O f ice of t e I pe ct Ge ne ral f h ns or K e nne t S.

A pf l
h e Com m is s ione r of Social curit Se y
I pe ct Ge ne ral
ns or Paym e nt of Be ne f s t I it o ndiv idual
W h o D o Not H av Th e ir O w n Social curit s e Se y Num be r Th e at ach e d f t inal port pre s e nt t e re s ul of our audit of t e paym e nt of re s h t s h be ne f s t indiv it o idual w h o do not h av t e ir ow n Social curit num be r (SSN) s e h Se y (A-04-9 6-42000) Th e obj ct e of t e audit w as t re v w Social curit . e iv h o ie Se y Adm inis trat ion pol s and proce dure s t re cord and v rif SSNs us e d by auxil icie o e y iary and s ur iv be ne f v or iciarie s be f ore approv t l I ing ite Ipaym e nt . s You m ay w is h t com m e nt on any f o urth e r act ion t e n or cont m pl e d on our ak e at re com m e ndat ions . I fyou ch oos e t of e r com m e nt , plas e prov t e m w it in o f s e ide h h t e ne xt 60 days . I h fyou w is h t dis cus s t e f o h inal port, plas e calm e or h av re e l e your s t f cont af act P e l J. Gardine r, Assist am a ant I pe ct Ge ne ral or Audit at ns or f , (410)9 65-9 700.

D av C. W il s id l iam A t ach m e nt t cc:
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G/ I Re ading Fil
O e e O A Re ading Fil Subj ct Fil e e B.A L EXA ND ER:bm c(cl)2-25-9 8 h 9 6-42000.FNL

E X E CUTIVE S U M M A R Y

O BJECTI E V
Th e obj ct e of t is audit w as t re v w Social curit Adm inis trat e iv h o ie Se y ion (SSA ) pol s and proce dure s t re cord and v rif Social curit num be rs (SSN)us e d icie o e y Se y by auxil and s ur iv be ne f iary v or iciarie s be f ore approv t l I ing ite Ipaym e nt . s

BACKGROUND
D uring 19 9 6, SSA paid about $ bil t 12.3 m il auxil and s ur iv 73 l o ion l ion iary v or be ne f iciarie s of t e O l ge , Sur iv and D is abily I urance (O A SD I h d-A v ors it ns )program unde r tite I l Iof t e Social curit Act 1 I a re port is s ue d by t e D e partm e nt of h Se y . n h H e al and H um an Se r ice s , O f ice of I pe ct Ge ne ral H S/ I 2 on t h v f ns or (H O G) January 23, 19 87, it w as not d t at a s ignif e h icant num be r of auxil and s ur iv iary v or be ne f iciarie s w h o w e re re ce iv be ne f s did not h av SSNs re corde d or v rif d in ing it e e ie ane SSA s y s t m s . I re s pons e t our findings , t e Te ch nical e n o h and M is ce l ous l Re v nue A ct (Publ L (P.L e ic aw .)100-647)w as e nact d on Nov m be r 10, 19 87. e e Th e A ct re q uire d t at af e r June 1, 19 89 , albe ne f h t l iciarie s f urnis h proof of an SSN or e v nce of appl ion f an SSN in orde r to re ce iv be ne f s . ide icat or e it W it t e e nact e nt of P . 100-647, SSA im plm e nt d ce rtain proce dure s h h m .L e e re q uiring be ne f iciarie s t prov proof of a v id SSN or to appl f an SSN o ide al y or be f ore re ce iv be ne f s .3 For e xam pl, SSA proce dure s now re q uire f l of ice s ing it e ie d f (FO ) t annot e a cl ant s SSN on e it e r th e M ode rnize d Cl s Syst m (M CS) o at aim h aim e ’ or a m anual l f c aim orm during t e appl ion proce s s . I cl ant doe s not h av h icat fa aim e e h orm at cont ion aine d in an SSN or prov s a num be r th at doe s not re concil w it inf ide ot e r SSA s y s t m s , FO s are re q uire d t re s ole t e dis cre pancy be f h e o v h ore t e cl is h aim pl d in curre nt pay s t us . ace at I t e e v nt t at a cl ant is is s ue d be ne f s b e f n h e h aim it ore an accurat SSN is obt e aine d, SSA im plm e nt d t e Be ne f e e h iciary’ O w n Social curit Num be r (BO SSN)alrt s Se y e
O A SDIbe ne f s are paid t re t d or dis abld w ork e rs and t e ir q ualie d de pe nde nt or s ur iv . it o ire e h if s v ors Th e s e de pe nde nt or s ur iv are re f rre d t as auxil or s ur iv be ne f s v ors e o iary v or iciarie s . Th e H H S/ I re port w as e nt ld, Re v w of P O G ite ie aym e nt t Auxil Be ne f s o iary iciarie s W it out Th e ir h O w n Social curit Num be r (CI A -13-86-62608) Se y N: . SSA’ Program O pe rat s ions M anual Syst m , RM 00207.035(A ) e (1)w as re v e d t re ad, “ l ough is o At h , ite Ic aim not re q uire d f e nt lm e nt e ach t l I l ant e nt ld June 19 89 or l e r m us t h av and prov or ite ite at e ide y or o e it an SSN, or m us t appl f an SSN t re ce iv be ne f s .” i
3 2 1

proce s s . W it t is program , FO s are not ie d v a BO SSN alrt w h e n be ne f s are h h if ia e it 4 aw arde d t a cl ant w it e it e r a m is s ing or unv rif d SSN. Th e alrts are o aim h h e ie e is s ue d on a bim ont l bas is unt t e corre ct SSN or nam e or dat of birth h as h y il h e be e n am e nde d in t e appropriat SSA s y s t m . Bas e d on dat obt h e e a aine d from SSA , e or iciarie s during t e m ont s of h h t e A ge ncy is s ue d BO SSN alrts f 29 ,705 be ne f h M arch and A pril 9 7. 19 To accom pl h our obj ct e , w e re v w e d l s , re gul
ions , and SSA proce dure s is e iv ie aw at re q uiring SSNs as a condit ion f re ce ipt of be ne f s . W e alo h e l dis cus s ions
or it s d w it SSA pe rs onne l o de t rm ine t e proce dure s us e d t proce s s be ne f h t e h o iciary v y, cl s and re s ole BO SSN alrts . Addit aim e ional w e anal d M as t r Be ne f l yze e iciary Re cords (M BR)and ot e r appropriat s y s t m q ue rie s (e .g., Num ide nt , h e e s A l a-I x re ports , and D e v l e nt W ork s h e e t ) f a j ph nde e opm s or udgm e nt l e lct d al y-s e e s am pl of 129 be ne f e iciarie s . Be caus e our s am pl w as j e udgm e nt l s e lct d, w e al y e e did not proj ct t e re s ul t t e t al e h t o h s ot popul ion of unv rif d or m is s ing SSNs . at e ie W e pe rform e d our audit w ork at SSA FO s l e d in Birm ingh am and ocat Tal ga, A l l ade abam a, and v t lph one dis cus s ions w it SSA pe rs onne l ia e e h in H ous t on, Te xas ; rl O ando, Fl orida; ine ol Ne w York ; M a, and L V gas , Ne v as e ada. Fie l w ork w as pe rform e d be t e e n O ct r 19 9 6 and Se pt m be r 19 9 7. d w obe e

RESUL O F REV EW TS I
A l ough SSA h as im plm e nt d proce dure s de s igne d t com pl w it t e t h e e o y h h prov ions of P . 100-647, SSA ’ b e ne f is .L icat s iciary appl ion and paym e nt proce s s e s cont inue t aw ard be ne f s t auxil s ur iv cl ant w it unk now n or o it o iary/ v or aim s h y, 19 it o unv rif d SSNs . Spe cif l during M arch and A pril 9 7, SSA paid be ne f s t e ie ical 29 ,705 be ne f iciarie s w h o h ad m is s ing or unv rif d SSNs . e ie Ev n t ough FO s w e re alrte d t t e m is s ing and dis cre pant inf e h e o h orm at on a ion ound t at t e be ne f h h iciarie s incl d in our s am pl h ad be e n ude bim ont l bas is , w e f h y e in curre nt pay s t us f an av rage of 3½ ye ars (ranging from 1 m ont t ov r at or e h o e 7 ye ars )w it out any corre ct e act h iv ion t e n. I t al t e 129 be ne f ak n ot , h iciarie s e xam ine d h ad be e n paid $ 2.2 m il in t l I ne f s b e t e e n t e dat s t at t e y l ion ite Ibe it w h e h h y ite o ie e h w e re init l e nt ld t be ne f s and A pril ial it 30, 19 9 7. A s s uch , w e be l v t at f urth e r e f orts coul be t e n t s tre ngt e n control w it in SSA ’ cl s f d ak o h s h s aim appl ion proce s s t e ns ure com pl icat o iance w it t e l and A ge ncy re q uire m e nt . h h aw s I addit n ion t s om e t e s lngt y de l s in re cording and v rif o im e h ay e ying SSNs , SSA ’ s pract of paying be ne f s t cl ant w h o h av m is s ing or unv rif d SSNs h as ice it o aim s e e ie an im pact on paym e nt accuracy. For e xam pl, w it in a s am pl of 54 BO SSN e h e
A n “ e rif d”SSN occurs w h e n a cl ant prov s an SSN, nam e , or dat of birth t at doe s unv ie aim ide e h e h orm at al ady annot e d on SSA ’ Num ide nt m as t r fil f th at indiv ion re s e . not re concil w it inf at e or idual ii
4

alrts w it m is s ing SSNs , w e ide nt ie d $ ,609 in ov rpaym e nt and incorre ct e h if 19 e s paym e nt t 4 be ne f s o iciarie s . Spe cif l w e ide nt ie d t re e be ne f ical y, if h iciarie s w it h m is s ing SSNs w h o h ad e xce e de d annual arnings l it ions and w e re e im at s ubs e q ue nty ov rpaid $ l e 4,444. Addit ional w e de t ct d anot e r be ne f l y, e e h iciary w it h a m is s ing SSN w h o h ad die d ov r 2 ye ars b e f e ore SSA t rm inat d h is b e ne f s . As e e it a re s ul SSA m ade paym e nt of $ t , s 15,165 in e rror. Th e abov ov rpaym e nt and e e s incorre ct paym e nt w e re not pre v nt d or de t ct d by SSA be caus e t e SSNs s e e e e h w e re m is s ing from t e M BR and, t e re f , not m at e d s ucce s s f l t annual h h ore ch ul o y e arnings or St e de at dat at h a.

RECO M M END A TI NS O
W e re com m e nd t at SSA re s ole alout t h v l s anding m is s ing and unv rif d SSNs in a e ie t e l m anne r. W e alo re com m e nd t at SSA re cov r ov rpaym e nt m ade t t e im y s h e e s o h t re e ide nt ie d be ne f h if iciarie s w h o h ad e arnings in e xce s s of t e annualim it ions h l at and s e e k re s t ut it ion of be ne f s w rongl paid t a cl ant af e r h is d e at .5 it y o aim t h Addit ional w e re com m e nd t at SSA im prov control by re q uiring m anage m e nt l y, h e s approv t ov rride s y s t m e dit d e s igne d t pre cl t e aw ard of be ne f s t al o e e s o ude h it o cl ant w it an unv rif d SSN. Final w e re com m e nd t at SSA is s ue a aim s h e ie l y, h m e m orandum t alpe rs onne l s pons ibl f proce s s ing cl appl ions t at o l re e or aim icat h w ilre e m ph as ize t e im portance of f l ing e s t is h e d proce dure s s o t at a l h ol ow abl h prope r de t rm inat e ion of e l it igibily can be m ade .

AGENCY CO M M ENTS
I it w rit e n re s pons e t our draft re port, SSA agre e d w it f n s t o h our of t e f e h iv re com m e ndat ions . Spe cif l SSA s t e d t at it is al ady purs uing appropriat ical y, at h re e re m e die s f th e cas e s in w h ich ov rpaym e nt and incorre ct paym e nt w e re or e s s ide nt ie d. Furth e r, SSA pl t is s ue a m e m orandum t at w il 1)ins truct if : ans o h l pe rs onne l o re duce t e num be r of out t t h s anding alrts ; e 2)re e m ph as ize t e h im portance of f l ing e s t is h e d proce dure s ; ol ow abl and 3)e v uat s im il t al e ar ype cas e s f indicat or ions of fraud and m ak e appropriat re f rral t t e O f ice of t e e e s o h f h I pe ct Ge ne ral I . ns or (O G) SSA disagre e d w it our re com m e ndat h ion t at w oul re q uire SSA m anage m e nt h d approv t ov rride s y s t m e dit d e s igne d t pre cl t e aw ard of be ne f s t al o e e s o ude h it o cl ant w it an unv rif d SSN. I it re s pons e , SSA s t e d t at t e unv rif d aim s h e ie n s at h h e ie t w orm at ion e nt re d int M CS and e o SSNs re s ul from m inor dis cre pancie s be t e e n inf inf orm at ion s t d on t e Num ide nt Furth e r, SSA re s t e d t at t e O I audit did ore h . at h h G not re port a m one t ary e f e ct as s ociat d w it t e s am pl of be ne f f e h h e iciarie s w it h
W e h av alo re f rre d t is m at e r to O f ice of t e I pe ct Ge ne ral O f ice of I e s t ions t e s e h t f h ns or ’ f s nv igat o e l as s e s s w h e t e r pos t at be ne f ch e ck s w e re fraudulnty ne got e d/ is us e d. h -de h it iat m iii
5

unv rif d SSNs . Th e re f , SSA did not be l v t at re q uiring a m anage r’ re v w e ie ore ie e h s ie t ov rride t e e dit w oul be cos t f e ct e . Addit o e h d -e f iv ional SSA as s e rte d t at t is l y, h h control oul im pe de t e proce s s ing of t e cl . SSA did agre e t at t e s e w d h h aim h h dis cre pancie s s h oul be re s ole d in a t e l m anne r and w ilis s ue a m e m orandum v im y d l s s t appropriat s t f (Se e A ppe ndix A f th e f l e xt of t e A ge ncy’ com m e nt .) o e af . or ult h

O I RESPO NSE G
O ur re v w dis cl e d t at al ough SSA h as im plm e nt d proce dure s de s igne d t ie os h t h e e o com pl w it t e prov ions of P . 100-647, w e be l v t at f y h h is .L ie e h urth e r e f orts coul f d be t e n t s tre ngt e n control w it in SSA ’ cl s appl ion proce s s t e ns ure ak o h s aim s h icat o com pl iance w it lgal h e and A ge ncy re q uire m e nt . W h il
crit s e ical nt ying ide if inf orm at ion is com pare d t SSA ’ m as t r fils f alcl ant , an e dit doe s not
o s e e or l aim s pre v nt paym e nt w h e n dis cre pancie s e xis t SSA ’ pol s t e s t at if cl ant e . s icy at h aim inf orm at ion e nt re d in M CS doe s not re concil w it inf e e h orm at cont ion aine d in t e h M ode rnize d Enum e rat ion Sys t m (M ES) t o D e v l e nt W ork s h e e t is s ue s e , w e opm (it m s ne e ding re s ol ion)w ilbe propagat d. Th e pol alo s t e s t at M CS e ut l e icy s at h cont ains a re ce ipt dat f l in w h ich SSA pe rs onne l h oul e nt r th e dat e ie d s d e e e v nce w as pre s e nt d by t e cl ant t re s ole t e dis cre pancy (D e v l e nt ide e h aim o v h e opm W ork s h e e t is s ue ) H ow e v r, if SSA pe rs onne l ant t com plt proce s s ing of a . e w o e e cl and e v nce h as not be e n pre s e nt d t re s ole t e dis cre pancy, t e y m ay aim ide e o v h h e nt r s ix X’ in t e re ce ipt dat f l rat e r th an an act dat . e s h e ie d h ual e W e be l v t at t e incl ion of s ix X’ (XXXXXX)in t e re ce ipt dat f l of t e ie e h h us s h e ie d h D e v l e nt W ork s h e e t w it out m anage m e nt concurre nce circum v nt t e int nt e opm h e s h e . G f h ion and re q ue s t t at s h of t e control Cons e q ue nty, O I af irm s t is re com m e ndat h l SSA re cons ide r it pos it s ion on re q uiring m anage m e nt approv t ov rride s y s t m al o e e e dit d e s igne d t pre cl t e aw ard of be ne f s t cl ant w it an unv rif d s o ude h it o aim s h e ie SSN. Furth e r, if F pe rs onne l e re re q uire d t re s ole dis cre pancie s w h il O w o e v com plt e ing t e init cl s appl ion, t e ne e d f BO SSN alrts w oul be h ial aim icat h or e d re duce d s ignif icanty. l

iv

TA BL O F CO NTENTS
E
P age EXECUTI E SUM M A RY ..........................................................................i
V I NTRO D UCTI N ...................................................................................1
O RESUL O F REVEW ...........................................................................6
TS I TH E I PO RTA NCE O F V LD A TI M A I NG M I NG O R UNV F ED
SSI ERI I SSNs ..............................................................................................6
SSA ’ Com pl
s iance w it L gal q uire m e nt ...................................6 h e Re s O v rpaym e nt and I e s ncorre ct P aym e nt Re s ul d from M is s ing
s t e SSNs .........................................................................................7
Adm inis trat e Probl
s Re s ul from Unv rif d SSNs ...................8 iv em t ing e ie BO SSN A L ERTS NO T RESO L ED I A TI EL M A NNER .......................9
V N M Y CO NCL O N A ND RECO M M END A TI NS .............................................12
USI O A PPEND I CES
A ppe ndix A - Age ncy Com m e nt s
A ppe ndix B - M aj Re port Contribut or ors
A ppe ndix C - SSA O rganizat ional art
Ch

INTR O D UCTIO N

O BJECTI E V
Th e obj ct e of t is audit w as t re v w SSA pol s and proce dure s t re cord e iv h o ie icie o and v rif SSNs us e d by auxil and s ur iv be ne f e y iary v or iciarie s be f ore approv t l ing ite I Ipaym e nt . s

BACKGROUND
D uring 19 9 6, SSA paid about $ bil t 12.3 m il auxil and s ur iv 73 l o ion l ion iary v or be ne f iciarie s of t e O A SD Iprogram unde r tite I h l Iof t e Social curit Act h Se y . O A SD Ibe ne f s are paid t re t d or dis abld w ork e rs and t e ir q ualie d it o ire e h if de pe nde nt or s ur iv . SSA m aint s v ors ains re cords of be ne f iciarie s and be ne f it paym e nt by account num be rs . Th is account num be r is t e SSN of t e w age s h h e arne r on w h os e be h al be ne f s are paid. f it SSA ’ Cl Appl ion and Approv Proce dure s s aim icat al W h e n an auxil or s ur iv cl ant appl s f tite I ne f s , t e indiv iary v or aim ie or l Ibe it h idual is icant s nam e , dat of e re q uire d t prov s pe cif inf o ide ic orm at ion s uch as t e appl h ’ y, aim birth , and SSN t an SSA cl s re pre s e nt iv (CR) Typical t e s e cl s are o aim at e . l h m ade in pe rs on at an SSA FO by t e indiv h idual h is or h e r re pre s e nt iv (e .g., or at e pare nt guardian, re pre s e nt iv paye e ) I orm at , at e . nf ion and e v nce re q uire d f ide or adj udicat ion of a t l I l is outine d in SSA re gul ions . Addit ite Ic aim l at ional M CS l y, s cre e ns prom pt t e CR proce s s ing t e cl t obt h h aim o ain and input re q uire d inf orm at ion during t e init int r ie w . h ial e v D uring t e cl appl ion proce s s , M CS is com pare d t SSA ’ Num ide nt m as t r h aim icat o s e 6 f e . Th is int rface is driv n by t e SSN e nt re d in M CS f th e s ubj ct cl ant il e e h e or e aim . I fany inf orm at ion re garding t e cl ant doe s not m at dat cont h aim ch a aine d in t e h Num ide nt (e .g., nam e , dat of birth , SSN) a D e v l e nt W ork s h e e t is e , e opm propagat d indicat e ing t at a dis cre pancy e xis t w it t e cl ant s SSN. Th e h s h h aim ’ re s pons ibl CR is re q uire d t re s ole alD e v l e nt W ork s h e e t is s ue s be f e o v l e opm ore t e h cl is adj aim udicat d and be ne f s are aw arde d. I ce rtain cas e s , t e cl ant m us t e it n h aim com plt a Form SS-5, A ppl ion f a Social curit Num be r, t corre ct e e icat or Se y o inf orm at cont ion aine d on t e Num ide nt For e xam pl, if t e Num ide nt m as t r fil h . e h e e s h ow s a be ne f iciary’ m aide n nam e but t e pe rs on is f ing a cl unde r a m arrie d s h il aim
Th e Num ide nt m as t r fil cont e e ains alre lv e num e rat inf l e ant ion orm at (e .g., nam e , dat of birth , ion e s c.) or idual num be r h ol r. de m ot e r’ m aide n nam e , e t f e ach indiv h 1

6

nam e , an SS-5 s h oul be com plt d t re v e t e Num ide nt Al w it t e SS-5, d e e o is h . ong h h t is appl h icant w oul alo h av t prov e v nce t s upport th e nam e ch ange , d s e o ide ide o s uch as a m arriage ce rtif e . icat I cl ant doe s not h av an SSN w h e n h e or s h e appl s f be ne f s , fa aim e ie or it P . 100-647 and SSA proce dure s re q uire t at t e indiv .L h h idual com plt an SS-5 e e be f ore re ce iv paym e nt .7 A s w it alappl ing s h l icant f an SSN, t e cl ant w oul s or h aim d be re q uire d t prov e v nce of age , ide nt y, and U.S. cit ns h ip be f o ide ide it ize ore a num be r w as is s ue d. BO SSN A lrt Proce s s e BO SSN alrts are ge ne rat d t FO s w h e n t e M BR of an auxil or s ur iv e e o h iary v or be ne f iciary w h o appl d f be ne f s af e r June 1, 19 89 , cont ie or it t ains an unv rif d e ie SSN or is m is s ing an SSN. SSA im plm e nt d t o program s t ge ne rat BO SSN e e w o e e h l alrts : 1) t e M is ce l ous Corre ct ane ions program , w h ich init e s t e BO SSN iat h unv rif d alrt proce s s ; e ie ar t e and 2) t e Re gul Trans cript A t ainm e nt and Se lct h e ion P s program , w h ich init e s t e BO SSN m is s ing alrt proce s s . as iat h e BO SSN alrts are is s ue d on a bim ont l s ch e dul, w h ich is bas e d on be ne f e h y e iciarie s ’ init dat s of e nt lm e nt For e xam pl, if a cl ant be cam e e nt ld t be ne f s ial e ite . e aim ite o it in January 19 9 0, but did not prov an SSN during t e appl ion proce s s , a ide h icat BO SSN alrt w oul be ge ne rat d t t e FO t at proce s s e d t e cl e v ry odde d e o h h h aim e num be re d m ont (e .g., M arch , M ay, Jul e t h y, c.)unt t e SSN w as re corde d and il h v rif d in t e s y s t m . I t e cl ant be cam e e nt ld in Fe bruary 19 9 0, but e ie h e f h aim ite prov d a dif e re nt nam e or dat of birth t an al ady re corde d in SSA ’ ide f e h re s Num ide nt m as t r fil, an alrt w oul be is s ue d t t e re s pons ibl FO e v ry e e e d o h e e e v n-num be re d m ont (e .g., A pril June , Augus t e t e h , , c.)unt t e dis cre pant il h inf orm at ion w as re s ole d and corre ct d. v e Pre v ious A udit Findings I an audit re port e nt ld, “ v w of P n ite Re ie aym e nt t Auxil Be ne f s o iary iciarie s W it out h Th e ir O w n Social curit Num be r”(CI A -13-86-62608) is s ue d Se y N: , January 23, 19 87, H H S/ I not d t at t e l of SSNs f auxil be ne f O G e h h ack or iary iciarie s h ad a s ignif icant e f e ct on SSA 's abily t m onit paym e nt accuracy and t f it o or o de t ct and re cov r ov rpaym e nt . e e e s

Unt Augus t 19 9 7, h ow e v r, SSA did not adh e re t t is re q uire m e nt Spe cif l SSA il e o h . ical y, adj udicat d and aw arde d be ne f s t cl ant w h o did not prov an SSN. A ccording t SSA , a e it o aim s ide o e ude h udicat of a cl if ion aim re v e d v rs ion of M CS, re las e d on Augus t 25, 19 9 7, now pre cl s t e adj is e no SSN is prov d. ide 2

7

Spe cif l t e re port ide nt ie d t e f l ing f e are as t at coul be im prov d if ical h y, if h ol ow iv h d e be ne f iciarie s w e re re q uire d t prov e v nce of an SSN as a condit o ide ide ion of paym e nt . Prior Cl s / v rpaym e nt Re cov ry: Th e us e of an SSN as a pe rs onal nt ie r aim O e s e ide if w oul al SSA t dire cty re f re nce ov rpaym e nt t t e l e indiv ow o l d l e e s o h iabl idual o t at s h t e A ge ncy coul e ns ure col ct h d l ion from f ure be ne f s . For e xam pl, a 19 85 e ut it e Re cov ry of O v rpaym e nt Account e e , ing and Re porting m as t r fil incl d e e ude approxim at l 45,500 auxil be ne f e y iary iciarie s , re pre s e nt an e s t at d $ m il ing im e 29 l ion in ov rpaym e nt , f w h ich SSA did not h av SSNs re corde d. A s a re s ul t e e s or e t h , ov rpaym e nt coul not be dire cty re f re nce d f fut e s e or ure re cov ry s h oul t e e d h d l s ite o indiv idual b e com e e nt ld t be ne f s unde r th e ir ow n SSN or anot e r account it h num be r at a s ubs e q ue nt dat . Th e re f , re cov ry act it s w e re t rm inat d. e ore e iv ie e e A nnual Earnings / orce m e nt Re q uiring SSNs from appl Enf : icant / ne f s be iciarie s w oul d e o or im at or e e nabl SSA t m onit com pl iance w it t e annual arnings l it ion f th e ov r h h e 1.2 m il be ne f l h im h ion iciarie s w h o did not h av v id SSNs on re cord at t e t e t e e al re port w as is s ue d. St e D e at D at Th e com paris on of St e de at dat t be ne f at h a: at h a o iciary paym e nt re cords is k e ye d t t e SSN. Th e re f , be ne f o h ore iciarie s w it m is s ing or unv rif d h e ie SSNs are not s ubj ct t t e re v w prov d by t e St e de at dat m at . Th e e o h ie ide h at h a ch y if 32 l audit re port s t e d t at t e m at h ad s ucce s s f l ide nt ie d $ m il in at h h ch ul ion e rrone ous paym e nt w h e n SSNs w e re av l e . s ai abl D upl e P icat aym e nt D e t ct e ion: A t t e t e t e audit re port w as is s ue d, t e M as t r h im h h e Fil D upl ion D e t ct e icat e ion O pe rat ion (M A FDUP )us e d nam e , dat of birth , and e Z I code in a com put r m at de s igne d t de t ct dupl e paym e nt . Be caus e P e ch o e icat s unv rif d SSNs of e n prov d t be unre l e , t is crit rion w as not us e d in e ie t e o iabl h e M A FDUP H ow e v r, h ad t e SSNs b e e n v rif d, t is dat coul h av prov d . e h e ie h a d e e v uabl in t is d e t ct al e h e ion proce s s . Taxat ion of Be ne f s : Th e us e of SSNs w oul alo al SSA t prov t e it d s l ow o ide h I e rnal v nue Se r ice (I nt Re e v RS)w it be ne f paym e nt dat t at is com pat e w it h it a h ibl h I proce s s ing. H ow e v r, w it out SSNs , I m us t us e ot e r ls s -e f icie nt RS e h RS h e f ch anne l t as s e s s and col ctt s f be ne f s paid t indiv s o l axe or e it o idual w it out t is s h h inf orm at ion. A s a re s ul re v nue s attribut e t t s im pos e d on be ne f s m ay t , e abl o axe it not be re al d. ize H H S/ I re com m e nde d, am ong ot e r th ings , t at SSA s e e k lgis l iv aut orit t O G h h e at e h y o re q uire a v id SSN, or an appl ion f an SSN, as a pre re q uis it t re ce iv al icat or e o ing m ont l be ne f paym e nt . SSA agre e d and incl d in it Fis cal ar 19 88 h y it s ude s Ye L gis l iv Propos al a re com m e ndat e at e s ion t at auxil be ne f h iary iciarie s prov t e ir ide h

3

ow n SSNs as a re q uire m e nt f re ce ipt of be ne f s . Th is propos al as e nact d as or it w e part of P . 100-647, w h ich cont .L ains t e f l ing prov ion: h ol ow is Re q uire , as a condit ion f re ce iv Social curit be ne f s , t at or ing Se y it h y or is be ne f iciarie s e it e r furnis h t e ir SSN or appl f one . Th e prov ion is h h e f e ct e w it e nt lm e nt b e ginning af e r M ay 19 89 . f iv h ite s t Addit ional t e Social curit Act t l I, s e ct l h y, Se y , ite I ion 205(c) (F w as am e nde d t (2) ) o st e: at Th e Com m is s ione r of Social curit s h alre q uire , as a condit Se y l ion f re ce ipt or idual urnis h s at f ory proof of a f is act of be ne f s unde r th is t l, t at an indiv it ite h Social curit account num be r as s igne d t s uch indiv Se y o idual t e by h Com m is s ione r of Social curit or, in t e cas e of an indiv Se y h idual o w h om no t s uch num be r h as b e e n as s igne d, t at s uch indiv h idual ak e prope r m appl ion f as s ignm e nt of s uch a num be r. icat or

SCO PE AND M ETH O D O L GY O
Th e obj ct e of our audit w as t re v w SSA pol s and proce dure s t re cord e iv o ie icie o and v rif SSNs us e d by auxil and s ur iv be ne f e y iary v or iciarie s be f ore approv ing t lI ite Ipaym e nt . s To accom pl h our obj ct e , w e re v w e d l s and re gul ions re q uiring SSNs as is e iv ie aw at a condit ion f th e re ce ipt of be ne f s . W e alo conduct d dis cus s ions w it SSA or it s e h pe rs onne l o de t rm ine t e proce dure s us e d t proce s s be ne f t e h o iciary cl s and aim v re s ole BO SSN alrts . e Th e audit pe riod re v w e d be gan w it t e init dat of e nt lm e nt f e ach ie h h ial e ite or be ne f iciary incl d in our s am pl and e nde d on A pril ude e 30, 19 9 7. W e anal d yze ph nde M BRs , and ot e r appropriat s y s t m q ue rie s (e .g., Num ide nt , Al a-I x h e e s re ports , and D e v l e nt W ork s h e e t ) f th is j e opm s or udgm e nt l e lct d s am pl of al y-s e e e be ne f iciarie s . Th e s am pl incl d 54 be ne f e ude iciarie s from a popul ion of at 5,49 2 m is s ing SSNs t at F s w e re alrte d t in M arch 19 9 7. W e alo s e lct d h O e o s e e at e ie h 75 be ne f iciarie s from t e popul ion of 8,9 56 unv rif d SSNs t at FO s w e re h alrte d t in A pril 9 7. W e ch os e t e s e s am pl it m s from am ong t e FO s w it e o 19 h e e h h t e l s t num be r of alrts as f l s : 1) t e f t 20 m is s ing SSNs from 2 FO s h arge e ol ow h irs and a t al 14 ot e r m is s ing SSNs from 2 addit ot of h ional s ; FO and 2) t e f t h irs 5 unv rif d BO SSNs from e ach of 15 FO s . e ie Be caus e our s am pl w as j e udgm e nt l s e lct d, t e re s ul w e re not proj ct d t al y e e h t s e e o t e t al h ot popul ion of m is s ing and unv rif d SSNs . O ur re v w of docum e nt ion at e ie ie at and any ide nt ie d w e ak ne s s e s re l e d onl t t e it m s in our s am pl. if at y o h e e

4

W e re v w e d t os e int rnal ie h e control proce dure s ne ce s s ary t m e e t our obj ct e s . o e iv Audit w ork w as conduct d at t e SSA FO s l e d in Birm ingh am and Tal ga, e h ocat l ade Al h in on, Te xas ; abam a, and v t lph one dis cus s ions w it SSA pe rs onne l H ous t ia e e O rl ando, Fl orida; ine ol Ne w York ; M a, and L V gas , Ne v as e ada. Fie l w ork w as d pe rform e d be t e e n O ct r 19 9 6 and Se pt m be r 19 9 7. O ur audit w as conduct d w obe e e in accordance w it ge ne ral acce pt d gov rnm e nt audit h l y e e ing s t andards .

5

RESUL TS O F R E VIE W

Since t e e nact e nt of P . 100-647, SSA h as s ignif h m .L icanty re duce d t e num be r of l h auxil and s ur iv be ne f iary v or iciarie s w h o re ce iv be ne f paym e nt w it out a e it s h ow v rif d SSN. I 19 9 0, t e ye ar f l ing im plm e nt ion of t e l , SSA is s ue d e ie n h ol e at h aw approxim at l 116,000 BO SSN alrts . H ow e v r, during M arch and A pril 9 7,
e y e e 19 t e re w e re 29 ,705 be ne f h iciarie s w it m is s ing or unv rif d SSNs
h e ie (18,480 unv rif d and 11,225 m is s ing)in curre nt pay s t us .8 W h il
w e e ie at e ack now ldge t at SSA h as m ade cons ide rabl s tride s in im prov it pract of e h e ing s ice re cording be ne f iciary SSNs , w e be l v t at f ie e h urth e r e f orts coul be t e n t f d ak o s tre ngt e n control w it in SSA ’ cl s appl ion proce s s t e ns ure com pl h s h s aim icat o iance w it t e l and A ge ncy re q uire m e nt . h h aw s

TH E I PO RTANCE O F V LD A TI M A I NG M I NG O R UNV F ED SSNS SSI ERI I
I addit n ion t be ing contrary t lgal t at o o e s ipul ions , SSA ’ pract of paying be ne f s s ice it t cl ant w h o h av m is s ing or unv rif d SSNs h as an im pact on ot e r A ge ncy o aim s e e ie h re s pons ibilie s as discussed in t e f l ing re port s e ct it h ol ow ions . Spe cif l w it in ical y, h our s am pl of 54 m is s ing BO SSN alrts , w e ide nt ie d $ ,609 in ov rpaym e nt e if 19 e s e and incorre ct paym e nt t at can be attribut d t m is s ing SSNs f four s h e o or y, adv h h iv be ne f iciarie s . Addit ional SSA pe rs onne l is e d t at t e f e audit is s ue s l l outine d in t e H H S/ I 19 87 audit re port cont h O G inue t occur be caus e of unv rif d o e ie SSNs . A l ough FO s w e re alrte d t t e m is s ing and dis cre pant inf t h e o h orm at on a ion bim ont l bas is , w e f h y ound t at t e be ne f h h iciarie s incl d in our s am pl h ad be e n ude e in curre nt pay s t us f an av rage of 3½ ye ars (ranging from 1 m ont t ov r at or e h o e 7 ye ars )w it out any corre ct e act h iv ion t e n. I t al t e 129 be ne f ak n ot , h iciarie s ion ite Ibe e xam ine d h ad be e n paid $ 2.2 m il in t l I ne f s b e t e e n t e dat s t at t e y l it w h e h h w e re init l e nt ld t be ne f s and A pril ial y ite o it 30, 19 9 7. SSA ’ Com pl s iance w it L gal q uire m e nt h e Re s P.L 100-647 and SSA pol s re q uire be ne f . icie iciarie s t prov proof of an SSN or o ide t s ubm it an appl ion f an SSN be f o icat or ore re ce iv Social curit be ne f s . ing Se y it H ow e v r, at t e t e of our audit f l w ork , FO pe rs onne l e h im ie d coul proce s s be ne f d it
O ur s am pl cas e s w e re de riv d from a s ubs e t of t e 29 ,705 be ne f e e h iciarie s . Th is s ubs e t incl d ude e o 19 5,49 2 m is s ing SSNs and 8,9 56 unv rif d SSNs t at F s w e re alrte d t in M arch and A pril 9 7 e ie h O re s pe ct e l iv y. 6

8

paym e nt e v n t ough an SSN w as m is s ing or h ad not be e n v rif d. Spe cif l s e h e ie ical y, be f ore A ugus t 25, 19 9 7, t e A ge ncy’ aut at d s y s t m s did not pre cl h s om e e ude paym e nt t be ne f o iciarie s w it out an SSN. Addit h ional FO pe rs onne l l d y, coul bypas s ce rtain control w it in SSA ’ M CS t at w e re de s igne d t pre v nt adj s h s h o e udicat ion of s h ide e h cl s f indiv aim or idual t at prov d nam e s , dat s of birth , or SSNs t at did not agre e w it dat re corde d in ot e r SSA s y s t m s . h a h e A ccording t SSA FO pe rs onne l a ne w re las e of M CS, im plm e nt d on o , e e e Augus t 25, 19 9 7, cont ains a control h at pre v nt t e adj t e s h udicat ion and paym e nt of be ne f s t a be ne f it o iciary w it a m is s ing SSN. W e com m e nd SSA ’ e f orts t h s f o be t e r control h e init re cording of be ne f t t ial iciarie s SSNs . H ow e v r, as e xpl d e aine at h are ilabl o l e r in t is re port, SSA pe rs onne l s t l e t adj udicat cl s w h e n an SSN e aim is unv rif d. A s s uch , SSA pract s s t l ay not f l com pl w it lgal e ie ice ilm ul y h e y re q uire m e nt . s For e xam pl, w it in our s am pl of 75 unv rif d SSNs , w e ide nt ie d 10 e h e e ie if (13 pe rce nt f w h ich t e SSN appe aring on t e M BR w as incorre ct 9 Th e s e ) or h h . 10 indiv idual w e re paid $ ,325 ov r an av rage of al os t 4 ye ars . O ur re v w s 109 e e m ie s h ow e d t at a ce rtain am ount of t e s e incorre ct num be rs w e re attribut e t h h abl o clrical cl ant e rror. As point d out in a pre v e or aim e ious O I re port e nt ld, G ite “ v w of I e rnal Re ie nt Control in t e Social curit Adm inis trat s h Se y ion’ M ode rnize d s Cl s Syst m ”(A-04-9 5-06019 ) is s ue d M ay 16, 19 9 7, w it out v rif e SSNs , aim e , h e iabl e m pl e s h av t e opportunit t cre at f s e auxil and s ur iv cl s oye e h y o e al iary v or aim t rough im prope r us e of e xis t h ing SSNs . Ne v rth e ls s , in re s pons e t t is and e e o h pre v ious H H S/ I re ports , SSA m anage m e nt de cl d t im plm e nt control O G ine o e s de s igne d t 1)re q uire m anage m e nt approv f th e adj o: al or udicat ion of a cl w h e n aim t e be ne f h iciary’ SSN is unv rif d; s e ie and 2)pre v nt t e re s ol ion of BO SSN alrts e h ut e by t e s am e e m pl e w h o adj h oye udicat d t e original l . e h c aim O v rpaym e nt and I e s ncorre ct P aym e nt Re s ul d from M is s ing SSNs s t e O ur audit conf e d t at SSA ’ f ure t obt irm h s ail o ain and re cord SSNs f auxil or iary be ne f iciarie s h as an im pact on t e accuracy of SSA paym e nt . For e xam pl, of h s e t e 54 indiv h idual incl d in our s am pl f w h om SSA h ad no account num be r, s ude e or 3 (6 pe rce nt xce e de d annual arnings l it ions and w e re s ubs e q ue nty )e e im at l ov rpaid $ e 4,444 in be ne f s . Addit it ional w it in t e m is s ing BO SSNs re v w e d, l y, h h ie w e ide nt ie d incorre ct paym e nt of $ if s 15,165 t one be ne f o iciary (2 pe rce nt h o )w h ad die d ov r 2 ye ars b e f e ore paym e nt w e re t rm inat d. Th e ov rpaym e nt and s e e e s incorre ct paym e nt t t e s e indiv s o h idual w e re not pre v nt d or de t ct d by SSA s e e e e be caus e t e SSNs w e re m is s ing from t e M BR and, t e re f , not m at e d h h h ore ch s ucce s s f l t annual arnings or St e de at dat ul o y e at h a.
Th e re m aining 65 be ne f iciarie s incl d in t e unv rif d SSN s am pl h ad dis cre pancie s be t e e n ude h e ie e w e t e nam e s or dat s of birth as re corde d on t e M BR and t os e s h ow n on t e Num ide nt m as t r fil. h e h h h e 7

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A t t e t e of our audit f l w ork , SSA h ad an on-l e dit w it in M CS t at h im ie d ine h h cre at d a D e v l e nt W ork s h e e t t at ide nt ie s is s ue s t be re s ole d w h e ne v r e e opm v e h if o dis cre pant or m is s ing inf orm at ion w as e nt re d f a cl ant Th is s cre e n w as e or aim . icat int nde d t f it e t e re s ol ion of dis cre pancie s during t e appl ion proce s s . e o acilat h ut h H ow e v r, our obs e r at e v ions conf e d t at t e s e dis cre pancie s did not h av t be irm h h e o re s ole d be f v ore a cl w as adj aim udicat d and paym e nt is s ue d t t e be ne f e s o h iciary. For e xam pl, D e v l e nt W ork s h e e t f four be ne f e e opm s or iciarie s h ad a “”in pl of ? ace t e cl ant ’ h aim s SSNs . Ne v rth e ls s , SSA is s ue d paym e nt t t e s e indiv e e s o h idual f s or n ot , h an av rage of 2 ye ars w it out re cording v id SSNs . I t al t e 54 auxil e h al iary e e 1 l be ne f iciarie s incl d in our s am pl w e re paid ov r $ m il during our audit ude ion pe riod, e v n t ough SSA h ad no SSNs re corde d f th e s e indiv e h or idual. s A s e xpl d pre v aine ious l a ne w re v ion of M CS appe ars t h av prov d t e y, is o e ide h s o e urth e r paym e nt t be ne f s o iciarie s w it out SSNs . h control ne ce s s ary t pre v nt f A ccordingl w e w ilm ak e no re com m e ndat s y, l ions in t is re port re garding control in h t is are a. Ne v rth e ls s , w e e ncourage SSA t re s ole alof t e m is s ing SSNs t at h e e o v l h h re m ain out t s anding s o t at t e A ge ncy can pre v nt any f h h e urth e r ov rpaym e nt and e s e ns ure com pl re s iance w it lgal q uire m e nt . h e Adm inis trat e Problm s Re s ul from Unv rif d SSNs iv e t ing e ie A l ough w e not d no m one t t h e ary e f e ct in t e s am pl of be ne f f s h e iciarie s w it h unv rif d SSNs , SSA pe rs onne l is e d t at t e adm inis trat e burde ns caus e d by e ie adv h h iv unv rif d SSNs , w h ich w e re outine d in t e 19 87 H H S/ I audit re port, cont e ie l h O G inue . y, Spe cif l t e l of a v rif d SSN can pre cl : 1) t e re cov ry of ce rtain ical h ack e ie ude h e ov rpaym e nt ; e s 2)annual arnings e nf e orce m e nt 3)St e de at dat m at ing; ; at h a ch 4)dupl e paym e nt de t ct icat e ion; and 5)t axat ion of be ne f re porting. For e xam pl, it e H H S/ I re porte d t at w it out a v id SSN, SSA is unabl t accurat l re port O G h h al e o e y indiv idual ne f inf be it orm at ion t t e I o h RS. A s a re s ul I m us t us e ot e r ls s ­ t RS , h e e f icie nt ch anne l t as s e s s and col ct t s f be ne f s paid t indiv f e axe or it o idual w it s o l s h inv id account num be rs . Th e re f , re v nue s attribut e t t s im pos e d on al ore e abl o axe be ne f s m ay not be re al d. it ize O f t e 75 unv rif d BO SSN alrts incl d in our s am pl, 73 re s ul d from a h e ie e ude e t e dis cre pancy be t e e n t e nam e , dat of birth , and/ SSN e nt re d during t e w h e or e h 10 cl s appl ion proce s s and t at re corde d on SSA ’ M ES. D is cre pancie s can aim icat h s be caus e d by nam e ch ange s not pre v ious l re porte d t SSA or v y o ariat ions in t e h s pe l and/ arrange m e nt of nam e s . Addit l ing or ional dat s of birth v d f l y, e arie or ce rtain cl ant w h o f t appl d f an SSN (ge ne ral be t e e n 19 25 and aim s irs ie or l y, w
M ES is t e s y s t m SSA e m pl t e nt r e num e rat dat (e .g., nam e , dat of birth , m ot e r’ h e oys o e ion a e h s s c.)prov d by SSN appl ide nam e , f h e r’ nam e , e t at icant and t ge ne rat Social curit cards . s o e Se y 8

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19 50) w h e n SSA did not re q uire e v nt , ide iary proof of age . As a re s ul t e t h , inf orm at ion init l re corde d on M ES m ay not h av be e n accurat . O t e r ial y e e h dis cre pancie s appe ar t be caus e d by clrical cl ant e rrors and/ ov rs igh t o e or aim or e . Th e m os t re ce nt M CS re las e (3.6.1)is s ue d on Augus t 25, 19 9 7, s t e s , in part, e at M CS int rface s w it M ES w h e n t e nam e (s )e nt re d on t e A ppl ion e h h e h icat s cre e n (A P L P )dis agre e s w it t e Num ide nt nam e . W h e n t e nam e (s )is h h h dis cre pant M CS propagat s t e M ES s cre e ns at t e e nd of t e appl ion , e h h h icat pat . Th is ge ne rat s 2 ne w D e v l e nt W ork s h e e t (D W 01)is s ue s , h e e opm CL M E or NH NA M E. Th e s e is s ue s m us t s h ow a re ce ipt dat (or NA e XXXXXX)be f ore t e cl can be adj h aim udicat d. [Em ph as is adde d.] e I s um m ary, t is pol s t e s t at if cl ant inf n h icy at h aim orm at ion e nt re d in M CS doe s not e re concil w it inf e h orm at cont ion aine d in M ES, t o D e v l e nt W ork s h e e t is s ue s w e opm ut l e icy s (it m s ne e ding re s ol ion)w ilbe propagat d. Th e pol alo s t e s t at M CS e at h cont ains a re ce ipt dat f l in w h ich SSA pe rs onne l h oul e nt r th e dat e ie d s d e e e v nce w as pre s e nt d by t e cl ant t re s ole t e dis cre pancy (D e v l e nt ide e h aim o v h e opm W ork s h e e t is s ue ) H ow e v r, if SSA pe rs onne l ant t com plt proce s s ing of a . e w o e e cl w h e n e v nce h as not be e n pre s e nt d t re s ole t e dis cre pancy, t e y m ay aim ide e o v h h e nt r s ix X’ in t e re ce ipt dat f l rat e r th an an act dat . e s h e ie d h ual e W e be l v t at t e incl ion of s ix X’ (XXXXXX)in t e re ce ipt dat f l of t e ie e h h us s h e ie d h D e v l e nt W ork s h e e t w it out m anage m e nt concurre nce circum v nt t e int nt e opm h e s h e of t e control A l ough dis cre pancie s and e rrors can be e xpe ct d in any proce s s h . t h e of t is m agnit , w e be l v t at SSA can e ns ure be t e r com pl h ude ie e h t iance w it h P.L 100-647, if t is control . h coul not be bypas s e d by pe rs onne l h e r th an FO d ot m anage m e nt Furth e r, if F pe rs onne l e re re q uire d t re s ole dis cre pancie s . O w o v w h il com plt e e ing t e init cl s appl ion, t e ne e d f BO SSN alrts w oul be h ial aim icat h or e d re duce d s ignif icanty. l

BO SSN A L ERTS NO T RESO L ED I A TI EL M A NNER V N M Y
A l ough re s pons ibl FO s are not ie d of m is s ing or unv rif d SSNs on a t h e if e ie h iciarie s incl d in our s am pls h ad be e n paid ude bim ont l bas is , t e 129 be ne f h y e al os t $ m 2.2 m il ov r an av rage 3½ ye ars (ranging from 1 m ont t ov r l ion e e h o e 7 ye ars ) As such , FO s re ce iv d an av rage of 21 alrts (ov r 42 m ont s ) f th e . e e e e h or it m s re v w e d. Se v ral m anage rs w it w h om w e s pok e e xpl d t at e ie e FO h aine h re s oling BO SSN alrts is a l priorit am ong t e m any ot e r dut s as s igne d t v e ow y h h ie o t e ir of ice s . As such , FO pe rs onne l not al ay s inv s t h f do w e igat BO SSN alrts in a e e t e l m anne r. O ne FO m anage r de f d t e re s ol ion of BO SSN alrts as s im pl im y ine h ut e y a “ concil ion of re cords ”and as s e rte d t at FO pe rs onne l h oul m ore re iat h s d appropriat l s pe nd t e ir tim e w ork ing t ge t be ne f s t SSA re cipie nt . e y h o it o s

9

H ow e v r, as discussed pre v e ious l obt y, aining v rif e SSNs f auxil and e iabl or iary s ur iv be ne f v or iciarie s can h e l t e ns ure paym e nt accuracy and pre v nt ot e r p o e h adm inis trat e and re porting de f ncie s . For e xam pl, if re s pons ibl FO s h ad iv icie e e re s ole d t e BO SSN alrts f t e t re e be ne f v h e or h h iciarie s in our l it d s am pl w h o im e e im at im y e xce e de d annual arnings l it ions in a m ore t e l m anne r, SSA coul h av e d e e ns ure d t at t e s e and alot e r be ne f h h l h iciarie s w it unre s ole d SSNs w e re h v s ubj ct d t appropriat e arnings t s t in s ubs e q ue nt ye ars , t e re by pre cl e e o e e s h uding f urth e r ov rpaym e nt . e s O f t e 129 BO SSN alrts e xam ine d, w e de t rm ine d t e corre ct SSN or ide nt ie d h e e h if t e dis cre pancy pre cl h uding v rif ion f albut 6 (5 pe rce nt e icat or l )of t e be ne f h iciarie s , as s h ow n in t e f l ing t e . Th e s e s ix indiv h ol idual w e re paid a t al ow abl s ot of $ 8,445 ov r an av rage of 4 ye ars . 9 e e M is s ing and Unv rif d BO SSN A lrts Re v w e d e ie e ie
Num be r of BO SSN A lrts e Re v w e d ie 54 75 129 A v rage e Num be r of A lrts I s ue d e s Pe r SSN 21 21 21 SSNs Not I nt ie d by de if Audit Te am 4 2 6

Cat gory e M is s ing Unv rif d e ie Tot al
a

Tot Be ne f s al it Paida $ 1,061,713 1,137,838 $ 2,19 9 ,551

Tot be ne f s paid re pre s e nt t e am ount paid t t e 129 cl ant be t e e n t e ir al it h o h aim s w h 30,19 9 7. re s pe ct e init dat s of e nt lm e nt and A pril iv ial e ite Source : O I anals is of M BR and M ES dat f th e 129 BO SSN alrts s am pld. G y a or e e

To de t rm ine t e corre ct SSNs , w e re s e arch e d pe rtine nt SSA s y s t m s , incl e h e uding t e Num ide nt m as t r fil, Al a-I x Q ue rie s , and in s om e ins t h e e ph nde ance s , D e v l e nt W ork s h e e t . W e re cognize t at t com pl w it t e int nt of e opm s h o y h h e P.L 100-647, SSA pe rs onne l ay be re q uire d t pe rform addit . m o ional t ps t s e o prope rl updat A ge ncy re cords . For e xam pl, FO pe rs onne l ay ne e d t cont y e e m o act be ne f iciarie s t obt o ain SS-5 appl ions and s upporting e v nce t is s ue SSNs t icat ide o o t e s ix indiv h idual f w h om w e coul not l e an SSN. Addit s or d ocat ional SSA l y, pe rs onne l ay h av t cont m e o act be ne f iciarie s s o t at t e y can de t rm ine t e re as on h h e h f and pos s ibl re s ol ion of unv rif d SSNs (e .g., be ne f or e ut e ie iciary prov d w rong ide num be r, nam e , or dat of birth ) Furth e r, SSA pe rs onne l us t re v e t e e . m is h inf orm at cont ion aine d in e it e r th e M BR or Num ide nt m as t r fil. h e e A l ough re s ol ion of BO SSN alrts m ay be a l priorit in FO s , w e do not t h ut e ow y be l v it s h oul t e an av rage of 3 ye ars , or a m axim um of 7 ye ars , t ie e d ak e o com plt . W e bas e t is as s e rtion on t e re s ul of our anals is . e e h h t s y

10

A gain, w e be l v t at t e ne e d f BO SSN alrts coul be re duce d s ignif ie e h h or e d icanty if l SSA im plm e nt d control t at pre cl d adj e e s h ude udicat ion of cl s and paym e nt of aim e e iabl be ne f s unls s v rif e SSNs are obt it aine d from cl ant . W e are e ncourage d aim s by SSA’ im plm e nt ion of M CS re las e 3.6.1 and M ES re las e 3. H ow e v r, w e s e at e e e ie e h v h be l v t at m ore s h oul be done t 1)re s ole t e BO SSN alrts curre nty d o: e l out t s anding, 2)pre v nt f ure ov rpaym e nt , and 3)e ns ure com pl e ut e s iance w it lgal h e re q uire m e nt . A l ough SSA h as d e cl d t im plm e nt control nh ance m e nt as s t h ine o e e s a re s ul of pre v t ious O I re ports , w e be l v t at t e problm s outine d in t is G ie e h h e l h re port prov conv ide incing argum e nt f th e A ge ncy t re cons ide r it pos it s or o s ion.11 For il trat e , but not s t is t l us iv at ical purpos e s , e xtrapol ing t e re s ul from our at h t s e o h s am pl t t e 11,225 m is s ing alrts y ie l e s t at d ov rpaym e nt and incorre ct e ds im e e s paym e nt t be ne f s o iciarie s of $ m il 4 l y, ion. Addit ional w e w e re unabl t de t rm ine l e o e corre ct SSNs f 6 of t e 129 BO SSN alrts in our s am pl. Extrapol ing from t e or h e e at h s am pl t t e univ rs e of 29 ,705 alrts , w e e s t at t at $ m il w as e o h e e im e h 22 l ion y o iciarie s w h os e SSNs coul not be de t rm ine d. im prope rl paid t be ne f d e

Th e s e re ports incl 1)an H H S/ I re port e nt ld Re v w of Ch il D e pe nde nt ’ at s of Birth ude O G ite ie d s D e iciarie s (A -01-9 2-02001) is s ue d in M arch 19 9 3; , on t e M as t r Be ne f h e iciary Re cords of Tite I l IBe ne f ie nt Control in t e Social curit and 2)an SSA / I re port e nt ld Re v w of I e rnal O G ite s h Se y s aim e , Adm inis trat ion’ M ode rnize d Cl s Syst m (A -04-9 5-06019 ) is s ue d M ay 16, 19 9 7. 11

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CO NCL O N AND RECO M M END A TI NS
USI O
Bas e d on t e re s ul of our re v w , it is our opinion t at during our audit h t s ie h , pe riod, SSA ’ FO appl ion de v l e nt proce s s did not h av s uf icie nt s icat e opm e f control in pl t pre cl t e paym e nt of be ne f s t auxil s ur iv s ace o ude h it o iary/ v or cl ant w h o appl d f be ne f s w it an unk now n or unv rif d SSN. A s aim s ie or it h e ie s uch , w e re com m e nd t e f l ing corre ct e act h ol ow iv ions t e ns ure SSA ’ f ure o s ut com pl iance w it lgal q uire m e nt : h e re s 1. Tak e appropriat act e ion t re s ole alout t o v l s anding m is s ing and unv rif d SSNs e ie al e h in a t e l m anne r and e v uat t e re s ul t de t rm ine w h e t e r th e re are any im y t o s e h indicat ions of fraud t at m ay w arrant re f rral o O I s O f ice of I e s t h e t G’ f nv igat ions . 2. Re cov r ov rpaym e nt t al $ e e s ot ing 4,444 m ade t be ne f o iciarie s w h o h ad e arnings in e xce s s of annualim it ions . l at 3. Se e k re s t ut it ion of $ 15,165 in be ne f s w rongl paid af e r a cl ant s d e at . it y t aim ’ h 4. Re q uire m anage m e nt approv v e ntry of a s e cond pe rs onal nt icat al ia ide if ion num be r in M CS t ov rride s y s t m e dit (e .g., D e v l e nt W ork s h e e t is s ue s ) o e e s e opm de s igne d t pre cl t e aw ard of be ne f s t cl ant w it an unv rif d o ude h it o aim s h e ie SSN. 5. I s ue a m e m orandum t alSSA pe rs onne l s pons ibl f proce s s ing auxil s o l re e or iary and s ur iv be ne f v or iciarie s t at w ilre e m ph as ize t e im portance of f l ing h l h ol ow e s t is h e d proce dure s s o t at a prope r de t rm inat abl h e ion of e l igibily can be it m ade .

AGENCY CO M M ENTS
I it w rit e n re s pons e t our draft re port, SSA agre e d w it f n s t o h our of t e f e h iv re com m e ndat ions . Spe cif l SSA s t e d t at it is al ady purs uing appropriat ical y, at h re e re m e die s f th e cas e s in w h ich ov rpaym e nt and incorre ct paym e nt w e re or e s s ide nt ie d. Furth e r, SSA pl t is s ue a m e m orandum t at w il 1)ins truct if ans o h l : pe rs onne l o re duce t e num be r of out t t h s anding alrts ; e 2)re e m ph as ize t e h im portance of f l ing e s t is h e d proce dure s ; ol ow abl and 3)e v uat s im il t al e ar ype cas e s f indicat or ions of fraud and m ak e appropriat re f rral t t e O I e e s o h G. SSA disagre e d w it our re com m e ndat h ion t at w oul re q uire SSA m anage m e nt h d approv t ov rride s y s t m e dit d e s igne d t pre cl t e aw ard of be ne f s t al o e e s o ude h it o

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cl ant w it an unv rif d SSN. I it re s pons e , SSA s t e d t at t e unv rif d aim s h e ie n s at h h e ie SSNs re s ul from m inor dis cre pancie s be t e e n inf t w orm at ion e nt re d int M CS and e o inf orm at ion s t d on t e Num ide nt Furth e r, SSA re s t e d t at t e O I audit did ore h . at h h G not re port a m one t ary e f e ct as s ociat d w it t e s am pl of be ne f f e h h e iciarie s w it h ie e h unv rif d SSNs . Th e re f , SSA did not be l v t at re q uiring a m anage r’ re v w e ie ore s ie d -e f iv ional SSA as s e rte d t at t is l t ov rride t e e dit w oul be cos t f e ct e . Addit o e h y, h h control oul im pe de t e proce s s ing of t e cl . SSA did agre e t at t e s e w d h h aim h h dis cre pancie s s h oul be re s ole d in a t e l m anne r and w ilis s ue a m e m orandum d v im y l t appropriat s t f (Se e A ppe ndix A f th e f l e xt of t e A ge ncy’ com m e nt .) o e af . or ult h s s

O I RESPO NSE G
O ur re v w dis cl e d t at al ough SSA h as im plm e nt d proce dure s de s igne d t ie os h t h e e o com pl w it t e prov ions of P . 100-647, w e be l v t at f y h h is .L ie e h urth e r e f orts coul f d be t e n t s tre ngt e n control w it in SSA ’ cl s appl ion proce s s t e ns ure ak o h s h s aim icat o com pl iance w it lgal h e and A ge ncy re q uire m e nt . W h il
crit s e ical nt ying ide if inf orm at ion is com pare d t SSA ’ m as t r fils f alcl ant , an e dit doe s not
o s e e or l aim s pre v nt paym e nt w h e n dis cre pancie s e xis t SSA ’ pol s t e s t at if cl ant e . s icy at h aim inf orm at ion e nt re d in M CS doe s not re concil w it inf e e h orm at cont ion aine d in M ES, t o D e v l e nt W ork s h e e t is s ue s (it m s ne e ding re s ol ion)w ilbe propagat d. w e opm e ut l e Th e pol alo s t e s t at M CS cont icy s at h ains a re ce ipt dat f l in w h ich SSA e ie d pe rs onne l h oul e nt r th e dat e v nce w as pre s e nt d by t e cl ant t re s ole s d e e ide e h aim o v t e dis cre pancy (D e v l e nt W ork s h e e t is s ue ) H ow e v r, if SSA pe rs onne l ant h e opm . e w t com plt proce s s ing of a cl and e v nce h as not be e n pre s e nt d t re s ole o e e aim ide e o v t e dis cre pancy, t e y m ay e nt r s ix X’ in t e re ce ipt dat f l rat e r th an an h h e s h e ie d h act dat . ual e W e be l v t at t e incl ion of s ix X’ (XXXXXX)in t e re ce ipt dat f l of t e ie e h h us s h e ie d h D e v l e nt W ork s h e e t w it out m anage m e nt concurre nce circum v nt t e int nt e opm h e s h e of t e control Cons e q ue nty, O I af irm s t is re com m e ndat h . l G f h ion and re q ue s t t at s h SSA re cons ide r it pos it s ion on re q uiring m anage m e nt approv t ov rride s y s t m al o e e e dit d e s igne d t pre cl t e aw ard of be ne f s t cl ant w it an unv rif d s o ude h it o aim s h e ie v SSN. Furth e r, if F pe rs onne l e re re q uire d t re s ole dis cre pancie s w h il O w o e com plt e ing t e init cl s appl ion, t e ne e d f BO SSN alrts w oul be h ial aim icat h or e d re duce d s ignif icanty. l

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A PPEND I CES

A PPEND I A
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AGENCY CO M M ENTS

A PPEND I B
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M A JO R REPO RT CO NTRI BUTO RS

O f ice of t e I pe ct Ge ne ral f h ns or Gary K ram e r, D ire ct Program Audit (Eas t or, s ) Be t y A lxande r, D e put D ire ct Enum e rat t e y or, ion Sh abl Be ne f l Audit e ie d, or K im Byrd, Se nior Audit or

For addit ional copie s of t is re port, plas e cont h e act t e O f ice of t e I pe ct h f h ns or Ge ne ral P l A f airs Spe cial t at (410)9 66-9 135. Re f r to Com m on ’ ub ic f s is e I nt icat de if ion Num be r A -04-9 6-42000.

A PPEND I C
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SSA O RGAN I A TI NA LCH ART
Z O