Important to: employers, property managers, non-profit organizations and financial institutions. 

As of June 25th, 2011…

Newly issued Social Security numbers, (assigned primarily to newborns and new U.S. Citizens), received an extra layer of protection from identity theft. That’s good.


The Social Security Administration gained a more expansive pool of Social Security numbers to assign to individuals.  Also good.

Employers, property managers, and  non-profits inadvertently received a new headache as a once straightforward method of verifying identity through Social Security numbers just became more difficult and more expensive. Not so good.

What changed?
Social Security number randomization went into effect on June 25th, 2011.  This means that any Social Security number issued after June 25th, 2011 will be issued by lottery from a “pool” of all available remaining Social Security numbers, excluding a few blocks of numbers.  Prior to June 25th, 2011, all the way back to 1936, Social Security numbers were issued based on a formula that included a geographic indicator or “area number” (the first three digits) and a “group number” (the fourth and fifth digits).  The last four digits were known as the “serial number”. 
Randomization was deemed necessary for two reasons.
1)         Population growth:  In several areas of the United States, population growth has resulted in a shortage of available numbers based on the original formula.  The new random pool will evenly distribute all available numbers to the areas that need them.  Think of it as switching to a family plan on your mobile phones which allows unused minutes from one person to be used by another person that went over their limit.
2)         Identity theft:  With the explosive growth of the Internet and information access that goes with it, identity theft has run rampant in the past decade.  Using the Social Security Administration’s own “data issuance tables” along with death indexes, birth announcements and other public data sources, identity thieves can literally construct Social Security numbers that will pass basic SSN Verifications, which simply report if a number has been issued by the Social Security Administration, along with the state and year of issuance. Randomization removes these tools from identity thieves for newly issued SSN’s.
 
How does this effect employers, leasing companies and non-profit organizations?
Virtually every employer, volunteer organization or landlord that utilizes background checks to screen their applicants has a Social Security Verification (often known as a “SSN Trace” or “Address History Verification”) built in to their background screening package.  It is a valuable tool used by background screening companies that validates an applicant’s Social Security number through a multi-step process.  This process involves…
  1. Determining the State of Issuance via the area number.
  2. Determining the approximate time of issuance via the group number.
  3. Revealing a history of name, date of birth and address history associations via several proprietary databases.
With randomization now in effect, step one and two are undeterminable on NEW Social Security numbers as the “area” and “group”
numbers are no longer coded in to the SSN.  Step three will still be applicable in determining the history of an active Social Security number once history of credit exists for the individual.  (Note: Credit history is a major source of data for Social Security number verifications conducted by screening companies)
 
Of course, the vast majority of new randomized Social Security numbers will be issued to newborns and children, thus postponing the effect these numbers will have on employers/ leasors/ non-profits until today’s children enter the workforce years down the road.  However, employers that frequently hire immigrants that have newly issued Social Security numbers will immediately notice that they’re suddenly unable to verify identity in the pre-employment background check stage of hiring.  While tools such as eVerify and SSNVS (Social Security Number Verification System) are viable post employment solutions, it is ILLEGAL to use either of these options in the pre-employment stage.  Unfortunately, the result of proper usage of these alternatives (post employment) is an abundance of red-tape and time between the time of hiring and proper dismissal when a Social Security number appears to be invalid.   
 
The Solution (Consent Based Social Security Number Verification System)
The only current solution to verifying that an individual’s name and date of birth match the Social Security number provided during an applicant background check, is to ask your applicant screening provider to utilize the Consent Based Social Security Verification System.  Known as “CBSV”, this system represents the first time the Social Security Administration has granted access directly to pre-employment background screening providers. This relatively new (new in the sense that it is finally cost effective and easily accessible) system is also the only method to verify that a new Social Security number belongs to an applicant before you hire them.  Once again, other methods such as SSNVS and eVerify are only legally accessible after the applicant has been hired.


Is it Free? 
Like most things in life, no.  The Social Security Administration invested a great deal of tax payer money into creating this new service, and they have established a structured fee schedule to access the information.  Exact costs depend on the service you use to connect with the system.  Expect to pay fees between 7 and 15 dollars per search.


While the CBSV will slightly raise the cost of background screening across the board, the ability to determine a false identity before an applicant is brought on-board FAR outweighs the alternative.  Discovering an employee’s Social Security number is false through eVerify or SSNVS once they’re employed can results in a labyrinth of procedures and red-tape, which equals time and money. Spending a few extra few dollars on the front end will save you a bundle on the bottom line.

For questions or pricing in regards to CBSV, SSNVS, eVerify or other acronyms that effect your applicant screening processes, please email contact@safescreener.com or call 888.578.8600 x113.  We’re here to help!
Please note: Recommendations in regards to F.C.R.A Compliance and industry best practices issued by Background Screening Consultants LLC (SafeScreener.com) should not be regarded as or substituted for legal advice.