E-Verify in Hot Water about Error Rate

An SHRM (Society for Human Resource Management http://shrmjax.org/pdfs/08-0447%202nd%20Quarter%202008.pdf) backed bill launched an employment verification debate on the other side of the pond. Apparently monster-sized databases are debated around the world, not just in the UK.
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Mark Schoeff Jr reports for Workforce Week


With momentum building for Congress to address comprehensive immigration reform later this year, two members of the House have introduced a bill to put employment verification at the center of the debate.

Written by Reps. Gabrielle Giffords, D-Arizona, and Sam Johnson, R-Texas, the measure would establish a mandatory electronic verification system that replaces an existing government-run system that has been roundly criticized by employer groups.

Giffords and Johnson hope their bill, the New Employee Verification Act, will either be the foundation for work-site enforcement in a broader immigration bill or move through Congress on its own.

The bill was introduced Wednesday, April 22, and announced by Giffords and Johnson on Thursday, April 23. It was originally offered in the previous Congress but had to be reintroduced because it did not become law.

The legislation mandates that all employers sign up for the Electronic Employment Verification System, which is based on the new-hire system used in each state to enforce child support payments. About 90 percent of employers use the new-hire system already.

Information for recently hired employees would be checked against Social Security and Department of Homeland Security databases to determine work eligibility. The system would eliminate the I-9 immigration form.

Alternatively, employers could register for the Secure Electronic Employment Verification System, a network of government-certified private sector companies that would authenticate a workers’ identity through a biometric identifier like a thumbprint.

The bill would establish civil and criminal penalties for employers that knowingly hire illegal immigrants.

Giffords and Johnson have been working with the HR Initiative for a Legal Workforce on the legislation. The organization is led by the Society for Human Resource Management and also includes the HR Policy Association and the National Association of Manufacturers.

The HR groups have led a charge against E-Verify, the government-run electronic verification system that is currently used on a voluntary basis by 118,917 employers.

“E-Verify’s significant error rate and reliance on paper-based identity documents often deny legal workers employment and can lead to fraud and identity theft,” the HR Initiative wrote in an April 23 letter to members of Congress. “Employers, in turn, are left vulnerable to sanctions through no fault of their own.”

E-Verify detractors say that the 4.1 percent error rate in the Social Security database could lead to millions of people being incorrectly ruled ineligible for work.

E-Verify proponents, which include many Republicans and conservative Democrats, say that the system confirms 96 percent of queries instantly and has an error rate of less than 1 percent.

Like E-Verify, the Electronic Employee Verification System would rely on the Social Security database. But the Giffords-Johnson bill requires that the Social Security information be cleaned up before the new system is launched.

In a conference call with reporters Thursday, Giffords called the proposal a “simple, effective, balanced alternative to E-Verify. It is a realistic piece of legislation.”

She also touted a provision that would establish federal pre-emption of state laws on employment verification. Her home state of Arizona was the first of several to mandate that employers use E-Verify—an experiment that is not succeeding, according to Giffords.

“Immigration is in the federal purview,” she said. “We should be dealing with it at the congressional level, not piecemeal state by state.”

It’s not yet clear when Congress will take up immigration reform. A comprehensive bill sparked political combustion in 2007 and died in the Senate. In the last couple weeks, the Obama administration has indicated it wants to address comprehensive immigration this year.

So far, individual dimensions of reform—such as verification and employment visas—have not been able to move on their own. But E-Verify is scheduled to expire on September 30, which might give work-site enforcement separate momentum.

Johnson says the electronic verification bill doesn’t have to be held up until comprehensive reform is complete.

“This year, we stand a great chance of passing it out of the House and Senate,” Johnson said. “It doesn’t have to wait. It can be combined later.”

As the immigration debate gets under way, HR organizations are trying to influence the outcome, especially on verification.

“SHRM feels strongly that employers should be part of the solution to illegal immigration,” said Mike Aitken, SHRM director of government affairs.

Small finance houses need to do more to keep out rogue clients

Large financial institutions are quite stringent when it comes to screening their suppliers. Due diligence can be thorough and exhaustive. Small to medium financial firms often satisfy themselves with much less. An email, a credit or media check may be enough to satisfy them. The FSA in a consultation paper issued last year, stated that financial institutions should vet their suppliers and other third parties to ensure that they have sufficient controls to ensure data security. In addition, companies should take the time to check the publicly available sanctions list on the Treasury's website, to make sure that they are not providing financial services to rogue firms and money launderers.

Patrick Hosking and Michael Herman report in The Times:
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The Financial Services Authority (FSA) said last night that many small and medium-sized financial institutions have insufficient command and controls to prevent them doing business with those on the Government's blacklist of financial sanctions.The list, which is maintained by the Treasury, includes about 1,400 individuals and 500 entities in Britain and abroad. It includes individuals and businesses linked to al-Qaeda, the Taliban as well as North Korea and Iran and people linked more generally to terrorist financing.Providing banking or other financial services to members of the list can be a criminal offence and businesses are required to have sufficient controls in place to avoid this.After surveying 228 financial firms, the FSA concluded: “There is significant scope across the industry for improvement in firms' systems and controls.” Leading financial institutions were also said to be “falling short”. The report highlighted one specific area of ignorance among British firms: a widespread belief that the sanctions applied only to foreign entities and individuals. In fact, the FSA reminded financial businesses that the banned list contains 50 individuals and 12 entities based in the UK.It also said that there was widespread confusion about the sanctions regime, with many firms believing that it took affect only with financial transactions above a certain size and therefore exempted smaller businesses.Another failing was that many firms were screening new clients retrospectively, sometimes weeks after an initial account had been opened, instead of before clients were taken on.The Treasury is responsible for policing firms that break the sanctions, but the FSA's remit includes making sure that UK financial groups have sufficient systems in place to prevent them from accepting blacklisted clients.

Launch of CRB's new Vetting and Barring Scheme

The Criminal Records Bureau is overhauling their process and introducing a new Vetting and Barring Scheme designed to offer a more stream-lined, faster system of workplace vetting for those working with children and vulnerable adults. There w ill be no significant changes for financial institutions who apply for Standard Disclosures for Approved Persons. The main change initially will be that Standard CRB checks will no longer be available for those working with children or the vulnerable; all such individuals will be entitled to an Enhanced check.

Read below for the announcement from the CRB:
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Today, the Home Office announced new measures to protect the vulnerable with the launch of the new Vetting and Barring Scheme later this year.

The changes planned for 12 October 2009 and the new safeguards that will be introduced to enhance the protection of children and vulnerable adults are outlined below.

From 12 October 2009:

The creation of two new ISA barred lists. These lists will replace the existing List 99 and POCA, POVA Lists.
Access to these new ISA lists will be available on request as part of an Enhanced CRB check.
Eligibility for Enhanced CRB checks will expand to include more employment and voluntary positions; such roles will be known as regulated positions.
Standard CRB checks will no longer be available for those working with children or the vulnerable.
There is no change to the current application form or application process.

From July 2010:
Individuals will be able, via Registered/Umbrella Bodies, to apply to the CRB for ISA-registration if they are applying to work with children and/or vulnerable adults in England, Wales and Northern Ireland. There will be a 5 year phased roll out for ISA registration of those individuals who currently work with children and/or vulnerable adults.
Employers will be able to express an interest in a person’s ISA-registration and informed of any changes to that person’s ISA-registration status.
The CRB will introduce a new application form to allow applications for ISA-registration and CRB checks to be made on the same form.
Employers can carry out free, online checks of a person’s ISA-registration status.
From November 2010:
It will be a legal requirement for individuals to register with the ISA if they intend to work or currently work with children and/or vulnerable adults in England, Wales and Northern Ireland.

For more information about the full range of safeguards and the dates when each one comes into force, please click here to view the full Home Office press release.
For the latest information coming out from the ISA and its new service please visit the ISA’s website (www.isa-gov.org) where you can register to receive regular updates.