Fraudulent Use of U.S. Identification Documents

By David Simcox on July 22, 1999
Fraudulent Use of U.S. Identification Documents
Testimony prepared for the U.S. House of Representatives
Committee on the Judiciary
Subcommittee on Immigration, Border Security, and Claims
July 22, 1999
By David Simcox
Chair of the Board, Center for Immigration Studies

I am David Simcox, Chairman of the Board of the Center for Immigration Studies here in Washington, and former executive director of that organization. The Center is a nonprofit, public interest research and policy analysis group that studies the effects of immigration into the United States on broad national social, environmental and demographic interests. Thank you for this opportunity to comment on the seemingly intractable problem of extensive fraud and abuse in the use of U.S. identification documents and vital records.

What needs to be stressed early in hearings such as these and in the national debate is that security of vital records, driver licenses, passports and other federal and state ID documents is not just about immigration control. Even if there were no immigration at all, there would be a pressing national interest in reliable and secure personal identification and data bases for such needs as crime control, government entitlements, banking and finance, health care, tax collection, gun control, and child support enforcement.

While the near anarchy in the misuse of vital records remains discouraging, Congress is to be commended for passing in 1996 the most extensive and rigorous legislation yet to combat document fraud in the administration of immigration, public assistance and related government programs. Their actions reflect a growing national exasperation with rampant fraud. But patience is needed. A number of these provisions, however, will need considerable time to begin changing behavior.

But for now the country remains awash in counterfeit and misrepresented ID documents. INS's pilot work eligibility verification projects in the past half decade have proved what has long been suspected: in industries dependent on foreign workers, such as meat packing and food processing, a huge segment of the work force defeats the intent of employer sanctions with fake documents. A rapidly growing foreign work force, rising prosperity, tight labor markets, the spreading administrative anonymity and interdependence of U.S. society, and the innocence and trusting nature of American institutions, have come together to make secure identification more urgent just as they have made the production and distribution of false documents a large and sophisticated industry that has advanced beyond its "cottage" phase.

In 1998 INS investigators and other federal and state officials in Los Angeles broke up what was the largest document counterfeiting ring ever. Agents seized two million high quality fake government ID cards and other documents, including false credit cards and travelers checks awaiting distribution through an extensive and sophisticated network.

The immense and urgent demand for ID documents "proving" the right to work in the United States leads to the exploitation of the most obscure weak points in the Federal and State systems. In identification as in the physical world, nature abhors a vacuum. In 1996, motor vehicle administrators of my state, Kentucky, which has only a small foreign-born population, dropped the requirement that foreign applicants take the drivers' tests. Within weeks Circuit Court clerks in larger counties saw a significant rise in the number of foreign applicants coming in escorted groups from New York and other major immigrant gateway cities. In Louisville, applications by foreigners rose to nearly 200 a week. INS discovered that a major national immigrant smuggling ring had identified the state as an easy mark for obtaining drivers' licenses. The state also helped invite fraud by not requiring evidence of residence in the state, by granting licenses to visitors of short-term non-immigrant visas, and by declining to verify questionable immigration and vital records documents, and by delivering the finished license on the spot rather than mailing it to the applicant as many state MVA's do.

The remedies to abuse of vital records and ID documents lie in large part with the states. The powers of Congress to help, however, are considerable. I believe that the record of the 23 years since enactment of IRCA show that most of the states genuinely want to improve the security and reliability of their vital records and identification documents, such as the motor vehicle operator licenses -- for reasons of public interest far beyond helping the Federal government to enforce immigration law. Steady improvement in the physical security and anti-fraud measures in state motor vehicle operators licenses in the 1990s have been impressive.

While Congress has preferred to delay implementation, the 1996 Immigration Reform Law's requirement that state drivers licenses meet federal security standards, there is still much it could sustain and expand the States' own promising efforts to bring greater uniformity and security to their licenses. Legislators should consider:

  • Mandating the Social Security Administration (SSA) to give state motor vehicle administrators (MVA) online, interactive access to its files, thus permitting verification of applicants' Social Security numbers before issuance of the license.
  • Mandating similar access by state MVA's to INS files to verify documents presented by foreign applicants.
  • Supporting and encouraging the continued reliability and security of state vital records, in particular, by supporting electronic links between MVAs and vital statistics agencies.
  • Supporting the establishment under state auspices of an "all driver" file and pointer system covering all U.S. license holders, secured by a unique identifier such as the Social Security number. This would reduce fraud, flag problem drivers, and prevent issuance of multiple licenses.
  • Providing, sharing, or funding research on biometric identification to meet MVA's need for rapid capture and retrieval of biometric data with affordable technology.
  • Considering federal legislation raising the penalties for fraudulent use of State vital records documents.
State Vital Records

As directed by the 1989 Immigration Nursing Relief Act, INS analyzed progress in securing state vital records and reported in 1993 that, unlike the drivers license, it was "slow." Six years later it is still slow. Abuse of "breeder documents" remains high. Indeed improvements in the security of INS documents proving work eligibility, and the removal of others that were too easily falsified, have increased the popularity of fake or misrepresented U.S. birth certificates among illegal alien job-seekers. A false claim to U.S. citizenship to unwary employers avoids much of the risk and high-cost of submitting forged work authorization documents.

While there is a uniform model vital records statute drawn up by the National Center for Health Statistics and the Association of Vital Records and Health Statistics Administrators, it is not binding on many states. Our state-based system of vital records continues to suffer from a dizzying diversity of formats, standards, and legal statuses of its documents, even within states. There are no national master file, and the present incompatibilities in the system would make it very hard to establish one. Many well-intentioned states lack the resources to meet the standards in the model statute. Kentucky, for example, supports the concept of matching of all birth and death records, but scarcity of resources forces it to limit its matching to in-state births and deaths and only for those nine years and under.

States need tougher sanctions in their statutes against fraud, alteration, and imposture in the use of their own vital records, now only a misdemeanor in most states. Many lack the authority to confiscate fraudulent ID documents. Usually purchasers and users of fraudulent documents are accomplices rather than innocent victims of swindlers. INS could help the states by sending clearer message that those who obtain work authorization or legal residence through document fraud will not benefit from their misdeeds. While such offenses are deportable, this is not the message INS has been sending. INS now cracks down on the makers and purveyors of false documents, but because of staff shortages rarely acts against the willing beneficiaries of the schemes. Starting off membership in the American community with acts of fraud and bribery does not bode well for good citizenship.

Congress has a continuing interest and a role here, and it does not involve "federalizing" the nation's vital records system. Federal agencies such as the Department of Health and Human Services, the State Department Passport Office, and the INS depend on accurate and timely vital records. Congress should consider further expanding the grants and other incentives it has given to State vital statistics agencies through the National Center on Health Statistics to encourage greater standardization, computerization of registering and reporting, rapid sharing of information among states and with federal agencies, and matching of all birth and death records.
The Legislative Process:
Greater Awareness of the Administrative Limits and Contradictions

Congress itself must be more sensitive to the potential for document fraud. This requires a greater awareness of the vulnerabilities and limitations of ID systems and vital records in the United States. The tendency has been to pass laws awarding immigration benefits to specifically defined groups that exceed the capacity of Federal agencies to adjudicate them accurately. The 1986 Special Agricultural Program was an egregious example of vague criteria and unverifiable personal data on applicants opening the door to massive fraud. Such giveaways threaten the very integrity of our immigration system.

Congress, in its hearings and investigatory process on creating or expanding immigration benefits should give more consideration to the practical question of whether the benefits can be adjudicated with reasonable accuracy and security. It is my impression from years of following hearings in this committee and its counterparts in the Senate that witnesses from the executive branch are often not fully candid on such issues. Now wanting to appear inept or unhelpful, they are reluctant to acknowledge fully the inadequacy and vulnerability of U.S. data and document systems and their proneness to extensive fraud. Correct determination of immigration eligibilities on the basis of foreign documents or affidavits of aliens is even more problematic, verging on the impossible.

Permanent resident status in the United States has become one of the most valuable commodities on this planet. It is hardly surprising that each Congressional act to extend it to a new group will confer immense value on documents or information establishing membership in that group. Such legislation evokes remarkable creativity and entrepreneurship throughout the world to produce the needed documents or data and rising political pressures on legislators to accept lower standards of proof.

Before each vote on such measures, each congressman should have the information that will make him ask himself and others: will administrators have the reliable information and the clarity of guidelines to award this benefit only to those deserving it, while effectively screening out the myriad of unentitled who are likely to claim it? If the honest answer is "no," then the question must be whether the public interest would be better served by delaying, defeating or reformulating such legislation.
Balancing consumer service, accuracy, and privacy

Legislators must recognize and deal with the fact that tighter screening and closer scrutiny of personal identification has a political cost. Every administering agency -- indeed, Congress itself -- has three conflicting goals in applying the law: Good customer service, protection of privacy, and accuracy of information on which to base the decision. All too often the search for accuracy comes to be seen as "red tape" to be cut in the interest of quick customer satisfaction. But often forgotten is that millions of American who favor responsible management of immigration are also "customers" of the government.

Similarly, the debate over improved identification has tended to pivot on the possible threats to the privacy interests of potential victim groups, while overlooking the added protection such systems may provide to the privacy and security of scores of millions of ordinary Americans. This may help explain why polls show that most Americans, including minorities and immigrants, favor a national ID system, with the support for it greater among lower income groups (source: Gallup surveys of 1983 and 1993; CNN/USA Today/Gallup Poll of July 9, 1995) .

The presumption of threats to privacy is often raised as an obstacle to accuracy and completeness of information, a convenient scarecrow for those whose real objections lie elsewhere. Reconciling basic privacy safeguards and effective compilation and use of personal data is one of the toughest things policy makers must do in our democratic society. Public and congressional perceptions of the extent of threats to privacy have varied widely and at times unexplainably, depending on the particular issue.

The 105th and 106th Congresses have blocked the implementation of federal standards of acceptability for state drivers licenses legislated in the 105th Congress because of fears of threats to privacy and individual freedom. But to crack down on child support deadbeats, and with little reference to privacy concerns, the 104th Congress in the Welfare Reform Act, mandated creation of a nationwide Directory of New Hires, a massive database of the nation's workers that imposes new responsibilities on employers and gives the Federal government an unprecedented ability to monitor the work force. For reasons of privacy, however, that data is not accessible to INS and other law enforcement agencies.

I conclude by taking noting the Social Security Administration's 1997 study of the options for a tamper-proof, secure Social Security card that can carry varying amount of personal and administrative data and which may use biometrics (Report to Congress on Options for Enhancing the Social Security Card).

I believe this report shows clearly the technical, administrative and financial feasibility of giving the American people a useful and secure document that will help safeguard their privacy and reduce identity theft. Even the highest cost option, a plastic card with optical storage at a total cost of $9.2 billion, seems reasonable when spread over five or more years and when compared with prospective savings to Americans from forestalling fraud and abuse. While all seven options provide the basis for further discussion, I would urge the appropriate committees of Congress to give serious study to those options that are the most fraud-proof and most sophisticated in storing and protecting personal data, take the lead in educating the rest of Congress, and develop legislative initiatives.

Mr. Chairman, thank you and your committee colleagues for hearing my comments.