|
Washington
- U.S.
Senator
Tim
Scott
(R-SC)
joins
his
colleagues
Senators
Bill
Cassidy,
M.D.
(R-LA),
Claire
McCaskill
(D-MO),
and
Gary
Peters
(D-MI)
in
urging
the
Social
Security
Administration
(SSA)
to
accept
individuals’
consent
electronically
in
order
to
help
financial
institutions
better
prevent
identity
theft
and
fraud.
“[T]he
SSA
requirement
that
users
of
the
CBSV
[Consent
Based
Social
Security
Number
Verification]
system
first
obtain
the
written,
physical
signature
of
the
individual
prior
to
accessing
the
database
unnecessarily
impedes
CBSV's
usefulness
in
preventing
identity
theft,”
states
the
senators’
letter
to
SSA
Acting
Commissioner
Nancy
Berryhill.
“Given
the
push
by
SSA
and
the
broader
federal
government
to
modernize
IT
infrastructure,
we
strongly
believe
that
SSA
should
make
provisions
to
accept
the
consent
of
an
individual
electronically
in
order
to
access
CBSV.”
Last
year
a
man
in
Rock
Hill,
SC
was
arrested
for
synthetic
ID
fraud,
with
his
indictment
stating
he
submitted
“more
than
750
new
credit
card
applications
to
financial
institutions
via
the
internet
and
by
telephone,
using
synthetic
identity
information.”
A
recent
study
predicted
that
financial
losses
attributed
to
synthetic
ID
theft
have
doubled
since
2014.
The
full
text
of
the
senators’
letter
is
below:
Dear
Acting
Commissioner
Berryhill:
We
write
regarding
the
growing
problem
of
synthetic
identity
fraud.
The
Government
Accountability
Office
describes
synthetic
identity
fraud
as
involving
“…the
creation
of
a
fictitious
identity,
typically
by
using
a
combination
of
real
data
from
multiple
individuals
and
fabricated
information.”
This
type
of
fraud
most
often
impacts
vulnerable
populations
–
particularly
children,
given
that
their
Social
Security
Number
(SSN)
is
not
yet
associated
with
any
live
borrowers
–
and
is
estimated
to
result
in
losses
of
$6
billion
per
year.
The
data
points
often
used
by
criminals
to
commit
synthetic
identity
fraud
are
stolen,
but
valid.
The
SSNs
are
paired
with
fabricated
identity
information,
such
as
names
and
dates-of-birth
(DOBs).
Criminals
are
able
to
exploit
these
data
points
because
there
is
no
efficient,
modern
method
to
confirm
that
a
name,
SSN,
and
DOB
belong
to
a
real
person.
This
issue
has
been
exacerbated
as
consumers’
expectations
around
“instant”
delivery
of
financial
products
and
services
have
evolved.
The
Social
Security
Administration
(SSA)
recognized
the
need
to
address
this
issue
when,
in
2002,
it
created
the
Social
Security
Number
Verification
Pilot
for
Private
Business
program.
The
creation
of
this
program
acknowledges
that
the
private
sector
–
particularly
financial
institutions
–
needed
the
ability
(with
the
individual’s
consent)
to
verify
whether
a
given
name,
DOB,
and
SSN
match
a
government-derived
source
of
truth
in
order
to
fight
fraud.
That
pilot
program
has
since
evolved
into
today’s
Consent-Based
Social
Security
Number
Verification
system
(CBSV),
which
serves
the
same
role.
The
CBSV
can
and
should
serve
as
a
powerful
tool
to
protect
vulnerable
populations
from
identity
theft.
However,
the
SSA
requirement
that
users
of
the
CBSV
system
first
obtain
the
written,
physical
signature
of
the
individual
prior
to
accessing
the
database
unnecessarily
impedes
CBSV’s
usefulness
in
preventing
identity
theft.
While
some
financial
transactions,
such
as
mortgage
applications,
are
still
paper-intensive,
rapid
technological
change
has
made
access
to
many
financial
products
and
services
increasingly
digital
with
instant
access.
In
situations,
where
consumers
expect
-
and
financial
institutions
often
make
–
quick
determinations,
the
physical
signature
requirement
negates
the
utility
of
CBSV
to
combat
synthetic
identity
fraud.
Given
the
push
by
SSA
and
the
broader
federal
government
to
modernize
IT
infrastructure,
we
strongly
believe
that
SSA
should
make
provisions
to
accept
the
consent
of
an
individual
electronically
in
order
to
access
CBSV.
It
is
within
your
authority
to
make
this
reasonable
and
overdue
change
to
accept
consent
electronically
without
new
legislation.
The
Social
Security
Act
provides
authority
and
flexibility
for
the
head
of
SSA
to
determine
appropriate
parameters
surrounding
requests
for
information
and
services
by
private
entities.
It
has
long
been
government
policy
to
encourage
electronic
signatures.
Two
relevant
federal
statutes
-
the
Electronic
Signatures
in
Global
and
National
Commerce
Act
(E-SIGN)
and
the
Government
Paperwork
Elimination
Act
(GPEA)
–
encourage
acceptance
of
e-signatures.
For
example,
as
the
Office
of
Management
and
Budget
(OMB)
points
out,
GPEA
“…specifically
states
that
electronic
records
and
their
related
electronic
signatures
are
not
to
be
denied
legal
effect,
validity,
or
enforceability
merely
because
they
are
in
electronic
form,
and
encourages
Federal
government
use
of
a
range
of
electronic
signature
alternatives.”
In
our
view,
a
consumer’s
consent
given
electronically
and
received
by
a
financial
institution
in
order
to
access
the
CBSV
is
clearly
in
the
spirit
of
both
of
these
laws.
We
are
very
sensitive
to
privacy
concerns,
particularly
when
SSNs
and
other
personally
identifiable
information
of
consumers
are
involved.
We
are
pleased,
therefore,
that
the
only
information
provided
to
users
of
the
CBSV
system
are
machine-to-machine
numerical
responses
corresponding
to
“yes,”
“no,”
or,
“deceased.”
We
would
not
expect
SSA
to
provide
users
of
the
CBSV
any
information
on
individuals
beyond
this.
Also,
as
you
look
to
modernize
the
hardware
and
software
of
the
CBSV
system,
we
encourage
you
to
ensure
the
security
and
integrity
of
the
system
are
maintained.
The
operational
costs
of
the
CBSV
are
funded
through
enrollment
fees
and
per-transaction
fees
paid
by
end-users
of
the
system.
In
fact,
to
fund
initial
start-up
costs
to
build
the
original
system,
SSA
asked
participating
private
sector
firms
to:
1)
pay
an
initiation
fee
and
2)
pay
upfront
for
their
estimated
annual
transactions.
Since
private
sector
end-users
of
CBSV
seem
willing
to
maintain
and
support
this
funding
structure,
we
see
no
budgetary
concerns
that
should
negatively
affect
your
decision
to
upgrade
and
modernize
this
system
to
handle
expanded
demand
and
ensure
near-continuous
availability.
Thank
you
for
your
attention
to
this
critical
issue
and
interest
in
fighting
synthetic
identity
fraud.
We
look
forward
to
working
with
SSA
to
better
protect
our
constituents
against
this
crime.
Sincerely,
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