify handled over 16.5 million queries and automatically confirmed work authorization in about 98 percent of these queries instantly or within 24 hours.  The remaining 2 percent received an initial systems mismatch.  We call that a tentative nonconfirmation.  Of that 2 percent, just under half contacted us at Social Security to resolve the mismatch. 

When an individual comes into one of our offices with a tentative nonconfirmation, we work to resolve the discrepancy.  For example, the person may need to change their name in our records due to a marriage or a divorce that they had not previously reported to us. 

It is important to note that we need to verify the identity of any individual whose record we update.  That is why we must process almost all of these updates during face‑to‑face interviews in our local offices.  In some cases we may be unable to resolve the discrepancy the same day because the individual may need to obtain evidence, such as a marriage certificate. 

We use EV‑STAR, which is a Web‑based portal, to update the E‑Verify system with the status of a pending case.  Once we resolve the discrepancy by updating our records, or by determining that our records should not be changed, we again update EV‑STAR to show the outcome of the case.  The employer can check E‑Verify for the status of the case and see the final confirmation or nonconfirmation. 

We have worked with the DHS over the last few years to improve the E‑Verify system.  For example, in 2009, we completed a significant improvement to our computer systems that support E‑Verify.  This improved system ensures that there is no interference between our mission‑critical workloads and DHS’s E‑Verify program.  At the request of DHS, we designed the system to handle up to 60 million queries per year.  With additional hardware and funding, we could increase our capacity if the need arises.  Even with this and other improvements we remain focused on further reducing the need for workers to visit our local offices. 

Each year DHS provides funds to cover our E‑Verify‑related costs.  Our costs include systems maintenance costs and the cost of assisting individuals to resolve the tentative nonconfirmations.  Receiving timely and adequate reimbursement from DHS for E‑Verify is critical. 

In conclusion, I thank you for giving me this opportunity to discuss our role in assisting DHS to administer the E‑Verify system.  I would be happy to answer any questions you may have. 

Chairman Johnson.  Thank you, ma’am. 

[The statement of Ms. LaCanfora follows:]

Chairman Johnson.  Ms. Moran, welcome.  You are recognized for 5 minutes.
 
STATEMENT OF TYLER MORAN, POLICY DIRECTOR, NATIONAL IMMIGRATION LAW CENTER
 

Ms. Moran.  Thank you.  Good afternoon, Chairman Johnson, Ranking Member Becerra and members of the committee.  Thank you for the opportunity to testify on E‑Verify.  The National Immigration Law Center has worked on E‑Verify since it was implemented in 1997, and I have personally advocated for improvements in this program for almost a decade. 

E‑Verify faces a number of challenges despite the progress that it has made, and these challenges would be greatly exacerbated if this program is made mandatory.  That is why it is particularly troubling that there may be a bill in the House this year to make this program mandatory, because it almost certainly would pass.  According to the Congressional Budget Office, a mandatory E-Verify bill would result in over $17 billion in tax losses because undocumented workers would not leave the country.  They and their employers who are currently paying taxes would simply go underground to get around the system. 

SSA also testified in 2007 that over 3 million workers would have to go to SSA to stand in line and correct database errors or lose their jobs.  And this is a system, as Mr. Stana has testified, that doesn’t detect half of undocumented workers. 

Additionally, if a mandatory system is put on line without legalizing the 8 million undocumented workers in our economy, it is going to set the system up for failure, not to mention to decimate industries like agriculture. 

I want to start by addressing the error rate.  The 98 percent confirmation rate sounds very impressive, and there have been a lot of improvements to the programs.  But I think it is more helpful to talk about the number of workers affected versus the percentage. Using Westat’s conservative estimates, in the mandatory system, 1.2 million people would have to stand in line at SSA to correct their records or lose their jobs, and 770,000 people would likely lose their jobs.  This is an underestimate because every employer that has audited, their own data comes up with higher error rates.  For example, when Los Angeles County audited its use of E-Verify, it found on the low end that 2 percent of SSA TNCs were erroneous. To make this really concrete, a 2 percent error rate in Texas would mean 244,000 people going to SSA or losing their jobs.  And in California that would mean 362,000 people- 78,000 alone in L.A. going to only 7 SSA offices. 

So these are future projections, but using Westat’s statistics in fiscal year 2010 alone, 80,000 U.S. citizens and lawful immigrants lost their jobs.  Jessica, a native‑born U.S. citizen from southern Florida, is one of those people who called our office.  She got a job offer that she accepted at a good‑paying telecommunications company.  They told her she got a TNC.  She went to SSA.  She provided the documentation.  They said, you are all set, and provided her with paperwork that her name and SSN matched.  She went back to her employer, who at first said okay.  Three days later they said, I am sorry, you got a final nonconfirmation, we are going to have to fire you.  She went back to SSA, waited in line and said, I thought it was okay.  They said it is okay.  She went back to the employer and the employer said, I am sorry.  She was very frustrated.  She called USCIS, DHS, and finally called us.  She was out of work for 3 months, including over the Christmas holiday.  And she now has a lower‑paying job. 

The worst part about this is that there is no due process in the system, and there is nothing we can do for Jessica to get back her wages or to get back her job.  So it is important to note that Jessica is not the only one that faces these challenges at SSA.  People have to take off time from work.  It takes costs them money and often they have to go back multiple times. 

I want to highlight Arizona because I think it is a good window into what a mandatory system could look like without legalizing undocumented workers.  Arizona is the first State to make E‑Verify mandatory, and there is three main takeaways.  One, undocumented workers didn’t leave the State, they didn’t leave the country; they went into the underground economy, or they are now popping up as independent contractors.  Number two, employers are coaching workers how to get around the system.  And number three, despite penalties and mandates, half of employers aren’t even using it.  So you might think this is all worth it if the system works.  But again, 54 percent of undocumented workers aren’t detected by the system. 

So what are the solutions?  As I said in my opening statement, E‑Verify has made a number of improvements, but it is just not ready for prime time.  If and when Congress decides to make this program mandatory, there are a number of policies that have to accompany it, and they are in my written testimony, but I want to highlight three. 

Number one, it has to be paired with a path to legal status for the 8 million undocumented workers.  People aren’t going to pack their bags because of E‑Verify.  They are going to stay here, and there are going to be major repercussions for the economy. 

Number two, we have to create due process so people have a way to challenge these errors, and that they get back pay if they lose their jobs.  We have 9 percent unemployment.  We can’t have 1 million workers losing their jobs. 

And number three, you should phase in E‑Verify with performance evaluations along the way for database accuracy, privacy, and employer compliance to make sure the system works for workers and businesses alike. 

So in a year when Congress is all about cutting budgets and high‑performance programs, mandatory E‑Verify just doesn’t make sense.  When this bill goes to the House floor, you are going to hear a lot about protecting jobs and undocumented immigrants, but I think the members of this committee can play a really key role in highlighting the impact on SSA and impact on U.S. citizens who are the people that are most affected by this program. 

Thank you. 

Chairman Johnson.  Thank you, ma’am.

[The statement of Ms. Moran follows:]

Chairman Johnson.  It sounds like you don’t like the program.  We have got to do something to stop the illegal workers. 

Ms. Moran.  If we pair it with legalization, then we can talk. 

Chairman Johnson.  Dr. Anton, you are recognized for 5 minutes.  Thank you.

STATEMENT OF ANA I. ANTON, Ph.D., PROFESSOR, DEPARTMENT OF COMPUTER SCIENCE, COLLEGE OF ENGINEERING, NORTH CAROLINA STATE UNIVERSITY, ON BEHALF OF THE ASSOCIATION FOR COMPUTING MACHINERY
 

Ms. Anton.  Good afternoon, Chairman Johnson, Ranking Member Becerra and members of the subcommittee.  Thank you for the opportunity to testify.  This statement represents my own professional position, as well as that of the Association of Computing Machinery’s U.S. Public Policy Council. 

By way of introduction, I am a professor of software engineering at North Carolina State University and the director of an academic privacy research center.  In addition, I serve on several industry and government technical boards and advisors, including the DHS Data Privacy and Integrity Advisory Committee. 

The E‑Verify pilot system is intended to ensure that only authorized citizens and legal residents can be employed in the United States, a laudable objective, especially in a time of notable unemployment.  Unfortunately the intent has not matched the realization.  Complex systems such as E‑Verify are fallible and often misused and subject to mission creep.  One large‑scale evaluation of E‑Verify reported that the majority of illegal immigrants checked through the system were incorrectly deemed eligible to work primarily as a result of identity fraud.  Thus E‑Verify remains vulnerable to and incentivizes the use of identity fraud. 

Among the issues noted in my written testimony are three that are especially critical to consider from a systems engineering perspective.  First, E‑Verify must be able to accurately identify the individuals and employers authorized to use the system in a trustworthy manner before it is widely deployed.  Second, proof of success with a pilot must be required before extensively expanding it.  Third, complex systems such as E‑Verify are often misused and repurposed in ways that violate sound principles of security and good software engineering.  This should be considered in the design of the system and in supporting legislation. 

Given the identification‑authentication concerns in E‑Verify, it is important to distinguish between an identifier and an authenticator.  Both have very special technical meanings and are often confused.  In my written testimony I described the differences between identification and authentication.  In brief, an identifier is a label associated with a person.  An authenticator provides a basis to believe that some identifier accurately labels the person. 

Within the context of E‑Verify, the self‑check pilot system, which we heard of a few minutes ago, it authenticates individuals by requesting information that can easily be obtained via the white pages and public tax records by individuals other than the holder of the Social Security number.  The requested information is not sufficient for proper authentication.  The pilot allows unauthorized individuals and fraudsters to access the system, allowing them to check stolen information to determine if it can be used to craft a new fraudulent identity to obtain employment.  As currently configured, mandated use of E‑Verify would encourage an increase in computer fraud, abuse and identity theft. 

Additionally, to protect the innocent, employers who take action on nonconfirmation returns without informing applicants and providing them an opportunity to appeal and correct mistaken records must face strong penalties.  Exceptions for cases of natural disaster or emergency should also be built in.  Under such circumstances, requirements should be waived or suspended when seeking new employment. 

In the time remaining, I will highlight a few recommendations from my written testimony, again from a systems engineering perspective.  First, it is critical to eliminate the weaknesses in E‑Verify and objectively audit the pilot before it is scaled up or extended to individuals for anything other than employment.  Lack of proper system validation and verification will almost certainly lead to cost and schedule overruns, system breakdowns, intrusions and perhaps obsolescence. 

Second, it is imperative that vulnerabilities be examined and risks addressed to protect the system as well as the identity of the individual whose information is contained within it. 

Third, adopting biometric technologies as a solution to the E‑Verify authentication problem would be premature and is unlikely to solve some of the fundamental problems with the current system. 

In conclusion, we are encouraged by your attention to these issues, and the computing professionals that I represent stand ready to help you in your efforts. 

Thank you for your attention. 

Chairman Johnson.  Thank you, ma’am.  I appreciate your comments.

[The statement of Ms. Antón follows:]

Chairman Johnson.  Mr. Fragomen, welcome.  You are recognized for 5 minutes. 

STATEMENT OF AUSTIN T. FRAGOMEN, JR., CHAIRMAN OF THE BOARD OF DIRECTORS OF THE AMERICAN COUNCIL ON INTERNATIONAL PERSONNEL, ON BEHALF OF THE HR INITIATIVE FOR A LEGAL WORKFORCE

Mr. Fragomen.  Thank you, Mr. Chairman, Ranking Member Becerra, members of the subcommittee.  I wish to thank you for your kind invitation to share my thoughts on employment eligibility verification and the problems U.S. employers face. 

Before we discuss E‑Verify, I would like to acknowledge the fine job done by the U.S. Citizenship and Immigration Services in expanding and improving the program.  Based on the agency’s last numbers, enrollment is up to 254,000 employers, and you just heard that 98.3 percent of the queries result in automatic response within 24 hours, which shows a steady improvement over the past decade.  However, the number of participants only represents about 3 percent of all employers, and scalability is still a concern. 

While E‑Verify has become very effective in matching a name with a Social Security number, it is not effective in making certain that the employee is who he or she claims to be on the form I‑9.  According to a December 2009 report, 54 percent of unauthorized workers who undergo E‑Verify are erroneously confirmed as work‑authorized.

E‑Verify has made some progress towards solving this problem.  One example is the incorporation of photographic images from green cards, Department of Homeland Security work authorization cards and U.S. passports.  And we appreciate that there are plans to include driver’s license data from motor vehicle departments around the country, but so far there is only one State involved in a pilot program. 

Over the past 2 years, the employer community has witnessed much more scrutiny by Immigration and Customs Enforcement Agency, not that I am objecting to enforcement of the law, I think that is perfectly appropriate.  But employers want certainty.  Employers want to know they have a true safe harbor when they obey the law, and those are really the two cornerstones. 

Under the status quo, employers do not have clear guidance on what to do when informed of a Social Security record mismatch, or when the information does not match government records, there is no assurance that the employers are not victims of identity fraud. 

I believe the solution to the unauthorized employment problem and ultimately an important weapon in addressing illegal migration is reliable employment eligibility verification.  Before we can eliminate false nonconfirmations in E‑Verify, there must be sufficient resources allocated to the Social Security Administration to clean up its records.  We also need clear guidance on what to do with Social Security number mismatches.  However, we do not believe it is necessary for all employers to reverify their entire workforce. 

For the system to be effective, additional steps are necessary to stop identity fraud.  Matching photographs, of course, will have a positive impact, but it does not eliminate subjectivity on the part of the employer.  Instead, this will require incorporating biometric technology, such as that proposed in the Johnson‑Giffords New Employment Verification Act, and other comparable technology.  If we can stop identity fraud, it will give law‑abiding employers a safe harbor and at the same time take away the subjectivity that encourages discrimination, either deliberate or inadvertent. 

Further, having an effective and reliable system would strengthen the argument for Federal preemption in immigration enforcement, something that business and immigrant rights advocates both want. 

Finally, an effective eligibility program is a critical component of law enforcement filling the gaps that border control and visa tracking currently leave in the process. 

Thank you for this opportunity to share my thoughts. 

Chairman Johnson.  Thank you, sir.

[The statement of Mr. Fragomen follows:]

Chairman Johnson.  What is the State that is using the driver’s license? 

Mr. Fragomen.  Mississippi. 

Chairman Johnson.  Thank you. 

We have got a vote.  There will be two votes.  I am going to put the committee in recess for 30 minutes, or if we get back sooner.  Thank you.  We stand in recess. 

[Recess.]

Chairman Johnson.  The committee will come back to order. 

I would like to ask Mr. Fragomen, the most critical issue facing America today is jobs.  And I think without jobs and job creation, our country is doomed to a lower standard of living for decades to come.  What steps need to be taken, in your opinion, to ensure that employment verification, in particular an expanded E‑Verify, doesn’t complicate or impede creating a job and hiring the right person for the job? 

Mr. Fragomen.  I think that is a very critical issue.  The most important factor is to move into this slowly if we have mandatory verification, and to make sure that it is possible to scale the system to the level that it would need to be and to, as they say, get it right.  Now, in order to get it right ‑‑

Chairman Johnson.  When you say “scale the system,” what do you mean? 

Mr. Fragomen.  In terms of increasing it.  The system now covers about 3 percent of employers. 

Chairman Johnson.  We have been fighting that for years. 

Mr. Fragomen.  It needs to cover 100 percent, which means we have to add about 7.5 million employers to the system, which means that the volume of transactions that the E‑Verify, for instance, would have to be able to accommodate would be multiples of what it is currently.  And you know the problems that software encounters when you try to increase its capacity by that magnitude.  And the second thing is ‑‑

Chairman Johnson.  I know.  But Social Security claims they have the most modern system available today.  I mean, that is what they tell me. 

Mr. Fragomen.  They might.  Except the number of tentative nonconfirmations, when you multiply it by that number of employees, becomes a very significant number if you figure about 1 to 1.5% percent of the cases wind up as tentative confirmation.  There are ones that don’t get resolved easily. 

The other aspect of it is that there be adequate resources dedicated to Social Security so that they do it right, that the system be fully electronic, that it incorporate biometrics or other fraud‑prevention technology or software; and secondly, that we have a uniform law, that this applies everywhere, and it preempts the current State laws. 

I think it is very important that the employer is offered a safe harbor, because at the end of the day, it is really the government’s responsibility to get the system right to protect the employer, and to offer a safe harbor, and to protect the employees against potential discrimination.  But to accomplish all of those goals, it really has to be a government‑driven system that can prevent identity fraud. 

Chairman Johnson. Well, every expert we have talked to acknowledged the fact that E‑Verify can’t detect identity fraud very well and may, in fact, encourage it.  So that puts the employer on the frontline of trying to detect and prevent identity fraud.  So can you tell us the challenges faced by your companies in their attempts to detect identity illegalities and yet fill the jobs that Americans need? 

Mr. Fragomen.  I think it is very frustrating to companies who have to go through this process, because essentially they have to accept the documentation that is given to them by the employee as long as it looks reasonable on its face.  And there is really nothing further, no further steps they can take.  If they ask for additional documentation, they could easily be accused of discrimination.  And the companies, of course, are generally very concerned about making certain they do things right and they don’t hire workers that aren’t legally authorized to work because, of course, they could lose these employees in an enforcement action, and then, of course, that would hinder their ability to deliver the service that they are delivering. 

So it is counter ‑‑ it is a counterintuitive situation because you have ‑‑ you are presented with documentation, you really don’t like the way the documentation looks, but you have no reason to say with certainty that there is anything inappropriate, you just have to accept it.  So I think it puts the companies in an extremely difficult position.  And of course, if it turns out that the documentation, in fact, is fraudulent, then the employer’s whole business is at risk, and an enforcement action, and he loses a big portion of his workforce. 

Chairman Johnson.  Thank you very much. 

My time has expired.  Mr. Becerra, you are recognized. 

Mr. Becerra.  Mr. Chairman, thank you very much.  And I thank each of and every one of you for your testimony. 

I don’t believe there is a person in this Congress and, I suspect, sitting here in this audience who wouldn’t agree that as a sovereign Nation, we have to do everything we can to make sure that we understand who is in our country and who is securing employment in our country.  And I know that we continue to try to figure out the best way to get there.  So your testimony is important because Congress is going to make every effort to try to take us to a place where we can tell the world ‑‑ not just Americans, tell the world ‑‑ that we are going to determine the best way to figure out who should come into the country and who should be able to work in our country.  And so I wish you great deal of good fortune as you continue to assemble the information and the data that will help us make the best decisions here. 

I am concerned about two things in particular:  As we try to move forward in verification for employment, that we are not undermining the essential work that is supposed to be done by the agencies that might be placed in a position of charge to do the work.  So in the case of Social Security Administration, you are already backlogged in trying to deal with disability claims from Americans who are trying to get their benefits.  You are backlogged when it comes to trying to secure the different resources you need to do the other things that come from having the most popular identifier in the world, the Social Security number.  So I am wondering if you can give us a better sense. 

Right now E‑Verify is a program used in 2 or 3 percent of the employment community.  And if you expand it and make it mandatory throughout the Nation, we are expanding it dramatically.  And we have already heard the stories of the potential fraud, potential misuse of identity, and certainly the dramatic dislodgement of employment that an American may have secured rightfully and then loses it.  How are we prepared, then, to move to a fully national mandatory system? 

And so perhaps what I can do is ask Mr. Stana first to give us a sense if you think any of the Federal agencies that would be in charge of a nationwide mandatory system are equipped today with resources and personnel to go to ramp up to full 100 percent participation of the employment community. 

Mr. Stana.  Well, I think, as you pointed out in your statement, the CBO estimated it would take billions of dollars to make sure that Social Security and DHS and whoever else would be involved would have both the technology and the personnel to make this happen.  Currently do they have that to ramp up right away to a mandatory system?  Probably not.  But with proper resources, they could get there. 

The other questions you raised about the ID theft and making sure that you don’t have false negatives, the system will need adequate resources to get on top of these issues.  The challenges do not pertain to the 95 percent of the population that is properly handled, it is about the 5 percent that is problematic. 

Mr. Becerra.  But the 95 percent of the population might pay the price as we try to deal with that 5 percent. 

Mr. Stana.  You can’t ignore the 95 percent. 

Mr. Becerra.  But, Ms. LaCanfora, let me ask you this.  Social Security in this tough budget environment is taking a hit in this 2011 budget.  Chances are it might take a hit in the 2012 budget.  You are already having a difficult time dealing with all of these other responsibilities you have to our Americans who are applying for retirement benefits, for disability benefits, survivors’ benefits.  Can Social Security ramp up to a 100 percent E‑Verify participation without sufficient resources to do this? 

Ms. LaCanfora.  The simple answer is no, Mr. Becerra.  We appreciate and share your concerns about funding.  It really depends largely on what you consider mandatory 100 percent expansion.  Right now E‑Verify is largely used for new hires, with few exceptions, and if you look at the current volume, we get about 16.5 million queries a year.  If you ramp it up to new hires nationwide, that would be around 60 million queries a year.  If you ramp it up even further to include current employees, you could be getting up to 140 million queries a year or more. 

So it depends on the mandate.  But certainly any mandate would have a significant impact on Social Security, increased traffic in our local offices, and we would need to be funded for that. 

And I would also support the comment made by one of my colleagues earlier to say that any mandatory move should be phased in so that we have the opportunity to ramp up and hire as needed. 

Mr. Becerra.  And, Dr. Anton, and, I hope, Mr. Fragomen, you as well will continue to provide us with some information that helps us pinpoint some of what your testimony really focused on, and that is how you make this work.  How do you collect the information?  How do you deal with this Internet fraud that is out there?  We really need that to be able to move forward. 

Ms. Moran, I hope you will continue to give us the real case, real live examples of individuals, U.S. citizens, lawful permanent residents who have been impacted because we haven’t done this perhaps as quickly in implementing a workable program as we would like.  So as we continue to figure out how to ramp up, I hope you all will continue to give us information. 

Unfortunately my time has expired, but I would have loved to have gotten into it more with you all.  But I appreciate very much your time with us today. 

Thank you, Mr. Chairman. 

Chairman Johnson.  Thank you.  I appreciate your comments. 

Mr. Paulsen, you are recognized for 5 minutes. 

Mr. Paulsen.  Thank you, Mr. Chairman. 

Mr. Fragomen, small businesses are top job providers.  How much of a barrier is not having Internet access for using E‑Verify for those folks? 

Mr. Fragomen.  Well, not having Internet access certainly makes it much more difficult.  As you know, you could make verification available by telephone again, but that is not a particularly desirable way to do it.  I suppose the good news is this is becoming less of a problem as telephones now are morphing into Internet‑enabled devices.  So I think it will become less of a problem over a period of time.  But certainly it is an issue now. 

And the other big issue, too, I think, for small businesses is just the impact on the small businesses if they have a small staff.  Since they tend to not have too many employees that have to go, quote, hang around the Social Security office with thousands of other people who will be doing the same thing at the same time, you can imagine what the impact of that would be on these smaller companies. 

Mr. Paulsen.  I was kind of wondering if you thought smaller employers essentially should be held to the same standard as larger companies in terms of a compliance measure.  They can’t get access to the Internet like larger employers.  Are you concerned that a work verification system might not only discriminate against the workers, but also against potential small employers? 

I should ask you, what about the situation where a potential worker is caught in a tentative nonconfirmation problem, and the need for communications between Social Security and the employer become critical? 

Mr. Fragomen.  Once again, that is a big issue.  I think, in fact, most situations are going to require the employee to actually go to the Social Security office or whatever to try to get these problems resolved.  I don’t know how many of them are really going to be successfully resolved electronically.  But certainly, not having Internet access would be a big problem, and I think it would require on behalf of the smaller employers that they may just have to try, as I say ‑‑ try to use some of these technologies so that they can get more in the game. 

Now, whether it would be reasonable to exempt them, I think that becomes difficult when you consider the number of small employers there are, and the fact that frequently these small employers are where the undocumented immigrants may be employed.  So I think giving them sort of exemption would probably be a good idea maybe for a period of time. 

Mr. Paulsen.  That was my follow‑up.  I was curious if you thought it would be a reasonable option to give them an exemption for a certification for a business, the smaller ones in particular, if they have shown to be good employers or they have had a good‑faith effort to actually abide by the law. 

Mr. Fragomen.  Yeah, I think it would be very reasonable to do that for, as I say, a period of time, because as we discussed a minute ago, it would be important to phase in the program, and the larger employers could be phased in first before smaller employers. 

Mr. Paulsen.  Thank you. 

I yield back, Mr. Chairman. 

Chairman Johnson.  Thank you, sir. 

Mr. Berg, you are recognized for 5 minutes. 

Mr. Berg.  Thank you, Mr. Chairman. 

My question, Ms. LaCanfora, concerns some new hires are authorized to work.  We heard a little bit about receiving an erroneous tentative nonconfirmation from the E‑Verify system.  It seems like we have got too much bureaucracy in here that is really creating a problem for people that are obviously getting kicked or flagged with the system.  So I guess my question is, we know Social Security can extend the deadline, and we have field office employees that can make the entry into the electronic system, the EV‑STAR.  What is SSA doing to try to improve this and keeping people from falling through the cracks? 

Ms. LaCanfora.  Thank you for the question.  Over the past 2 years, we have worked closely with DHS to decrease the number of tentative nonconfirmations.  It used to be somewhere, I think, as my colleague said, up around 8 percent.  Right now tentative nonconfirmations are around 1.7 percent of the total, and less than 1 percent actually come to Social Security.  So the other tentative nonconfirmations may be resolved through DHS.  So we get less than 1 visit for every 100 queries coming through the system.  That is far lower than it has been in previous years. 

In terms of the EV‑STAR System, we have, as a matter of fact, next week an enhancement to the system coming in where if someone walks into one of our offices as a result of a tentative nonconfirmation, they don’t have to tell our employee that.  They can say, listen, I have some sort of discrepancy I need to resolve.  And what will happen is when our employee goes into the system, an alert will pop up saying, check EV‑STAR, so we can assure that we catch every one of these cases and then document it properly in the system.  We expect that that enhancement will significantly increase our use of EV‑STAR. 

Mr. Berg.  Thank you. 

I yield back, Mr. Chairman. 

Chairman Johnson.  Thank you, sir. 

Mr. Smith, you are recognized for 5 minutes. 

Mr. Smith.  Thank you, Mr. Chairman. 

Mr. Fragomen, would you talk about the impact of the patchwork of laws on employers?  If you could emphasize that, and then about the challenges this creates for Homeland Security in determining the volume of E‑Verify workloads. 

Mr. Fragomen.  Well, impact is very significant.  The State laws basically differ from each other.  They frequently differ from the Federal law.  States sometimes struggle with issues that would seem very simple, but in a modern economy, it becomes les obvious. For instance, what is the place of employment; if you physically work in one location, but you report into and you are paid by an employer or an office that is in the State; or perhaps there is no office at all in the State, but you actually, in fact, render services that benefit, for instance, a company with whom you have a contract in that State.  So they have a lot of difficulty identifying what the different standards are.  And then, of course, you have your virtual employees who are just working at home. 

So the bottom line is that it is a very, very expensive proposition for corporations to try to track all of these different rules and try to comply with them on a State‑by‑State basis. 

Mr. Smith.  And, Ms. LaCanfora, everything is fully reimbursed at Social Security, right? 

Ms. LaCanfora.  Yes.  DHS reimburses us for all of our costs. 

Mr. Smith.  Can you elaborate how that reimbursement takes place? 

Ms. LaCanfora.  Sure.  What happens is at the beginning of the year, DHS will estimate the number of queries that they expect.  We at Social Security estimate the amount of the fallout that we expect to happen; in other words, the number of people that will actually walk into a field office.  And with those two numbers, we then estimate the amount of money that DHS should reimburse us for the year, and they pay us that money up front, and then at the end of the year, after we know how many queries we actually got and how many field office visits we actually got, then we reconcile those numbers and we sort out the change. 

Mr. Smith.  Thank you. 

Thank you, Mr. Chairman.  I yield back. 

Chairman Johnson.  Thank you. 

Mr. Tiberi. 

Mr. Tiberi.  Thank you, Mr. Chairman. 

As I left, I told Mr. Fragomen ‑‑ just to let everybody else know before I ask the question ‑‑ just this morning I had an employer talk to me about this issue.  A family‑owned business, participating voluntarily in the E‑Verify system, has been very frustrated with the lack of continuous continuity in the system.  Sometimes it takes up to 7 days for verification.  At that point, usually if it takes that long, the applicant that he is going to hire is gone and goes to another employer who doesn’t have an E‑Verify system.  So he is frustrated from that perspective. 

He is frustrated that this small business owner who owns 12 restaurants in Ohio was audited in a voluntary manner by ICE and found that 83 of his employees in total that were E‑Verified had given him incorrect information on the I‑9 form,  so he got fined.  He fired the 83 employees, and they are probably working somewhere else.  And here is an employer who is actually trying to participate in the system. 

So I have grave concerns about how a mandatory system would work when clearly the voluntary system is not working for employers ‑‑ some employers today.  So I would like to ask each of you ‑‑ and we can start at the end here, what do I tell my constituents about why I should support a mandatory system when clearly the voluntary system is not working? 

Mr. Stana.  When we did our work that resulted in the report that was issued a few months ago, we went out to the State of Arizona and North Carolina and a few other places and talked to employers and employer groups, and asked them what they wanted in an E-Verify system.  Some of the issues you are bringing up today really weren’t on their radar screen.  They said they want something that is reliable, fast and not burdensome.  And they are worried about other employers having a competitive advantage because they misuse the system. They fear they could lose an employee who later goes down the street to another employer who misuses the system and gets hired. 

So I think what I would say to your constituent is that to the extent that this system is reliable, fast and not burdensome, it would be ready for prime time, in our estimation. 

Mr. Tiberi.  But today he would argue ‑‑ I am not sure it is not reliable ‑‑ the E‑Verify system is not reliable, sometimes takes up to 7 days, and in this case not very timely or accurate. 

Mr. Stana.  Without knowing the facts and circumstances of that case, maybe he described it differently.  He shouldn’t have sent the information into the E‑Verify system until he actually hired the individual.  You shouldn’t use it for screening.  That is a no‑no.  But if it takes 7 days to get a response, that is an exception. If such delays happen a lot, then that is of concern. 

Mr. Tiberi.  It happens a lot, he said. 

Ms. LaCanfora.  I would say SSA has a very limited role in E‑Verify.  We obviously have a database, as was mentioned earlier, with over 450 million records of Social Security numbers, which include dates of birth and some citizenship information.  But DHS is responsible for all other aspects of the E‑Verify system.  I have to defer to them largely to respond to your question. 

Mr. Tiberi.  Ms. Moran. 

Ms. Moran.  I am not going to convince you to support a mandatory system.  In fact, I don’t think that you should.  What we need to do is find a solution to the broken immigration system.  The employer in your state wants those 83 employees.  They need employment.  We need to just find a solution so that employer in good faith isn’t liable for immigration violations, and he or she can get the workers that they need. 

Mr. Tiberi.  Thanks. 

Ms. Anton.  I would just like to point out there is another issue that has been raised that affects small employers, which is the fact that small employers generally don’t have the resources to properly secure their systems.  And so in addition to being fined for that kind of thing, they are going to have data breaches, they are going to have databases which contain information that identifies other people, and they are going to be easy targets for people to hack into their systems, insider or out.  So that is another consideration is they don’t have the resources; not just Internet access, but the fact that their systems are vulnerable to botnets they don’t even know that are on there, viruses, et cetera.

Mr. Tiberi.  Great point.  Thank you, sir.  

Mr. Fragomen.  Well, it seems to me that if the government mandates that you go through this process, that they then have to assure that as a trade‑off, that the system will be certain, and you will be given a safe haven if you do what you are supposed to do.  So before the system, in my mind, is ready for prime time, it has to be ‑‑ it has to be improved to the point where that is possible.  And it has to address this whole issue of identity fraud.  And until it addresses identity fraud, has adequate resources, fully electronic, et cetera, it should not be mandated because it is not reliable. 

Mr. Tiberi.  Thank you.  I yield back. 

Chairman Johnson.  Thank you. 

Mr. Brady, you are up. 

Mr. Brady.  Chairman, thank you for holding this hearing. 

I really appreciate the comments of all of the witnesses today.  I am convinced in the broader issue that we have to close the back door of illegal immigration so that we can keep open the front door of legal immigration.  Workforce verification being timely and accurate is the key to that, to do it successfully and fairly. 

Dr. Anton, you had an interesting comment in your testimony about mission creep and how databases start to tie into one another, and before you know it, you are going to have a dangerous situation.  Some have suggested that Social Security, IRS and Homeland Security share taxpayer data in the workforce hires.  We hear that often.  We, the committee, have been very apprehensive about any sharing of taxpayer data.  Now, our jurisdiction regarding section 6103 in the IRS Code prevents it.  In fact, our staff asked the Joint Committee on Taxation to prepare a report on these provisions in preparation for this hearing, and, Mr. Chairman, I request that this report be entered into the hearing record. 

Chairman Johnson.  Without objection. 

Mr. Brady.  So, Doctor, can you speak to the taxpayer data issue and mission creep and workforce issues.

Ms. Anton.  Certainly.  So from a privacy point of view, clearly when you start commingling IRS data with other databases in the United States, that raises a lot of red flags. 

As a technologist, I can say that requiring, for instance, authentication ‑‑ for authentication, let us say that you had to provide what was the figure on line 19 of your IRS statement from tax returns from last year.  That is something that no one else can get.  That is something that only I can look at.  So, from that perspective as an authenticator, it is pretty strong.  But the concern, then, is that that raises a lot of risks once you start providing that kind of access between systems, and every time you start piggy‑backing databases, then you are ultimately increasing the risk of security problems, transmission of information, data leaks, data peeping, like when there is celebrity peeping, et cetera.  So it raises a lot of the different risks that have to be considered, and how do you secure all of those transactions as well. 

Mr. Brady.  In laymen’s terms, businesses and agencies today focus on keeping their data secure.  How much greater does the risk increase when you start sharing those types of data across agencies? 

Ms. Anton.  Ultimately the more data that you have about someone in a database, the easier it is to access a lot more information and cobble together new identities, and so it becomes a very rich target for attack.  So that is something the government has to think about is what do we really ‑‑ there is no such thing as a secure system.  We have centuries of experience with war to show that there is no such thing as a secure system or country, et cetera.  And so with that knowledge, we have to think about do we really want a system that will eventually be broken into, that will make it easier for people to propagate identity fraud.

Ms. Anton.  So there are just different risks that we have to do.  And we need to consider how do you design the system in such a way that we address the real problem at hand instead of patching things on in the hopes that we keep putting Band‑Aids on ‑‑ okay, well, maybe if we just check people to see whether or not they are eligible to work ‑‑ and then we have all of these other problems.  And the real problem, I think, is an immigration problem.  So I will just throw that there.

Mr. Brady.  Got it.  Chairman, thank you.

Chairman Johnson.  Thank you, Mr. Brady.  That is interesting.  You know your line 19 on your IRS form? 

Ms. Anton.  I don’t.  I just threw that out there.  But the point is that I would have to look it up.  And if I have to look it up, then someone else can’t use it.

Chairman Johnson.  I am not sure I could find mine 10 days after I file the form. 

You know, all of you, use of biometric data is always another proposal for ID and authentication.  We have been talking about that for a long time, and, of course, it is not perfect either.  But can each of you comment on biometrics and what you think of this? 

Mr. Stana.  Let me answer that two ways.  First off, it could be very expensive to do it right.  And to do it right might be something other than putting a chip in a card and sliding it into a reader, because those kinds of systems have been hacked in a matter of hours.  So that is not good.  You have to have a separate data set.  So that could be very expensive, but maybe in some form necessary to make this thing work. 

Second, biometrics raise all kinds of privacy concerns.  How much of your identity should the government have?  That is a question that I am not ready to answer.  Should the government have my retina scan?  Should the government have my fingerprint?  Well, they already have my fingerprints, but how much information do you want the government to have?  And then you get into the data privacy and security issues.

Chairman Johnson.  I would like to give it to them so I can get through the airport quicker. 

Mr. Stana.  Well, that is the other thing.  Some people would be perfectly willing to give it up if they could bypass the system somehow; they’d like to put their hand on a reader, and  instantly be work‑authorized.  Others are very sensitive about that. 

Ms. LaCanfora.  I will preface my comment by saying I am not an expert in biometrics, but I do agree that incorporating biometrics into E‑Verify would be a costly proposition. DHS, it was mentioned earlier, is allowing employers now to access passport photos and is working to obtain driver’s license photos.  And looking at photos is one means of identity assurance, although not foolproof.  I think decision makers need to weigh those options against the biometric option to see what is cost‑effective and what gets the job done to the extent possible.

Chairman Johnson.  Thank you. 

Ms. Moran.  So the cost and the accuracy issues have already been mentioned.  And I encourage you to look at some studies of the Transportation Worker Identification Credential, the TWIC card.  It is like a billion dollars, huge error rate, it is kind of in a mess.  So I would encourage you to look at that.  I think it is the closest thing. 

The point is that ‑‑

Chairman Johnson.  It worked, though.

Ms. Moran.  I mean, for some it does, but there has also been some very high error rates, and also the census folks got a 20 percent error rate on fingerprints when they tried to do it for the workers last time around. 

So I think the point is that E‑Verify, biometrics, nothing is a magic bullet.  Again, not to repeat myself, but if you still have undocumented workers in the economy, just like E‑Verify, they are just going to go underground and get around the system.

Chairman Johnson.  Thank you. 

Ms. Anton.  So I would just note that if you also add biometrics to a database, that becomes a very, very rich, wonderful asset for anyone who wants to gain access to it. 

And another challenge with biometrics is this is another single‑factor authentication approach.  And so we really are advocating a layered approach where we have multiple ways to authenticate people. 

There are places in which biometrics, I think, work very well.  For instance, to enter in the Olympic Village, there is always hand geometry, and your hand geometry gets compared to your badge.  That isn’t retained in any database.  So I have to have my credential with me to get in.  And so that is a very nice way, approach to do it because you don’t have the responsibility of having a database with all the biometrics stored in it. 

On the other hand, it is extremely expensive because it means you have to have a reader every single place, and there can be hardware failure associated with that.

Chairman Johnson.  Thank you. 

Mr. Fragomen.  If over half of the unauthorized workers who undergo E‑Verify are erroneously confirmed as work‑authorized, it seems as though we are creating a pretty vast system which impacts on the whole populace, and we are not being very effective at ferreting out unauthorized workers.  So it seems to me that as problematic as it might be because of the cost, you still must stop the use of false breeder documents which can lead to issuance of fraudlulent identification suggesting you are someone different from who you really are, and which can cause obvious data security problems. It seems to be that unless we tackle identity fraud and false breeder document problems, at the end of the day, I don’t know that we are being very effective in keeping unauthorized workers out of the workforce.

Chairman Johnson.  It is a cumbersome idea, but it might work. 

Mr. Becerra, do you care to question? 

Mr. Becerra.  You actually inspired a question that sort of stems from something Dr. Anton mentioned earlier.  You mentioned that trying to expand E‑Verify when is prone to errors, prone to intrusion, and loss of privacy, and at the very end you close by saying it is almost as if we are trying to build a system that hasn’t been proven to work effectively because we have a decrepit immigration system that is not helping us keep tabs of folks in the first place we are authorized to work.  So it sounds like we are piling on top of a broken system. 

Other systems that we are not quite sure are ready for prime time may cause difficulties for Americans’ privacy and security and may lead to a lot of businessmen and women having to go through some expense and perhaps difficulties with their business if they must go through a system that doesn’t always give them the check they need.  And so it seems like we would rather than pile on, we should clear the dust and deal with the foundation of why we are talking about coming up with a verification system in the first place. 

Ms. Anton.  Yes, I wholeheartedly agree, and as you were speaking, it reminded me of everything we would read about business process for engineering during the late 1980s, early 1990s, where one of the problems is that people were building systems that automated existing broken business processes and practices.  And so that is why systems become obsolete. 

And so I think it is really good to think out of the box and think it would be really big, this is a grand challenge, if you will, and how do we solve a problem; and then build a system that really supports a well‑designed business practice. 

Mr. Becerra.  Mr. Fragomen, a question for you.  If you could take control of this, could you devise a system that would work for verification purposes? 

Mr. Fragomen.  Well, I think it would be possible. You have to start with the premise that you have to try to limit the number of persons that enter the U.S. illegally.  That has to be the first step.  You have to have more effective border security.  You have to have better systems to keep persons who enter legally from overstaying their status and becoming illegal. 

You have to then ‑‑ once you have a more secure entry system and better control, it seems to me then you definitely have to have a workplace enforcement system that is driven by bioidentifiers. 

Interior enforcement doesn’t work.  For instance, the law that Arizona passed and, of course, was just found unconstitutional, it doesn’t really work, and it never has, because you can’t basically formulate reasonable suspicion to believe who is in the U.S. illegally, which would then arguably give you a right to question that person; reasonable suspicion to believe that they are an alien unlawfully present in the U.S.  So you really can’t do that without using racial appearance as a primary factor.  So that is never going to work.

So really your only shots at this are border enforcement, a legal immigration system that allows a larger number of people to come into the country to work legally, and workplace enforcement.  I think you need those three things combined.

Mr. Becerra.  It sounds like you have just read off the litany of things that most people say we need for comprehensive immigration reform. 

Mr. Fragomen.  It is certainly a number of those pieces.

Mr. Becerra.  Thank you.  I appreciate all of your testimony, and we will probably have you back again soon.

Chairman Johnson.  Thank you all for being here.  I appreciate you taking the recess with us.  We did do two votes, and, you know, the world is still turning. 

Thank you all so much.  This meeting is adjourned.

QUESTIONS FOR THE RECORD

Ana I. Antón, Ph.D.
Austin T. Fragomen, Jr.
Marianna LaCanfora
Richard M. Stana

MEMBER SUBMISSIONS FOR THE RECORD

The Honorable Mr. Dreier

SUBMISSIONS FOR THE RECORD

AARP
American Civil Liberties Union
American Federation of State County and Municipal Employees
American Immigration Lawyers Association
American Meat Institute
Asian American Center for Advancing Justice
Jessica St Pierre
Joint Committee on Taxation
National Committee to Preserve Social Security and Medicare
National Council of Social Security Management Associations
National Immigration Law Center
Secure ID Coalition