Wednesday, December 3, 2014

Immigration Update: 89,700,000 Bad W-2s: IG ‘Concerned About SSN Misuse by Noncitizens Not Authorized to Work’

12/3/2014

Sen. Chuck Schumer (AP Photo/J. Scott Applewhite)

According to a new report from its Office of the Inspector General, the Social Security Administration received 89.7 million W-2s in the ten years from 2003 through 2012 that it cannot attribute to any legal worker in the United States because the name and Social Security Number on the W-2 do not match.


“We remain concerned about SSN misuse by noncitizens who are not authorized to work in the United States as well as the misuse of SSNs for identity theft purposes,” the IG says in the report.
The Social Security taxes paid on these no-match W-2s are put into what SSA calls the “Earnings Suspense File” and are not credited to any worker. Nearly fifteen years ago, the IG issued a report warning that the number of these types of earnings reports was growing—and linked them to the employment of illegal aliens.
“The ESF contains wage items that fail to match SSA name and SSN records,” the IG said in a report published on Feb. 7, 2000.
“SSA officials informed us that they suspect illegal aliens account for a major portion of suspended wage items, but the ESF Tactical Plan does not adequately address the problem,” said that IG report issued almost fifteen years ago.
“According to SSA officials," said he report, "illegal aliens may be major contributors to this problem. SSA suspects that employers in certain high turnover industries (bars and restaurants, services, and agriculture) compound the problem because they may knowingly hire illegal aliens with fraudulent identification and are able to do so because there are no penalties imposed for their actions.
“Consequently,” the report concluded, “those employers who knowingly accept fraudulent documentation are free to conduct business as usual without regard to the disruption and harm caused to SSA's customers and to unknowing individuals whose identities are falsely used."
A report issued by the Government Accountability Office in February 2005 backed up the IG’s conclusion that no-match W-2s tended to be concentrated in certain industries.
The GAO said its analysis was “consistent with an analysis reported by SSA’s OIG. In September 1999, the OIG examined earnings reports from 100 employers with the most suspended wage items. OIG reported that 67 percent of these employers were in industries that it categorized as services, restaurants, and agriculture. It also noted that SSA’s experience is that employers who rely on a workforce consisting of relatively unskilled or migrant workers are the major source of suspended earnings reports."
On May 20, 2013, when the comprehensive immigration reform bill favored by President Obama was being considered in the Senate Judiciary Committee, Sen. Chuck Grassley offered an amendment. It simply said that illegal aliens—who were going to be put on a path to citizenship—would first be required to reveal all the names and Social Security Numbers they had used when illegally working in the United States.
Sen. Chuck Schumer objected to the amendment, arguing that it was unreasonable to expect illegal aliens to remember all the false identities and Social Security Numbers they used.
“When people are living in undocumented status, there are times, I suppose, when they've made up identities, made up Social Security numbers," Schumer said. "How are they going to remember all that, and are we going to delay RPI status?"
"We all know when they lived in the shadows, they had to forge documents, forge Social Security numbers, et cetera. We want to stop that once and for all so it never happens again," said Schumer.
"I just don't see how, when you've lived here 10 years, and you've had many different identities, many different numbers, you're going to remember them all," said Schumer.
In its report on “major management and performance challenges” for SSA, published on Nov. 10, 2014, the SSA’s Office of Inspector General said an additional 89.7 million no-match W-2s had accumulated in the SSA’s records over the most recent ten years on record. These included 6.9 million in 2012.
“The Earnings Suspense File (ESF) is the Agency’s repository of wage reports on which wage earners’ names and SSNs fail to match SSA’s records,” said the IG. “Per the latest available data, the ESF had accumulated over $1.2 trillion in wages and 333 million wage items for Tax Years 1937 through 2012. In Tax Year 2012 alone, SSA posted 6.9 million wage items, representing $71 billion, to the ESF. From Tax Years 2003 to 2012, the ESF grew by approximately $749 billion in wages and 89.7 million wage items, representing about 62 percent of the total wages and 26 percent of the total wage items.”

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