U.S. Sen. Bill Cassidy (R-LA), a member of the Senate Committee on Finance, teamed up with a bipartisan group of colleagues to urge the U.S. Social Security Administration (SSA) to better protect Americans from identity fraud and theft in an era of rapid financial transactions.
Along with U.S. Sens. Claire McCaskill (D-MO), Tim Scott (R-SC) and Gary Peters (D-MI), Cassidy raised concerns with the SSA over the practice of synthetic identity theft, which they noted involves creating a false identity by combining several persons’ actual data and made-up information.
Synthetic identity theft “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 senators wrote in a Feb. 12 letter to SSA Acting Commissioner Nancy Berryhill.
“This issue has been exacerbated as consumers’ expectations around ‘instant’ delivery of financial products and services have evolved,” the lawmakers wrote.
The senators requested that SSA modernize its Consent-Based Social Security Number Verification system (CBSV) to combat the problem while securely enabling businesses to quickly process consumer transactions. The CBSV program requires the private sector to obtain an individual’s consent to verify if a given name, date of birth and Social Security number (SSN) match a government-issued source, according to the letter.
However, the CBSV has been hindered by its requirement that users of the program obtain a person’s actual written signature before using the database, an action the senators said “negates the utility of CBSV to combat synthetic identity fraud,” and slows down the ability of financial institutions to make rapid determinations on consumer financial products.
The lawmakers pointed out that because the federal government encourages electronic signatures under current law and is modernizing the U.S. information technology infrastructure, “we strongly believe that SSA should make provisions to accept the consent of an individual electronically in order to access CBSV.”
Additionally, private sector end-users pay enrollment fees and per-transaction fees that fund CBSV operational costs. “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,” the senators added.