With the explosion of synthetic identity fraud across the United States, the need for an automated social security number verification program has been sorely needed. The Social Security Administration is launching a new plan for the creation of just such a pilot program which is planned to launch in June 2020.
On June 7, 2019, the SSA announced the launch of the program and also put out a call for participants to apply to be included with the pilot program or with later phases in the planned expansion for six months after the initial launch. The creation of this soon to be launched program, is a new requirement created under the Economic Growth, Regulatory Relief, and Consumer Protection Act, which was signed into law in 2018.
Currently, the SSA requires that signed paper documents be provided at the individual level by individuals desiring to have their Social Security number validated. The new legislation requires the SSA to create and establish a database for electronic Consent Based Social Security Number Verification (eCBSV.)
The new program, is expected to be like eVerify, except for SSNs. The program, is dependent solely upon funding paid up front by participating institutions. It is expected, like eVerify, to process large batches of verification requests.
For the lenders that desire to participate in the pilot program, they may be a little disappointed to learn that they will be required to pay a $3,693 startup cost, plus tiered transaction rates based on volume from as little as $3,000 to as much as $5M!
The SSA’s pilot program is expected to fund at least 50% of the total program’s startup expenses, so pilot members will basically be funding future platform users, assuming it ever gets off the ground. Assuming the program is successful, a future with interfaces from credit bureaus and or loan origination systems could help put a chill on the proliferation of synthetic identity fraud nationwide.
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