WASHINGTON—The Social Security Administration (SSA) is being urged to not add to credit unions' compliance burdens as it works to implement a provision contained in the Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155) that is aimed at reducing synthetic identity fraud.
The request was made to the agency by NAFCU in a letter signed by President and CEO Dan Berger.
Synthetic identity fraud is a technique used by some identity thieves in which they apply for credit using some accurate information of an existing person mixed with false information – creating a "synthetic identity."
CUToday.info has expanded coverage of the challenges around synthetic identity here.
The particular provision in S. 2155 over which CUs are concerned directs the SSA to allow certain financial institutions to receive customers' consent by electronic signature – as opposed to the currently required physical written signature – to verify their name, birth date and Social Security Number. The provision also mandates that the SSA modify databases and systems to allow for the financial institutions to electronically request and receive verification of data, NAFCU explained.
Urged to Work With NCUA
In his letter to SSA Acting Commissioner Nancy Berryhill, Berger strongly encouraged the SSA to adopt a process of self-certification of compliance in order for a "permitted entity" to begin using this database. He further urged the SSA to work with the NCUA to ensure that implementation of this synthetic identity fraud provision does not create additional regulatory burdens for credit unions.
He reiterated that NAFCU supports the intent of this provision, but is "strongly opposed to any duplicative compliance requirements for its credit union members."