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S. HRG. 109–987

BORDER INSECURITY, TAKE TWO: FAKE IDs

FOIL THE FIRST LINE OF DEFENSE

HEARING

BEFORE THE

COMMITTEE ON FINANCE

UNITED STATES SENATE

ONE HUNDRED NINTH CONGRESS

SECOND SESSION

AUGUST 2, 2006

(

Printed for the use of the Committee on Finance

COMMITTEE ON FINANCE

CHARLES E. GRASSLEY, Iowa, Chairman

ORRIN G. HATCH, Utah

TRENT LOTT, Mississippi

OLYMPIA J. SNOWE, Maine

JON KYL, Arizona

CRAIG THOMAS, Wyoming

RICK SANTORUM, Pennsylvania

BILL FRIST, Tennessee

GORDON SMITH, Oregon

JIM BUNNING, Kentucky

MIKE CRAPO, Idaho

MAX BAUCUS, Montana

JOHN D. ROCKEFELLER IV, West Virginia

KENT CONRAD, North Dakota

JAMES M. JEFFORDS (I), Vermont

JEFF BINGAMAN, New Mexico

JOHN F. KERRY, Massachusetts

BLANCHE L. LINCOLN, Arkansas

RON WYDEN, Oregon

CHARLES E. SCHUMER, New York

KOLAN DAVIS, Staff Director and Chief Counsel

RUSSELL SULLIVAN, Democratic Staff Director

(II)

(III)

C O N T E N T S

OPENING STATEMENTS

Page

Grassley, Hon. Charles E., a U.S. Senator from Iowa, chairman, Committee

on Finance ............................................................................................................ 1

WITNESSES

Kutz, Gregory, Director, Office of Forensic Audits and Special Investigations,

Government Accountability Office; accompanied by John Cooney, Assistant

Director, FSI, Washington, DC ........................................................................... 3

Ahern, Jayson, Assistant Commissioner for Operations, Customs and Border

Protection, Department of Homeland Security, Washington, DC .................... 4

Everitt, Michael, Unit Chief, Forensic Document Laboratory, Immigration

and Customs Enforcement, Department of Homeland Security, Washington,

DC .......................................................................................................................... 6

Kephart, Janice, principal, 9/11 Security Solutions, Alexandria, VA; formerly

counsel to the 9/11 Commission .......................................................................... 17

Shepherd, David, director of security, Venetian Resort Hotel, Las Vegas,

NV; formerly with the Federal Bureau of Investigation ................................... 19

Reeves, Bruce, CEO, AssureTec Systems, Manchester, NH ................................ 20

Carr, Scott, executive vice president, Digimarc, Beaverton, OR ......................... 22

ALPHABETICAL LISTING AND APPENDIX MATERIAL

Ahern, Jayson:

Testimony .......................................................................................................... 4

Prepared statement .......................................................................................... 31

Baucus, Hon. Max:

Prepared statement .......................................................................................... 36

Carr, Scott:

Testimony .......................................................................................................... 22

Prepared statement with attachment ............................................................. 38

Everitt, Michael:

Testimony .......................................................................................................... 6

Prepared statement .......................................................................................... 56

Grassley, Hon. Charles E.:

Opening statement ........................................................................................... 1

Kephart, Janice:

Testimony .......................................................................................................... 17

Prepared statement with attachment ............................................................. 66

Kutz, Gregory:

Testimony .......................................................................................................... 3

Prepared statement with attachments ........................................................... 85

Reeves, Bruce:

Testimony .......................................................................................................... 20

Prepared statement with attachments ........................................................... 97

Responses to questions from committee members ......................................... 109

Shepherd, David:

Testimony .......................................................................................................... 19

Prepared statement .......................................................................................... 114

COMMUNICATIONS

JDSU Flex Products Group ..................................................................................... 117

National Treasury Employees Union ..................................................................... 122

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BORDER INSECURITY, TAKE TWO: FAKE IDs

FOIL THE FIRST LINE OF DEFENSE

WEDNESDAY, AUGUST 2, 2006

U.S. SENATE, COMMITTEE ON FINANCE, Washington, DC.

The hearing was convened, pursuant to notice, at 10:15 a.m., in

room SD–215, Dirksen Senate Office Building, Hon. Charles E.

Grassley (chairman of the committee) presiding.

Present: Senator Bingaman.

OPENING STATEMENT OF HON. CHARLES E. GRASSLEY, A U.S.

SENATOR FROM IOWA, CHAIRMAN, COMMITTEE ON FINANCE

The CHAIRMAN. Good morning, everybody.

It is a sad occasion for the Baucus family today, because Senator

Baucus’s nephew, Colonel Philip E. Baucus, paid the ultimate price

for the defense of freedom in America in the war on terror Saturday, because he was a brave Marine, and lost his life there in Iraq.

I have had a chance to talk to Senator Baucus about it. Even

though it is a nephew, Senator Baucus is very, very sad, and very

sad for his brother as well. So we grieve with the Baucus family,

and that is why he is not going to be here today, and we can all

understand that. But I want him to know that my prayers are with

him and his family.

Senator Baucus and I talked about this meeting previously. He

always makes opening statements. His statement, I am going to

put in the record for him.

[The prepared statement of Senator Baucus appears in the appendix.]

The CHAIRMAN. Today’s hearing is entitled ‘‘Border Insecurity,

Take Two.’’ Our purpose is to follow up on a hearing that we had

in the year 2003 to examine the security of our Nation’s borders

and find out whether the situation has improved.

At that hearing, the Government Accountability Office testified

about how easy it was for investigators of their agency to create

phony driver’s licenses, and a lot of other documents, using a common personal computer. The Government Accountability Office

then used those fake documents to enter the United States.

Now, it has been nearly 5 years since 9/11, and more than 3

years since we held that first hearing. Things should have gotten

better by now, but today the Government Accountability Office testifies that its investigators did it again. They used the same phony

documents and the same fake IDs to cross the U.S. border 18 more

times, and they were not ever caught once.

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Those Government Accountability Office investigators could have

been known criminals, wanted fugitives, or even terrorists, but

they were just somehow waved into our country. Frankly, it is hard

to believe that there has been so little progress in plugging this

gaping hole that we have in what ought to be a security fence.

Congress, I think, has tried to do its part. Since that hearing, we

passed the Real ID Act to set Federal standards for driver’s licenses. We passed the Western Hemisphere Travel Initiative to require that everyone crossing the border carry either a passport or

some other document that establishes the identify of that person,

and the citizenship of that person.

Less than 2 years after setting that deadline, now some people

are even talking about just putting it off. So, how ready are we?

Today, the purpose of this meeting is to get a progress report. But,

more importantly, what is being done in the meantime? What could

be done to improve our security?

Inspectors who work for the U.S. Customs and Border Protection

are this Nation’s first line of defense against criminals and terrorists coming to America. They should have the best tools and they

should have the best technology available to help them catch people using suspect documents.

However, as we will learn today, some stores give their clerks

better tools to catch under-aged drinkers. That sounds, of course,

incredible, but it is true. We will hear testimony about how private

industry is using technology to scan documents of all kinds and determine, in just a matter of seconds, whether they are looking at

a real document or a fake document.

We will also hear how similar technology has been implemented

in State Departments of Motor Vehicles to help them comply with

the Real ID Act, and we will hear about how foreign countries—

to name two, Chile and Singapore—have given inspectors these

tools to help secure the borders of those sovereign nations.

If document verification technology works for the private sector,

for State governments, and for foreign countries, there is no excuse

for not using it to protect America’s borders as well.

Yet, the Homeland Security Agency appears to have no plans to

implement any new technologies beyond sitting back and waiting

for the Real ID Act and the other bills that we passed to take effect.

About 741 million people have crossed our border since the Government Accountability Office’s testimony at our last hearing 3

years ago, and about 300 million more people will be crossing before the other documentation is put in place, that documentation

which will be implemented in 2008, assuming that it is implemented on time.

Until someone does something to address this problem, criminals

and terrorists will know that our front door is wide open.

Now, a comment about our second panel, because it might be interpreted that this committee or the Senate is endorsing a certain

product. I want to make it very clear that those witnesses on the

second panel who are going to talk about private industry and the

document verification technology that they sell, that they were invited to tell us what kinds of solutions are currently available. The

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fact that they are testifying should in no way be taken as an endorsement by the committee of any particular product.

We will now go to our witnesses. We have Mr. Gregory Kutz, Director, Office of Forensic Audits and Special Investigations at the

Government Accountability Office, accompanied by John Cooney,

Assistant Director; Mr. Jayson Ahern, Assistant Commissioner of

Operations, Customs and Border Protection, Department of Homeland Security; and Mr. Michael Everitt, Unit Chief, Forensic Document Laboratory, Immigration and Customs Enforcement, Department of Homeland Security.

Your written testimonies will be included in the record, so we

would ask you to take the time that we have allotted to summarize,

if that is your wish.

So we will go in the order in which you were introduced. Mr.

Kutz, first.

STATEMENT OF GREGORY KUTZ, DIRECTOR, OFFICE OF FORENSIC AUDITS AND SPECIAL INVESTIGATIONS, GOVERNMENT ACCOUNTABILITY OFFICE; ACCOMPANIED BY JOHN

COONEY, ASSISTANT DIRECTOR, FSI, WASHINGTON, DC

Mr. KUTZ. Chairman Grassley and Senator Bingaman, thank you

for the opportunity to discuss our undercover operation to test border security.

Our operation was done in response to your concern that counterfeit documents could be used to enter the United States from Canada and Mexico. My testimony has two parts. First, our 2006 border crossings, and second, our crossings in 2002 and 2003.

First, we tested nine land border crossings, five at the U.S.-

Canadian border and four at the U.S.-Mexican border. The purpose

of our operation was to test whether Customs and Border Protection inspectors could identify counterfeit documents.

We crossed the U.S.-Canadian border from New York, Michigan,

Idaho, and Washington. We crossed the U.S.-Mexican border from

California, Arizona, and Texas. Six of our crossings were done

using rental cars, three were by foot.

As shown on the poster board, we conducted our operation using

counterfeit driver’s licenses and birth certificates. As you can see,

our driver’s licenses were from West Virginia and Virginia, and our

birth certificates were from New York and West Virginia.

To create these bogus documents, we used software and information that were available to the public. We also used the same bogus

name and identifiers for the West Virginia driver’s license that we

used for our 2002 operation.

The next poster board shows a genuine Virginia driver’s license

and our counterfeit license. Specifically, notice the hologram on the

genuine driver’s license which is missing from the counterfeit driver’s license. Part of our test was to use a driver’s license that could

be identified as a counterfeit. We did not attempt to develop a more

sophisticated driver’s license.

During 2006, two investigators successfully entered the United

States, each crossing from nine locations. CBP inspectors never

questioned the validity of our counterfeit documents. Further, in

both Texas and Arizona, inspectors did not ask our investigators

for any identification.

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Moving on to my second point. We found similar vulnerabilities

for crossings we did in 2002 and 2003. Using counterfeit documents, we entered the United States from both Canada and Mexico. Our land crossings were done in California, Texas, New York,

and in Washington.

In two instances, we successfully entered the United States by

ferry. We were caught once entering New York in 2003. Specifically, our investigator was detained by CBP inspectors until he

identified himself as a GAO employee.

This individual used the same documents later in 2003 to enter

the United States from California and Texas. Although this individual had been entered into what is referred to as the TECS system after being caught entering New York, he was able to enter

again later in 2003 because no name check was done.

We briefed CBP officials about the results of our test in June of

2006. They acknowledge that their inspectors cannot identify all

forms of counterfeit documents at land border crossings.

Note that the Western Hemisphere Travel Initiative calls for the

Secretary of DHS to improve border security through use of passports and other documents by January of 2008. Subsequent legislation could delay that until June of 2009.

In conclusion, CBP inspectors clearly do not have the tools available to identify counterfeit documents. From a security standpoint,

the current system will always be vulnerable to individuals entering the United States using counterfeit documents. The challenge

for our country will be to develop a system that provides us with

a secure border, but does not impede commerce.

Mr. Chairman, this ends my statement. Special Agent Cooney

and I look forward to your questions.

The CHAIRMAN. Thank you. I am sorry if I mispronounced your

name.

Mr. KUTZ. That is all right.

[The prepared statement of Mr. Kutz appears in the appendix.]

The CHAIRMAN. Mr. Ahern?

STATEMENT OF JAYSON AHERN, ASSISTANT COMMISSIONER

FOR OPERATIONS, CUSTOMS AND BORDER PROTECTION,

DEPARTMENT OF HOMELAND SECURITY, WASHINGTON, DC

Mr. AHERN. Good morning. Thank you, Chairman Grassley and

Senator Bingaman, for the opportunity to appear before the committee today to discuss the recent GAO investigation into the U.S.

Customs and Border Protection’s ability to detect counterfeit driver’s licenses and birth certificates.

We welcome the lessons we learned from GAO about how to better secure our country. In this case, GAO had verified a vulnerability that CBP is well aware of, and that fraudulent documents

provide a gap in our security, specifically, our CBP officers have

difficulty in detecting counterfeit birth certificates and driver’s licenses.

But what we are talking about here is larger than just two

American GAO investigators using fraudulent driver’s licenses to

get back into the United States. What we are talking about is the

need for standardized documentation that will be used at our borders, and, in my view, the sooner, the better, sir. The CBP very

5

strongly supports standardized documents that will make us more

effective at our job and make the borders of this country more secure.

Let me put, also, this reported vulnerability into better perspective. Each day, CBP officers process more than 870,000 people arriving at our Nation’s 130 land borders. Unlike international air

and sea travel, where we receive advanced information through

passenger manifest information and most of the individuals travel

with passports, we do not have that luxury at the land borders

here in the United States.

So, consequently, our officers must verify the authenticity of

more than 8,000 different types of documents from various counties, cities, States, as well as some foreign countries on the spot,

within a matter of minutes, to identify the identity of the individual, and also their citizenship.

As the 9/11 Commission reported, security requirements governing travel to and from Canada, Mexico, and parts of the Caribbean should be treated as equivalent to the security requirements

for travel to and from other parts of the world.

Congress recognized this important principle when it passed the

Intelligence Reform and Terrorism Protection Act of 2004, which

included what is commonly known today as the Western Hemisphere Travel Initiative, WHTI.

For the purposes of identification, it is estimated that more than

40 percent of U.S. citizens today crossing through our land border

ports currently use passports. That means that under the current

law, for 60 percent of individuals, all they are required to do under

the current statute is just to make an oral declaration of their citizenship for entry back in the United States.

I again state that birth certificates and driver’s licenses are not

secure, they are not verifiable, and they do not adjudicate citizenship. It proves that an individual can operate a vehicle. It is not

proof of citizenship and it is not an acceptable admissibility document; the same with the birth certificate.

As we certainly saw with this GAO test, they can be easily manufactured and obtained through fraud. The standardization for

travel documents is a critical step in securing this country’s borders. Currently, there are thousands of different documents, as I

stated, that can be presented to our officers each day.

Standardization of these documents will also eliminate the timeconsuming need for verifying and reviewing the host of these distinct, sometimes illegible and unverifiable birth certificates, and

other identity documents.

The use of these standardized documents will enable automated

reading and vetting of the information, which will also be essential

to achieving the facilitation benefits of WHTI. Valuable time is

wasted, when we are looking at accuracy, to try to verify these documents when we have to do manual entries that are required currently.

In the future, automated reading and vetting of identity documents will be an important tool for us to distinguish the small percentage of individuals coming into this country who pose a potential threat against the legitimate traveling public volume.

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The people whom we deal with today also present an infrastructure problem. The capacity of our ports is challenged. As we begin

to look at additional documents, we have to also manage the wait

times at our ports of entry.

Otherwise, the economic vitality of our country could be impacted

as we take a look at doing increased checks at the land borders,

and we have to strike the appropriate balance between security

and facilitation of legitimate trade.

One of the things we have done to address that is through expanding our Trusted Traveler programs: Free and Secure Trade

(FAST), the NEXUS program, the SENTRI program. We have,

now, over 225,000 individuals enrolled in these types of trusted

programs. We need to continue to expand these types of programs,

and we are doing so this week with an expansion in Hidalgo, TX.

Just to put into perspective also our officers today, I want to

speak very positively about what they do to secure this country, because I do not want this committee or the public to think that our

officers are not on the job, doing a very good job at identifying

fraudulent documents coming into the country that are unacceptable admissibility documents.

Last year, we intercepted more than 84,000 fraudulent documents at our ports of entry. We denied admission to over 565,000

inadmissible aliens coming into this country, all the while seizing

more than 800,000 pounds of narcotics, and we arrested more than

23,000 subjects, and 17,000 criminal aliens coming into this country.

It is important, as we look to move forward, that we continue to

evaluate the test of the Government Accountability Office. I urge

that we do move forward with the implementation of WHTI without delay.

Thank you very much.

The CHAIRMAN. Thank you, Mr. Ahern.

[The prepared statement of Mr. Ahern appears in the appendix.]

The CHAIRMAN. Now, Mr. Everitt?

STATEMENT OF MICHAEL EVERITT, UNIT CHIEF, FORENSIC

DOCUMENT LABORATORY, IMMIGRATION AND CUSTOMS

ENFORCEMENT, DEPARTMENT OF HOMELAND SECURITY,

WASHINGTON, DC

Mr. EVERITT. Good morning, Chairman Grassley and Senator

Bingaman. I am pleased to be here today to discuss the technical

aspects of fraudulent documents.

The U.S. Immigration and Customs Enforcement Forensic Document Laboratory, known as the FDL, is the premier forensic document laboratory in the world and is dedicated exclusively to the detection and deterrence of fraudulent documents.

The FDL is accredited by the American Society of Crime Lab Directors’ Laboratory Accreditation Board on questioned documents

and latent prints. The FDL’s mission is to detect and deter domestic and international travel and identity document fraud by providing a wide variety of forensic and support services to all DHS

components, and other Federal, State, and local agencies, as well

as foreign government, law enforcement, and border control entities.

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There are misconceptions about what constitutes a fraudulent

document. Many people think that fraudulent documents are simply counterfeit documents. While counterfeit documents are, in

fact, fraudulent documents, the term ‘‘fraudulent documents’’ also

includes altered and fraudulently obtained documents.

Altered documents are genuine documents with erasures, substituted photos, and thin-layer laminate overlays. Fraudulently obtained documents are genuine documents that have been obtained

by fraudulent means.

Whether counterfeit, altered, or fraudulently obtained, their purpose is to allow the bearer privileges or benefits to which they are

not entitled.

Stolen blank documents also pose a serious threat. Over the

years, the FDL has seen many stolen blank passports which have

been personalized to create fraudulent documents. These documents are particularly hard to detect.

The FDL sees many types of fraudulent documents originating

from locations all over the world. We also see fraudulent documents of various quality. These include documents that are obviously fraudulent upon inspection, and range up to high-quality documents that can only be confirmed using sophisticated equipment

for forensic examination.

In addition to the services we provide to field units, the FDL also

directly supports ICE investigations targeted against the producers

and distributors of fraudulent documents. We also support the ICE

Document and Benefit Fraud Task Forces which were established

in April of this year in 11 cities across the United States. These

task forces have already achieved significant successes, and ICE is

evaluating the expansion of these task forces to additional locations.

Fraudulent travel and identity documents are a worldwide problem which will continue to challenge law enforcement officials in

the United States and abroad. As long as identification is required

to travel and obtain goods, services, or jobs, criminals will attempt

to produce fraudulent documents.

ICE has had many successes in stopping several major fraudulent document production and distribution operations, including the

Castorena Family Organization and the Mandalapa Organization.

These investigations resulted in numerous indictments and arrests, the seizure of millions of dollars in illegal proceeds, and tens

of thousands of fraudulent documents. ICE special agents across

the country continue these same type of investigations today.

In order to deter and detect fraudulent documents effectively in

the field, the FDL believes there needs to be a triad approach. This

triad approach includes: (1) strong documents using the latest materials and technologies for the production and incorporation of the

latest security features; (2) electronic systems to validate the existence of the document and the information contained within; and

(3) a biometric link that will tie the person presenting the document to the document and to the electronic validation.

In order to work properly, each of these three elements of this

triad system must be as strong as possible, including the documents. This is not only to ensure the integrity of the triad system,

8

but also to allow the documents to stand on their own in the event

that the technology systems are not available.

The development and distribution of this system will be expensive. It will require replacing current document production systems

and infrastructure and the integration of new technologies. However, we believe the investment in this system would pay healthy

benefits and dividends in increased security and faith in our identification system.

On behalf of the men and women of ICE, and specifically the

men and women of the Forensic Document Laboratory, I thank the

Finance Committee and its distinguished members for your continued support of our work.

I would be pleased to answer any questions you might have at

this time.

[The prepared statement of Mr. Everitt appears in the appendix.]

The CHAIRMAN. Yes. If it is all right with Senator Bingaman, I

think we will take 10-minute round turns. Is that all right, as long

as there are only two of us here?

Senator BINGAMAN. Sure.

The CHAIRMAN. All right.

To Mr. Kutz, your investigators have been getting through checkpoints with fake IDs for nearly 4 years. In total, according to the

chart that we have, 93 percent of the crossings were unhindered.

They do not seem to be getting much better at it during that period

of time.

Did the Government Accountability Office investigators see any

improvement since our 2003 hearing that made it harder for them

to cross the border with fake IDs?

Mr. KUTZ. No, not really. I think that the current system, as I

mentioned in my opening statement, is vulnerable to people entering the United States from Canada and Mexico, or other locations,

using counterfeit documents.

So I am not sure it is reasonable to expect the human element

of people at the border, with the current technology they have, to

be able to identify counterfeit driver’s licenses and birth certificates. There are too many variations and too many other types of

variables involved. From a security standpoint, more of a standardized process is going to be necessary to secure the border.

The CHAIRMAN. All right.

Mr. Ahern, I have three or four questions. They are all kind of

hooked together, and they are not complicated.

Just, an explanation of why your agency has not gotten any better at catching these phony IDs since our last hearing, how long

it might take, and how many hearings we would have to have to

bring this to the attention of the agency to maybe handle the problem, and just, if we were, for instance, to have such tests a year

from now, would you predict that your agency’s failure rate would

be better? Is there a certain number of years that you might predict? I am just saying 1 or 2 years.

Mr. AHERN. Well, Senator, what I would offer as an answer to

that, first off, when we take a look at documents that are admissibility documents, driver’s licenses and birth certificates are not acceptable documents for admissibility.

9

We train and have our officers focus on those documents that are

legitimate admissibility documents that are government issued,

that are adjudicated, that actually verify identity, and also their

nationality and citizenship. Those are passports, border crossing

cards, permanent resident cards, and laser visas.

As I said, we have 84,000 of those that we actually intercepted

in the last year, so that is our focus. Those are the individuals who

pose a risk to this country, who are coming in with those types of

false documents, not American-born U.S. citizens who work for the

Government Accountability Office with a driver’s license coming

into this country.

But your question is, what are we doing to move forward? We are

looking at bringing on additional equipment, and also for training

for officers on the driver’s licenses.

As you have pointed out, that is a vulnerability. Until we actually have the WHTI with standardized documents, 18 months from

now, in January of 2008, we will have that vulnerability where

people could exploit that.

I want to provide some level of confidence to you, sir, that we are

very adept at identifying those documents that truly could be used

against us for risk by people of foreign-born nationality who are

coming into this country. Those are passports, border crossing

cards, and permanent residency cards, that we do intercept with

great regularity.

The CHAIRMAN. Mr. Everitt, I am wondering about the typical

quality of fake documents that you see at your Forensic Laboratory. Approximately how many are sophisticated enough that a

CBP inspector could not tell that they are phony simply by looking

at them?

Your office conducts extensive training of other agencies such as

CBP on how to recognize fake documents. Officers at primary inspection points only have a little time to look at documents and decide whether they are phony. There are over 240 valid types of

driver’s licenses and hundreds of other kinds of identity and travel

documents.

The second question is, how can we possibly train a front-line inspector to memorize all the security features in all of these documents well enough to catch the fakes by looking at them in only

a few seconds?

Mr. EVERITT. Senator, if I may answer your second question first.

We cannot train people to recognize the individual security features

in all those different documents. It is too much information.

What we do is, we train on security features that are incorporated in documents, and to look for those security features. Many

security features run across a wide variety of documents. What we

believe is that we need to create better-quality documents across

the board.

If I can show this, I would like to put up a display of a Virginia

driver’s license. There are two examples of a Virginia driver’s license. As you can see, they are very, very close.

What you are actually looking at is, the driver’s license that is

on your left is counterfeit, the one that is on the right is authentic.

It would be hard for most people in the field to recognize that counterfeit driver’s license. It is very, very close to the original. ActuVerDate 11-MAY-2000 09:54 Nov 30, 2007 Jkt 095484 PO 00000 Frm 00013 Fmt 6633 Sfmt 6633 38554.000 SFIN1 PsN: SFIN1
10

ally, without having the authentic driver’s license up there with it,

it would be almost impossible to tell the two apart.

The first part of your question, as I answered before, we do provide the training on the security features in the documents and we

provide that not only to CBP, but to agencies throughout the government, and also around the world. It is a difficult task because

we have so many different documents.

Unfortunately, our documents tend to lag behind in technology,

to where the technology that is used to create the documents becomes commercially available and is widely available to anyone

who has the money to purchase it, and it has actually come down

in expense over the years.

What we need to be doing is, we need to be pushing forward very

diligently to bring in the new technologies to make stronger documents as those technologies come on board.

The CHAIRMAN. Mr. Kutz, how easy was it to create fake documents that were used by your agency to cross the border?

Mr. KUTZ. We do it all the time, actually. We do it, between Mr.

Cooney’s and my office. We use, again, as was mentioned by Mr.

Everitt, publicly available hardware, software, paper stock, or plastic, whatever you are talking about. So I would say, to make a

counterfeit driver’s license is not very difficult. To make a very

good one would be much more difficult.

I would add, with respect to things like passports, I believe passports would be much, much more difficult. We have not counterfeited passports before, but I believe they would be much more difficult to do. So I think, from a security standpoint, again, documents like that would be much more difficult to counterfeit.

The CHAIRMAN. Mr. Everitt, we have asked to see the tools that

the Department of Homeland Security provides officers at primary

inspection points to catch documents like fake driver’s licenses.

We got this booklet that is called ‘‘ID Checking Guide,’’ and it

would have different documents, driver’s licenses for the various

States. This is what we got. I understand that you brought to the

hearing some other tools that you have. Could you tell us what

those are?

Mr. EVERITT. Yes, sir. When we provide the training, one of the

things that we provide is called a 10× loupe. It is simply a magnification device that you look at a document with to magnify the

security features that are on there to identify the security features.

It is effective. There are security features that cannot necessarily

be seen with the naked eye, but can be seen with a magnification

device of this type.

We also provide a black light and a flashlight. The black light

allows you to see ultraviolet security features. The flashlight can

be used as a combination device. The flashlight can be used not

only to put more intense light on it, but also to use it at angles

to show features that show up with side lighting.

The CHAIRMAN. Is there any other technology available in a primary inspection booth to detect fake driver’s licenses?

Mr. EVERITT. Sir, I would have to pass that question to Mr.

Ahern.

The CHAIRMAN. All right.

Mr. Ahern?

11

Mr. AHERN. Senator, no, there is not.

The CHAIRMAN. All right.

Mr. AHERN. Just to give a broader answer on that as well. Until

we have a standardized document that has biometric security features inside, and also has machine-readable capabilities so our primary officers can run it against our border integrated systems for

watch-listing and for NCIC fugitives, we will have this same type

of a hearing periodically, sir, until we actually have the full security capabilities on the primary borders of this country.

The CHAIRMAN. All right. So until the perfect document comes

along then, there is not anything you are going to try to do between

now and then.

Mr. AHERN. That is not my response, sir. To be able to provide

the level of security that you and this country expects, we need

those standardized documents with machine-readable capabilities

that have security features imbedded in those documents.

What we are continuing to do, though, is to provide the training.

We have taken several steps since the GAO investigations to provide that book that you just showed to the panel here, as well as

training musters and awareness toward individuals.

In fact, yesterday I was in Detroit, seeing what a private sector

solution might be for us to look at verifying documents. The particular piece of technology I saw was a reader of a driver’s license

that was taped to the top of a laptop. That is not an acceptable

piece of technology for our border officers. All it did was go against

9 States’ databases to find out whether it is a legitimate document

or not.

So we need to have something that not only gets all 50 States

for all versions that are out there in those 50 States, which can be

over 170 or 180 versions, I am told, and also something that goes

against the watch list of this country and our fugitive database,

and our look-out systems that we have at air and seaports today.

The CHAIRMAN. All right.

Senator Bingaman?

Senator BINGAMAN. Thank you, Mr. Chairman. Thank you all for

being here.

Let me just try to understand, the best I can, what is involved.

When we are checking people coming in at our borders, the ideal

would be to have everybody with a passport, I guess. I mean, my

impression is, Mr. Kutz, I think you said that it is more difficult

to make false passports, or that is your impression.

Mr. KUTZ. Yes. I would agree with what Mr. Ahern said, too. The

biometric really is what is the most secure. But certainly of what

is out there now, the passport is much better than a driver’s license

or birth certificate.

Senator BINGAMAN. And the job of the inspector at the port of

entry is to say, this person is the person who properly owns this

passport, who was properly issued this passport.

Second, this person is not on one of our watch lists and we have

no objection to this person entering our country. That is the machine-readable part, I guess, or to basically calculate a check-back

with some database and make sure that, whoever it is who has this

passport, once we have determined that it is a valid passport, is

12

not somebody we want to keep out of the country. Am I understanding that right so far, Mr. Ahern?

Mr. AHERN. Thank you. That is essentially correct. If I might just

walk through those, I would appreciate that.

Senator BINGAMAN. Yes. Go ahead.

Mr. AHERN. First off, in the air environment, it is the best example we have. Your question is, would we prefer a passport for land

border solutions? Certainly that would be the gold standard.

But as we are looking forward to the implementation of WHTI

in January of 2008, we need to take a look at what is something

that is an equivalent document. Secretaries Rice and Chertoff have

looked at what might be an equivalent to a passport with some security features.

It might be a wallet-sized card referred to as a PASS card that

would have some of the same security features, and also the same

machine readability. That, we are still exploring between our two

departments.

But, clearly, what we need to have is a document that has been

adjudicated by an official of a government that we have confidence

in, something that identifies the citizenship of that individual and

that we can verify through security features in that document and

biometrically match that person, much like we do at airports today

with the U.S. VISIT program.

We have an individual who comes in, and we do finger scans on

primary to match that person against the document that they received overseas and the visa they were issued overseas, to be able

to match that person. That is a huge security feature that we have.

We need to have those types of things replicated in all environments.

Senator BINGAMAN. Let me try to understand. There seemed to

me to be various initiatives moving forward here to meet these

needs, and I am not sure how they integrate or relate to each

other. There is this WHTI card that you have referred to, I believe.

Mr. AHERN. WHTI is not a card. WHTI is an element of the Intelligence Reform and Terrorism Protection Act which calls for

standardized documents for January of 2007 for air and sea, and

January 1, 2008 for the land environment.

Senator BINGAMAN. All right.

There is also this PASS card that you just referred to. I guess,

the Secretary of State would be issuing PASS cards, at the urging

of Homeland Security. Is that right?

Mr. AHERN. We are working collaboratively with the Department

of State and with the Department of Homeland Security, and with

the Government of Canada, also, as far as what might be an acceptable standard of documents.

We are looking at, certainly, the passport being the gold standard solution, but realizing that the adjudication and issuance of

passports for people that do a lot of multiple cross-border travel

may not be realistically feasible.

But we would not settle for anything less than something that

is as secure and has biometrics, as well as something that has machine readable capability.

Senator BINGAMAN. So what you are driving toward, getting to,

is where everybody coming through a port of entry would have eiVerDate 11-MAY-2000 09:54 Nov 30, 2007 Jkt 095484 PO 00000 Frm 00016 Fmt 6633 Sfmt 6633 38554.000 SFIN1 PsN: SFIN1
13

ther a valid passport or a PASS card. Is that an accurate statement

or not?

Mr. AHERN. What I would say, sir, is that is very accurate. I

began my career as a front-line officer 30 years ago on the border

with the U.S. and Mexico in San Ysidro, CA.

As I look 30 years later, we need to provide a level of security

to identify individuals coming into this country, to run it against

the watch list, determine their citizenship, and we need to make

sure that we have a standardized document that has the biometric

features, whether it is a passport or a PASS card, that is machine

readable.

Senator BINGAMAN. But it has to be one of those two?

Mr. AHERN. Something that meets that standard, certainly. We

are taking a look at if there are other types of documents that meet

those standards, but that is what we are looking at as we move forward.

Senator BINGAMAN. All right.

Now, we also legislated here in the Congress a requirement

called the Real ID requirement to be implemented by May 11 of

2008. That calls for standards being imposed upon the issuance of

driver’s licenses by the various States, as I understand it. How

does that requirement by the Federal Government relate to these

other various things that you are talking about here?

I mean, if we are not going to allow people to use these driver’s

licenses to get into the country at any rate, then it is not relevant

to that screening process, I guess. It would be relevant to other

screening process. Is that accurate?

Mr. AHERN. Well, I am more familiar with the WHTI requirement for admissibility. A driver’s license does not adjudicate citizenship. It does not indicate their citizenship. The Real ID would

provide a secure document that gives the individual permission to

drive.

Oftentimes, a driver’s license is one form of identification that

can be used for the application of a passport, so any security you

could add into that certainly would be important. But as I take a

look at, again, border requirements, what we need are standardized documents that are provided for under WHTI.

And another point as well. There are other programs that we

want to take a look at tying in. Currently, as you are aware, being

from New Mexico, we have our cross-border travel program, the

SENTRI program, a fast program for truck drivers where we vet

them, adjudicate them, and provide them a secure document to do

expeditious crossing across the border.

We have 225,000 people enrolled in those programs on the northern and southern border. Those features will be rolled into a WHTI

requirement because we want to continue to sort out those at a

very low risk and expedite their crossing so we can focus on individual concerns. But it focuses back on a standardized document

that we can read.

Senator BINGAMAN. This Western Hemisphere Travel Initiative.

What is the time frame for getting this done? When will it be to

a point where we can legitimately say everybody coming through

our borders has been inspected to determine whether they have a

14

valid passport, or a PASS card, or whether they are on some other

list of preferred entry that we have set up?

Mr. AHERN. Well, we did an Advanced Notice of Proposed Rulemaking last year. We received over 2,000 comments. Oddly enough,

most of them were from Canada. Most of the people were interested with the cross-border travel with Canada and the United

States.

We currently have our Notice of Proposed Rulemaking at OMB

for review for the January, 2007 implementation of the air and sea

aspect of the Western Hemisphere Travel Initiative, and we are in

the developmental stages of the rulemaking process for the land solution that is due for January of 2008.

Senator BINGAMAN. So in January of 2008, you would expect at

that time to have in place a system for requiring this kind of identification by everybody coming across in our land-based ports of

entry? Is that what I understand?

Mr. AHERN. That is what the current target is, sir. But as you

know, there are different bills being introduced to delay that implementation.

Senator BINGAMAN. The push-back to delay the implementation

is primarily because of what?

Mr. AHERN. Well, I cannot speak to why individuals might have

introduced the legislation or bills, but I can certainly recall, from

looking at some of the 2,000 comments that people made to the

first Notice of Proposed Rulemaking or the Advanced Notice of Proposed Rulemaking last year, a lot of people just feel it is not necessary. A lot of different industries think it will hurt their industry.

A lot of the communities on both borders think that it will impact

cross-border trade.

Some think it will impact cross-border travel, and it would impact communities on both sides of the border. I believe that,

through a well thought out solution and a very efficient process of

issuing of documents, and even looking at alternatives to the standards—not alternatives to the passport, but something that meets

the standard—can certainly accomplish what the goals are for security, and also the efficient cross-border movement of people.

Senator BINGAMAN. Now, what is the timing for issuance of these

PASS cards? If I wanted to get one of these PASS cards, when

would I be able to apply for it, and what would be the process?

Mr. AHERN. Those dates have not been set. We are still in the

formulation stage of that. That will be part of the proposed regulation that would be developed and issued for the land solution,

which has not gone out. Only the air and sea environment has actually made its way through the department into OMB at this

point in time.

Senator BINGAMAN. So the air and sea environment contemplates

that everybody coming into the country by air or by sea have a

passport?

Mr. AHERN. It would be inappropriate for me to tell what the actual final rule is until it clears and actually gets issued, sir.

Senator BINGAMAN. So it is possible that we would allow some

other forms of identification to also serve to allow the entry of people coming here by air or by sea.

15

Mr. AHERN. I would say, again, the passport is the gold standard.

We would need to make sure that anything less than that has the

same security features, is machine readable, and is something that

is an acceptable alternative.

Senator BINGAMAN. Other than the passport and the PASS card,

what meets that criteria?

Mr. AHERN. There would be some documents that we could talk

about, but I would really prefer, sir, until we actually clearly go

through the rulemaking process, I would not want to be contrary

to the Administrative Procedures Act.

Senator BINGAMAN. All right. Thank you, Mr. Chairman.

The CHAIRMAN. I had several other questions. I am just going to

ask a couple, then probably submit the rest in writing. Then for

this panel, as well as the other panel, there are members who

could not come because of conflicts, so maybe you will get questions

for answer in writing.

We would ask the staff to tell their members to get those submitted by 5 this afternoon; I may be more lenient depending on

what my staff says is more appropriate. Then if you could get answers back as soon as you can, we would appreciate it.

I would ask, Mr. Kutz, this is following on where I left off with

Mr. Ahern. During any of the times that you were trying to cross

the border, did CBP ever swipe or scan the driver’s license that you

used through any of the electronic readers?

Was there a time when you thought that they might scan your

license, and if so, would that make you a little nervous about getting caught coming into the country?

Mr. KUTZ. In answer to that, I am going to give Mr. Cooney a

chance to answer that, since he is one of our agents who actually

made the crossings, if that is all right.

The CHAIRMAN. All right. Mr. Cooney?

Mr. COONEY. Yes, Senator. At one port of entry on the southern

border, the license was not scanned. We thought it was. We took

precautions to enter the country and have a story if the license was

scanned.

When we got to the port of entry, we found ourselves in an empty

room with three CBP officers and we had to do a little quick talking, socially engineering the situation, after which we were never

asked to show any identification. We were just asked if we were

U.S. citizens, and then told to come into the country.

The CHAIRMAN. All right.

Mr. Everitt, according to Mr. Ahern’s testimony, CBP has spent

money establishing a Fraudulent Document Analysis Unit. That

sounds a lot like the title of your office, Forensic Document Laboratory.

Mr. Ahern’s testimony also says that one of the things that CBP

did was to deliver ‘‘state-of-the-art fraudulent document work stations.’’ I believe he is referring to some very expensive machines

designed for a laboratory environment, not something that could be

deployed at a primary inspection point. So, it looks like they are

duplicating your efforts rather than using their resources to give

front-line officers the tools they need to do the job of primary inspection.

16

Would you explain the difference between the tools that might

work in secondary inspection and in a lab, and the kind of tools

that are needed for primary inspection?

Second, and last, how much do each of these laboratory-style

work stations cost?

Mr. EVERITT. Senator, I believe the tools that you might be referring to are ones that we have in the laboratory called Video Spectrum Comparators. We have several models within the laboratory.

They range in price anywhere from $30,000 per unit to $90,000 per

unit. They are very expensive.

They are used by the forensic document examiners in the forensic examination of a document. They are quite technical. I would

not believe that they would be appropriate for a primary lane, only

because of the size. They are large. They would require quite a bit

of training to operate and are probably not appropriate for a primary application.

There are some technologies that are available on the market

that we have not looked at, as it is not the job of the Forensic Document Laboratory to evaluate those machines that may be suitable

for primary application. They basically give a red light/green light

on a document as to whether it is authentic or not, based on comparison with a known document that is stored in the database.

Those may be appropriate for primary application. Like I said,

though, it is not something that we would evaluate.

The CHAIRMAN. All right. I will not ask any other questions. But

maybe I should give any of you who want it an opportunity to say

one last thing before we bring in the second panel. I would be glad

to give you a little bit of time.

Mr. Ahern?

Mr. AHERN. Sir, if I could just add on to Mr. Everitt’s comment,

certainly the technology we deployed for document detection is a

secondary technology. It is not for primary.

For primary, secure documents are needed that can be machineread. We have done a lot of issuance of machine readers. Most

every one of our 805 primaries we have on both borders are

equipped with machine readers, document readers.

What we need to get is documents that can be read beyond just

the current number of passports—border crossing cards, permanent

resident cards, and laser visas—that can actually be swept on primaries and run against our systems to be able to make good determinations of who is coming into this country.

The CHAIRMAN. All right.

Anybody else?

Mr. KUTZ. I would say one thing. When we deal with Customs

folks, I just want to say that we have a very positive relationship.

When they hear from us, it is not usually good news. So I want to

just say that usually they act in a very proactive and constructive

manner in working with us, and I do appreciate that, because a lot

of people are not very happy to hear from us usually, Senator.

The CHAIRMAN. All right. Thank you all very much.

I will call the second panel now. I have not introduced the second

panel, so I will do that. Come while I am introducing you.

This is to learn what the private sector is doing to protect itself,

what State government is doing to validate IDs, and what other

17

countries are giving border inspectors as tools to catch fake documents.

Our first person is Janice Kephart, former counsel of the 9/11

Commission and an expert on terrorist travel; second is David

Shepherd, who is director of security for the Venetian Resort Hotel,

an establishment that protects more than 50,000 visitors and millions of dollars a day. He will testify about how they use scanners

to verify documents. A third witness is Mr. Bruce Reeves, CEO of

AssureTec Systems, which has developed an advanced technology,

in use in countries like Chile and Singapore, to check for fake documents; and then, last, Scott Carr is executive vice president of

Digimarc. He will be testifying and demonstrating how such technology could better work together to help protect our borders using

security features already in millions of driver’s licenses.

I thank you all. We will go in the order that you were introduced.

So, you start out, Ms. Kephart.

STATEMENT OF JANICE KEPHART, PRINCIPAL, 9/11 SECURITY

SOLUTIONS, ALEXANDRIA, VA; FORMERLY COUNSEL TO THE

9/11 COMMISSION

Ms. KEPHART. Thank you, Chairman Grassley, for having me

here today to talk about how and why we need to ramp up our U.S.

border inspection policies and practices.

I do not think I need to remind the committee that it has been

nearly 5 years since 9/11, and border inspection has shown little

improvement. The slate of 9/11 hijackers, you might recall, had a

97-percent success rate at entering the U.S. by passing inspectors

34 of 35 times.

Today, GAO tells us that in 45 attempts at entry over our land

borders with fake documents between 2002 and 2006, they were

successful 42 times, or a 93-percent success rate.

In 2006, GAO had a 100-percent success rate at illegal entry. In

this 2006 study, perhaps the most troubling finding is that, when

CBP officers in Michigan and New York did their jobs the best they

could and asked for identity documents and tried to compare them

to verify identities, they were stifled by a complete lack of any tools

to help them authenticate as fake or valid the documents presented

to them.

Without being able to make a determination that the documents

were fake and the agents inadmissible, the government agents

were allowed in, as is standard immigration policy.

Now let me step back and retrace our steps as to why the 9/11

Commission unanimously recommended that we need to ramp up

our border inspection process, require a passport or equivalent at

our ports of entry, and the threat the Commission’s border recommendations seek to mitigate.

We need to ramp up our border security and stop encouraging

the use of fake documents, because we know that terrorists are

trained in document forgery and travel techniques.

Reviewing GAO’s study, it is not difficult to be concerned that

GAO’s success rate at illegal entry could be easily translated into

a potential success rate for terrorist entry. In fact, while I cannot

state specifics in an open hearing, I can tell you that, during my

tenure on the 9/11 Commission, we were privy to information—inVerDate 11-MAY-2000 09:54 Nov 30, 2007 Jkt 095484 PO 00000 Frm 00021 Fmt 6633 Sfmt 6633 38554.000 SFIN1 PsN: SFIN1
18

formation not even included in our staff monograph—that gave us

good reason to be concerned that varieties of fake documents have

been a modus operandi for terrorist entry into the U.S. for years

now.

We also know that terrorist travel poses a specific threat, because terrorists usually require travel across borders to conduct operations. To do so, they will exploit any loophole in a border apparatus that they can. An extremely large loophole that still exists

today here in the U.S., are the policies and practices that permit

anyone claiming to be from the Western Hemisphere to present

easily forged documents, or nothing at all, to enter the U.S.

The most commonly used documents include a birth certificate,

tens of thousands of varieties, a driver’s license, over 240 varieties

in the U.S., or, as is the case with 40 percent of Canadians that

pass over our land borders according to Zogby surveys, absolutely

nothing.

We know birth certificates and driver’s licenses are highly subject to fraud both in the U.S. and throughout the Western Hemisphere. DC sniper John Allen Muhammad and LAX Millennium

bomber Ahmed Rassam both made their living on stealing, making,

and selling fake U.S. or Canadian documents prior to coming to the

U.S. for their criminal acts.

The 9/11 Commission recommended the use of passports or a biometric equivalent because, while no travel document is perfect,

passports have features other documents do not: they denote citizenship; they can be vetted through criminal and terror watch lists

and alerts; national records are maintained on the passport owner,

so reported lost and stolen passports can be better tracked internationally. They have particular security features, usually more

difficult to forge.

From the terrorists’ vantage point, they know we cannot verify

identities with a driver’s license today at our ports of entry, nor authenticate a license as legitimate, so why not take advantage of

U.S. laxity and use a fake?

To briefly review the threat, recall that Canada’s intelligence

service tells us that they are watching at least 350 terrorists, yet

Canadian law enforcement is so curtailed by Canada’s post-9/11

anti-terror laws, that there has been only one indictment, up until

the bust of the 17 in Toronto in June.

In addition, the FBI has million-dollar bounties on a number of

Canadian-based al Qaeda members who have directly threatened

the United States. Recall, too, that south of the border, Mexico is

known for al Qaeda seeking entry through there, both at land ports

and over the physical borders; Hezbollah has smuggled in 200-plus

of its sympathizers; and the Caribbean is a hot-bed of terrorist activity.

Let me be clear, though, that assuring facilitation of trade and

tourism is also important. To do so, we need to give border inspectors the technology, training, information, and policy support together to focus on high-risk travelers, while low-risk travelers can

get streamlined and efficient processing if they seek to do so, thus

securing facilitation equally and providing the necessary policy of

objective balance. With support from the private sector, I believe

that that balance is highly doable.

19

So where does the terrorist end up with border inspection as it

should be? With a difficult choice. With better-trained inspectors

with access to better information and better technologies, and expertise in a few acceptable forms of travel documents instead of

thousands, the terrorist can no longer expect to get away very easily with presenting an unauthenticated document containing unverified information.

Instead, the terrorist must choose now: risk getting caught by attempting an illegal entry, or risk being detected by U.S. authorities

at the border when presenting a passport or equivalent.

Ramped up border security makes it more likely that the terrorist will expose himself to authorities, giving the American people

a better chance at keeping a garden variety of dangerous foreign

terrorists out of the United States.

Thank you.

The CHAIRMAN. Thank you, Ms. Kephart.

[The prepared statement of Ms. Kephart appears in the appendix.]

The CHAIRMAN. Mr. Shepherd?

STATEMENT OF DAVID SHEPHERD, DIRECTOR OF SECURITY,

VENETIAN RESORT HOTEL, LAS VEGAS, NV; FORMERLY

WITH THE FEDERAL BUREAU OF INVESTIGATION

Mr. SHEPHERD. Thank you, sir. Chairman Grassley, distinguished members of the U.S. Senate Committee on Finance, ladies

and gentlemen, thank you for the opportunity to testify before this

very important committee concerning border security.

Currently, I am the co-chairman of the Gaming Resorts Subcouncil for the Commercial Facilities Sector Coordinating Council;

a member of the Partnership for Critical Infrastructure Security; a

member of the Real Estate Round Table Terrorism Task Force; and

a member of the Las Vegas Security Chiefs Association. In each of

these capacities I represent only a small portion of the private sector, and I am honored to be a participant.

In the private sector, the identification of customers, employees,

and business partners is important in protecting the property from

criminals, terrorists, and from individuals who attempt to bypass

existing laws and regulations.

Because of the possibility of misidentification of those who could

do harm to individuals or to a business, financial reporting requirements—the Securities Exchange and Commission, Office of Foreign

Asset Control, Sarbanes-Oxley, and gaming control regulations—

were enacted by those agencies with foresight on the identification

of individuals.

Each private sector business has an obligation to its employees,

guests, and the community at large to know the identity of individuals who interact with the company. The private sector partners

are cornerstones of the entire community; thus, safety is the underlying common element for proper identification recognition, not the

potential for fines or business restriction if non-compliance is uncovered by a regulatory agency.

Regardless of the fake driver’s licenses used by a seemingly innocent under-aged individual attempting to gamble in a casino or

enter a nightclub, that same fake driver’s license in the hands of

20

a criminal could have significant financial impact on property

through fraudulent financial transactions, in the form of existing or

extending credit, application for a loan, or credit card purchases. In

the hands of a terrorist, the catastrophic events of 9/11 or the London train bombings could be repeated within our borders.

The fake identification is a means to an end, and the choice of

that end is the possessor’s. Las Vegas has already seen the face of

terrorism, as eight of the deadly hijackers visited my city prior to

9/11. Unfortunately, those were never detected by the individual

systems in place.

If you will look at the monitor, we will present different fake and

real identifications. Speed and accuracy in recognizing false identifications are important elements in a system of protection for a

business.

Determining if a person is 21 before he or she is served alcoholic

beverages, or if the individual is actually John Doe before extending a line of credit, or even offering a position within the company

to a seemingly qualified applicant cannot be left to chance or to an

individual’s discretion.

Unfortunately, there are over 10 million cases of identity theft in

the United States each year. The Internet provides instructions on

how to create false identification.

Technologies have been used by the criminal element to replicate

fake identifications, regardless of the State or country of origin.

Thus, technology should be employed to keep ahead of those who

attempt to circumvent the system.

I have had an opportunity to review various technologies and

systems currently available within the private sector which offer

full or partial solutions to security and regulatory challenges under

financial, criminal, civil, risk management, and terrorism concerns.

In the commercial facility sector, many private partners have deployed systems to identify fake driver’s licenses, passports, and

visas offered as proof of identification. One of the systems that is

here is available today.

In addition to this system, there are other systems available that

currently focus on driver’s licenses or credit cards, without referring to reference manuals and without unduly inconveniencing

those individuals who are being screened.

Thank you for the opportunity to speak.

The CHAIRMAN. Thank you, Mr. Shepherd.

[The prepared statement of Mr. Shepherd appears in the appendix.]

The CHAIRMAN. Mr. Reeves?

STATEMENT OF BRUCE REEVES, CEO,

ASSURETEC SYSTEMS, MANCHESTER, NH

Mr. REEVES. Thank you, Chairman Grassley and other members

of the committee. First, we also want to thank you for inviting us

to give testimony regarding commercially available technologies to

assist our border inspectors in detecting fraudulent documents.

AssureTec Systems of Manchester, NH is one of the companies

providing automated document authentication technology. It has

already been established, and we certainly want to weigh in and

agree, that the issue we are dealing with here is not the fault of

21

the border agents who are serving our country in a very valiant

way.

The problem, really, is the issue that technology needs to be

made available, real-time, with both accuracy and significance, that

in effect can log in a transaction so we know who, in fact, has

crossed the border, as well as determining the validity, or at least

the risk factor, of the documents presented.

I have been specifically asked to address three basic questions:

first, the current viability and availability of the technology; second, examples of the technology in various places and by other governments; and finally, an estimated cost for adding this technology

to a typical U.S. border.

Our company delivered its first technology border product in February, 2004. I have on the board—I will not speak specifically to

it because there is not time, but would be open to questions—a

schematic for a system of automated document authentication

which, in effect, becomes an exit/entry system in the country of

Chile.

This technology has been integrated by the Chilean government

to include document exit/entry and picking up of the information

that is being delivered when someone crosses a border. An attempt

has also been made to take state-of-the-art biometrics and move

those into the solution with existing documents.

This solution operates behind the scenes and, in a few seconds,

delivers an alert, very similar to what you have seen, in this case

on the border, in the event the system detects a problem or exceeds

a particular level of risk.

When alerts are encountered, the operator or the border agent

can click on the specific item for further detail and drill down.

A similar border management solution has recently been installed by Merit Technologies of Melbourne, Australia in Papua

New Guinea for a totally integrated border exit/entry system.

There, they also included the capability to match, in addition to

watch lists integrated with our technology, solutions to vet passenger manifest systems that are sent to the U.S. and other countries involving flights in and out of the country.

Our systems are currently being used daily in both Thailand and

Singapore in the e-passport enrollment process for the issuance of

new electronic passports that will be used around the world. In

short, the answer to the question is that the technology is readily

available off the shelf, and is being deployed by other governments.

Our system is installed in a particular U.S. embassy in an area

where documents are very suspect, and in the course of review of

about 25,000 documents that are used to get visas to enter the

United States, hundreds of bad documents and fakes have been

found.

For the past 18 months, our system has been deployed in the

Transportation Worker Identity Credential, TWIC, program, Phase

III, which now is in the process of being reviewed for deployment

to the next level. That has been used for approximately 18 months.

The third question was trying to estimate the price. Our company does not typically provide end-user application pricing. We

normally work through systems integrators around the world.

22

In this case, using the GAO’s recent analysis that on the order

of 300,000 to 400,000 entries are made at the U.S. borders, and estimating about 80 to 85 percent are land borders, I would say that,

with the 500 or so lanes that are currently being utilized by border

inspectors in the land borders, that the cost of our typical technology of the high-end product would be in the range of about

$4,000 to an integrator, perhaps twice that number on a solution

and integrated basis, and would operate approximately at a cost of

between a third of a cent per crossing to less than a penny per

crossing on an integrated basis, using a 3-year model.

To conclude, we believe automated document authentication is

both commercially available and economical. Thank you for inviting

me to testify today, and I am willing to answer further questions

if you wish.

The CHAIRMAN. Thank you.

[The prepared statement of Mr. Reeves appears in the appendix.]

The CHAIRMAN. Now, Mr. Carr?

STATEMENT OF SCOTT CARR, EXECUTIVE VICE PRESIDENT,

DIGIMARC, BEAVERTON, OR

Mr. CARR. Chairman Grassley, thank you for the opportunity to

appear today before the committee to testify.

I come to you from Digimarc Corporation. We are the leading

provider of citizen identity documents in North America. We

produce 60 million secure IDs a year, including two-thirds of U.S.

driver’s licenses.

We are also an innovator in a technology known as digital

watermarking. This technology has been used in currency, identity

documents, music and movies, to deter piracy and counterfeiting.

In fact, in 2002, States began to adopt this in driver’s licenses

as a machine-readable security feature to authenticate those documents. Eighteen States have adopted digital watermarking as of

today, including States like Florida, Texas, Massachusetts, Iowa,

Nebraska, New Jersey, and Michigan.

In Michigan, more than 75 percent of the circulating licenses

contain digital watermarks. This feature can be authenticated at

the border in seconds to detect fake IDs.

We, too, were asked to estimate the cost of deploying the technology, and while we do not have all of the information about the

extent of the deployment, our estimate is that readily available

technology that has been proven and is available could be deployed

in 6 to 12 months, at a cost of less than $50 million.

Digital watermarking is compatible with the Western Hemisphere Travel Initiative, with Real ID, and with the U.S. VISIT

program. It is used to secure driver’s licenses and could also be

used to secure passports, the proposed PASS card, Federal worker

credentials, and other forms of travel documents.

We commend the committee’s efforts to challenge all of us to improve U.S. border security, and we recommend that machinereadable authentication of driver’s licenses and other identity documents be conducted at the U.S. borders, and that this include machine-readable authentication of the digital watermark.

23

We support closing the Western Hemisphere travel loophole, and

in fact believe this can be accomplished by harmonizing WHTI and

the Real ID program.

What I would like to do now is demonstrate how some of this

technology works. What we have are two Nebraska driver’s licenses

which, if you look at them, appear identical. In fact, the name and

demographic data on the front of the cards are the same. What is

different are the photos. The pictures of the people are different.

One of these IDs is fake.

Simple visual inspection is not going to determine which is

which. My colleague will place the document in a readily available

scanner. This scanner will scan both sides of the document, essentially taking a picture of the front and the back.

The software will decode the bar code, read the digital watermark, and inspect other features that are found in the document

to determine if, in fact, it is authentic. You can see here by the

green indicator that this is the valid ID.

This technology has been deployed in the States, and in fact a

pilot was funded by the U.S. Department of Transportation in Nebraska, where readers were deployed in police cruisers, convenience stores, bars, nightclubs, and other public events. One hundred percent of the users found that the use of digital watermarkbased authentication gave them confidence that the document was,

in fact, authentic.

We will take the second ID now and repeat the process. Again,

we place it in this readily available scanner, we scan the document,

and as you can see, we detect that, here, the photo has been

swapped. This is the fake ID. Digital watermarking allows you to

detect photo swapping, data alteration, and other forms of common

counterfeiting.

As I mentioned, digital watermarking is compatible with WHTI,

U.S. VISIT, and other forms of travel documents. Here, we will

switch to a different reader where we will scan the document as

we did before, we will read the 2–D bar code, and we will allow the

scanner to read the front of the document.

In this case, it is a Massachusetts driver’s license. Here, we will

do complex pattern recognition, we will read the digital watermark,

and we will compare all of that information to determine that this

is, in fact, a valid ID. This authentication can happen in seconds.

The technologies are readily available today. The equipment that

you see on the table in front of you is sufficient to equip three lanes

at a border crossing. We believe that these can be deployed to enhance the security of the U.S. border.

Thank you for the opportunity to testify.

[The prepared statement of Mr. Carr appears in the appendix.]

The CHAIRMAN. I am going to start with you, Mr. Carr, and Mr.

Shepherd. Do you believe that if these scanners had been installed

in all of our primary inspection points, that the Government Accountability Office would have been caught when they showed their

fake driver’s license?

Mr. CARR. Mr. Chairman, we do believe that we could have

caught the fake IDs that the GAO used to cross the border.

The CHAIRMAN. Mr. Shepherd?

Mr. SHEPHERD. I believe the same thing, sir.

24

The CHAIRMAN. All right.

Now, of course, the witnesses from the Government Accountability Office are still here and they have the fake driver’s licenses

with them that were actually used to cross the border. I would like

to have your personnel run them through the scanners and see

what happens.

Now, for security reasons, I would like to ask the press not to

take any photos of the television screen during this demonstration.

Mr. CARR. As you can see, my colleague is scanning the document in the same way we did in the prior test. The software is analyzing the features that are present on the document to determine

if it is authentic. You can see that this document would have been

caught if presented at the border.

The CHAIRMAN. All right.

To Ms. Kephart, it looks pretty clear that something like this

might have caused a little trouble for our Government Accountability Office investigators. Judging from what you have seen here

today, do you believe that we need to install technology like this

to help stop terrorists from doing what the Government Accountability Office did?

Ms. KEPHART. Well, Mr. Chairman, we know that terrorists

thrive on forgery. They thrive on any variety of forgery they can

use. So when you see something like this, which is efficient and effective, then it makes you believe that we can stop the forms of terrorist entry that involve forgery.

The CHAIRMAN. All right.

How likely, again, Ms. Kephart, do you think it is that terrorists

or criminal fugitives trying to cross our border might try to bluff

their way with a fake driver’s license or other documents?

Ms. KEPHART. We know that John Allen Muhammad, criminal—

whatever you would like to call him—used this as a primary means

of getting into the United States for a number of clients. It would

not at all be surprising that it has been a modus operandi for quite

a while.

As I said in my oral statement, when I was on the Commission

I was privy to information that indicated that we had quite a large

number of terrorists residing here in the United States, and we did

not know how they got in.

If we had watch lists in effect with passports, and these people

were watch-listed, then how did they get in if they did not get in

under an assumed identity or a fake document?

The CHAIRMAN. I would give all of you on the panel an opportunity to share some success stories where technology like this has

been used and resulted in catching people using phony documents.

Mr. SHEPHERD. Sir, in my particular industry we have caught

people using fake driver’s licenses or credit cards who were trying

to gain credit at the property. We have used that to try to prevent

them from causing damage either to the property, financially, or to

the people within the property.

The CHAIRMAN. All right.

Mr. CARR. Chairman Grassley?

The CHAIRMAN. Yes.

Mr. CARR. Our technology has been deployed in a variety of locations, including Departments of Motor Vehicles, for enrollment. I

25

will give you two examples of where people have been caught. We

have a particular State that has caught people on the terrorist

watch list by using these kinds of technologies in the enrollment

process.

We have another State that has deployed a system like what you

have seen here today, where, in fact, illegal immigrants, within a

day of hearing that this kind of document authentication has been

deployed in an office, changed their pattern of application to move

to other offices. This repeated over the course of five times, as different technologies like this were rolled out in those offices.

Mr. REEVES. Just to confirm; internationally, very recently, we

were deploying in a pilot at a name-brand bank—I will not mention

the bank—and this technology was available in the account opening part of the bank.

Within the first week, six fraudulent documents from very significant countries that one would be very concerned about, were

found. After that first approximately 4 days, we found no false documents in that particular branch following that, exactly the same

issue. This is a very organized process, and word gets out.

The CHAIRMAN. Because the word got out.

Mr. REEVES. Word got out that this branch can find bad documents. Very similar, a deployment at another bank, a pilot, in this

country very close to where we are now, the common fraud is,

someone will steal a good Mastercard check and then will make up

a false document to match the identity on the Mastercard check.

This was put in a high-crime branch, so we thought we would see

a high level of fraud.

Literally, I believe it was the first day, possibly the second day, a person came in, tried to cash a check. It was a $5,000 check.

When he saw what the teller was doing, going back and looking at

this technology, literally ran out of the bank, left the check, left the

card, and has never been seen since.

We have a number of systems deployed at one of our U.S. embassies. I do not want to disclose it for security reasons. I would be

happy to share with the committee where it is.

It has been deployed and has run 25,000 to 30,000 applications

for enrollment of new visas. The word from them, when we updated

them for the purposes of this committee, was ‘‘we found hundreds

of false documents.’’ So, I think that is a very dangerous statistic.

The CHAIRMAN. Back to you, Mr. Reeves. It happened in June

this year, I believe it was, that the father-in-law of a victim of the

World Trade Center attack used a counterfeit Mexican Matricula

card to enter the headquarters of the U.S. Department of Homeland Security here in this city.

Are you aware of any steps taken by the Department of Homeland Security in response to this incident? Have they looked at purchasing this type of scanner technology to protect the Department

of Homeland Security Headquarters?

Mr. REEVES. We received an inquiry, I believe it was either the

next day or 2 days following the publication of that event, which

was very similar to this current GAO test. We had discussions with

officials of DHS.

We also were asked for pricing. Initially we were asked for pricing for 2 units. We then were called back for pricing for 4 units.

26

We then were almost immediately called back for pricing for 6

units. Our understanding was that there are six entrance systems

around their building.

We then received, from one of our re-sellers who re-sells our

equipment as well, that they had been contacted as well relating

to this same issue within a few days.

To the best of my knowledge, we have not actually received the

purchase order, so in fact we have not actually sold these to DHS.

But that is the status, as we understand it.

The CHAIRMAN. Well, it would seem to me, if they are thinking

about doing it to protect their headquarters, it ought to be good

enough then to protect our borders as well.

Now, I would like to get to something about cost. I recognize that

you at the table may not have enough information to give us detailed price quotes today, but we asked you to provide some rough

cost estimates in your testimony.

According to CBP, there are between 500 and 1,000 total inbound

lanes at our ports of entry—that would be collectively, all over the

country. According to a rough estimate you have given us, it looks

like every lane could have technology similar to what we have seen

here today for something in the tens of millions of dollars, in other

words, a fraction of 1 percent of the Department’s $35 billion

budget.

Is that within the ballpark as any of you would see it?

Mr. REEVES. Well, I think Mr. Carr mentioned the number of $50

million being for fully deployed. That would be a system solution

that would give you logging in of the crossing, as well as the technology to support it. I think my number was $2 million for the initial technology, with service costs running another $400,000 a year.

So on a 3-year model, it would be about $3.2 million.

Rule of thumb would be that a fully deployed, integrated system

would be 2 to 3 times that number, so that would take you to about

$10 million on the outside for deployment of just the land borders.

Of course, you would then have discussion on whether you migrated that to include the lanes in the airports and sea crossings

as well.

The CHAIRMAN. All right.

Now, if there is no dispute over what he said, I will go on. I

wanted to ask, is there any dispute there or anything to be added?

[No response.]

The CHAIRMAN. All right.

Then I will go to Ms. Kephart. If that would be about right, what

kind of bang for the buck do you think that that would be in terms

of catching, or at least deterring, terrorists and fugitives from

using fake documents crossing our border? Would this be a good interim step to take before WHTI and the Real ID are fully implemented?

Ms. KEPHART. Well, you are talking about what I have always

talked about, what we need to do to create effective and efficient

borders. What we are talking about here, it seems to me, in watching the demonstrations, is that you have both effectiveness and efficiency built into this at a cost that is very low considering what

you get for it.

27

We know that terrorists get shy very quickly when they think

they are going to be caught. When I hear the stories here from the

answers to questions about the deterrent effect it is having on

banks, I cannot imagine that it would not have the same deterrent

effect at our ports of entry.

The CHAIRMAN. Again, to anybody who wants to, but I am directing it to the whole panel, we heard from the Government Accountability Office that CBP failed to run name checks on their investigators, and they do not really have time to run name checks on

every person crossing the border.

Would anyone like to explain how technologies like these could

help CBP run name checks more often and more efficiently?

Mr. CARR. Mr. Chairman, our customers in the Departments of

Motor Vehicles routinely use these kinds of technologies that both

scan the document to authenticate it, but also reach out to databases to validate those kinds of identities, like the case that I mentioned where, by making that kind of a check, they were able to

determine that the person standing in front of them applying for

a driver’s license was in fact on the terrorist watch list.

In this case, it was the Department of Public Safety, where not

only did they refuse to issue the license, but they put the person

in jail.

Mr. REEVES. Just to supplement that, I think one thing that may

have been said, but may not be really obvious, is that the key to

this kind of technology is the ability to read non-standard documents, so that when you are establishing and relying on building

the entry or the record of that particular transaction, the ability to

read non-standard documents is what really sets the technology

apart and makes it universal.

Part of the services that are provided with the technology is the

ability to enroll documents when, at a particular border or a particular entry point, new documents are being found.

That, in fact, is part of the technology, to vet those documents

and build those and bring them into the library and the database

so it becomes universal, so that any document being presented that

the government is willing to accept, then can be part of this exit

program, and then twice that number you would move it into an

exit/entry system.

The CHAIRMAN. All right. Anybody else want to respond before

I go to the next question?

[No response.]

The CHAIRMAN. Ms. Kephart’s prepared testimony discussed the

possibility of using real-time lost and stolen passport data from

Interpol at checkpoints. I am wondering if this technology could

work with that information.

Can anyone explain whether it would be possible, just as an example, to automatically read passports with these kinds of scanners, even if the passports were not originally designed to be machine readable, and then check their numbers against the list of

known lost or stolen numbers?

Mr. REEVES. The short answer, if I could take that, Mr. Chairman, is, yes, this technology is already being used that way. Effectively, very often people are issued documents, passports, valid

passports, in embassies. These passports generally are not standVerDate 11-MAY-2000 09:54 Nov 30, 2007 Jkt 095484 PO 00000 Frm 00031 Fmt 6633 Sfmt 6633 38554.000 SFIN1 PsN: SFIN1
28

ard from the standpoint of looking like every other passport that

was issued in a passport office.

All of that technology, including the ability to enroll known

fakes, the ability to enroll known stolen documents, can all be built

into the system and it will not slow it down. It will operate at the

same speed.

The CHAIRMAN. Anybody want to add? Go ahead, Ms. Kephart.

Ms. KEPHART. Well, just to discuss a little bit about Interpol’s

Lost and Stolen Passport database. That database right now has

100 countries enrolled in it, over 11 million lost and stolen passports in it. The case right now is that, at our ports of entry, that

database of information, which can be downloaded real-time every

24 hours, is only available, still, in secondary inspection.

It would not be very hard to download that information into text,

which is what primary inspectors check automatically when they

do name checks, et cetera, and it is still not there.

So I have a little policy statement to make about the fact that

it is still not available in primary. It would need to be available,

I believe, in primary for these folks and their technology to be able

to have access to it.

Mr. REEVES. Could I just, further, make one comment? In order

to do this vetting, this data—the data generated by somebody presenting a document—can be put up to a trust authority. You do not

even need this on the front line.

Privacy is something that can be dramatically improved by this

type of technology, and using it against very important, well-maintained, secret trust authorities so that even that front-line border,

or even the secondary border, does not have to have access to the

actual information, merely the ability to ping that presented information back to that trust authority.

That privacy concern is really what we are seeing with various

State legislators and other things. That is, their real beef with the

Real ID Act is that really they are moving the data back and forth

as opposed to vetting a particular identity and an identity document against that information, and if it checks out, then you know

you have good information. So, privacy, I think, can also be dramatically benefitted, not demeaned, in using this type of technology.

The CHAIRMAN. Mr. Carr?

Mr. CARR. If I might, Mr. Chairman. The use of digital watermarking and other security features like this to authenticate the

document is a means to make sure that that token that I am starting with, the document that I have been presented as an inspector,

is, in fact, authentic. That can happen without compromising citizen privacy. The connections to a database can be made, if appropriate, within the context of policy and with security.

Today, with 35 million driver’s licenses carrying watermarks and

that number growing daily, from States that have really stepped

out as leaders in innovating in security, like Iowa, which has added

digital watermarking to the license, enhanced security features,

and new document designs, we really do have tools that can aid in

that front-line inspection to improve border security.

The CHAIRMAN. All right.

29

One last question, then. Again, to anybody, or the whole panel.

Many of you are involved in working with State governments to

help them comply with the Real ID Act and are knowledgeable

about the progress towards implementing WHTI.

The administration says it will be ready and can implement both

laws by their original deadlines in 2008. Would any of you like to

describe your view of how ready our government is to start complying with these important security measures on time?

Mr. CARR. Mr. Chairman, I would like to comment.

The CHAIRMAN. You start out.

Mr. CARR. Thank you. What I would say is, Real ID is an opportunity to enhance the security of the driver’s license, a critical identity document, across our Nation.

What is needed at this point are a set of well-defined standards

that States can begin to implement against so that they know what

is required of them to get from here to the implementation deadline.

Funding is also going to be required in order to allow them to

implement the system upgrades and changes that are necessary to

get there. Many States have moved out ahead of those decisions

being made. Texas, for example, will introduce a new driver’s license which incorporates state-of-the-art security that allows an inspector to both feel that the document is genuine, see that the document is genuine, and machine-authenticate it with technologies

like digital watermarking.

So, in order to get to the deadline, we must address both standards and funding as a vehicle to move the States forward.

The CHAIRMAN. Mr. Reeves?

Mr. REEVES. Mr. Chairman, coming from the State of New

Hampshire, the ‘‘Live Free or Die’’ State, the legislature in the

State of New Hampshire made a stand, if you will, relating to a

grant that was made available under the Real ID Act.

I could just not reinforce enough, as I have talked to the legislators—my wife is a legislator—that in the State of New Hampshire,

the two issues that effectively became the controversial issues

where this ended up getting tabled, whether or not to accept a

major grant from the U.S. Government, was, one, they are saying

these programs do not work; they ask us to do stuff and it does not

increase our security.

The other part was, effectively, privacy. They are asking for more

and more information, they have bigger and bigger databases, they

are aggregating all this information. It is Big Brother.

Those two things, I think, are the report that I am receiving from

the legislators in the State of New Hampshire, and I do not think

they are unique. So I think, just for a comment, I think that is a

big impediment with a number of the States.

As far as the fine tuning, I think if the privacy paradigm, some

of the kinds of issues that are being dealt with by this committee

right now, if they could be modified or impacted for Real ID, it

would make a major difference in the State of New Hampshire. I

will not speak for any other State.

The CHAIRMAN. Anybody else want to throw anything in at the

tail end here?

[No response.]

30

The CHAIRMAN. Outside of thanking all of you and the previous

panel for participating, I would say that we have also learned some

really important things today. Of course, I am very disappointed

with the results of the GAO study.

Not how GAO did it, because obviously they have demonstrated

what we were hoping would not be the case, that it is easy to enter

our country through the front door. But it looks like, particularly

from this panel, that there are some workable solutions.

Of course, I hope there are people from the Department of Homeland Security who stayed behind. I do not know whether they did.

I saw the people that were on the panel walk out afterwards, but

it would have been nice if they could have seen this.

I hope that they learn something from this and that they would

take some time to look at these tools that are available to help

them in their job of keeping our country safe.

Now, in regard to the Western Hemisphere Travel Initiative, I

think we heard today that that is very important. In fact, that is

the basis for DHS not doing anything, because they are looking for

the perfect way to do it, and that is that initiative.

I think we have to make sure that that is established on time.

With that thought in mind, I am sending a letter to conferees of

the Department of Homeland Security appropriation bill, requesting that they remove language from the Senate version which has

the potential for indefinitely extending that deadline for the WHTI

program.

We have heard that CBP thinks that this program is very important, and they are prepared to implement it by the deadline. I

think it would be foolish to extend the deadline and then continue

to keep the front door open. Obviously, we are all concerned about

our Nation’s security and maintaining strong, safe borders.

With that in mind, I think CBP should be on notice that this

committee is going to continue to monitor their efforts. In fact, I

am going to ask that CBP provide me with updates in what they

are doing to fix the problem, and I would ask them to do that every

3 months until it is fixed.

I raised this point before. I do not want to be holding a hearing

a year from now, or 2 years from now, and find out, as we did

today, that there is nothing too much different in the situation, as

evidenced by the measuring stick of the Government Accountability

Office, from the way it was 3 years ago.

So you would hope that within a year, then, that the CBP failure

rate would fall from that 93 percent that is demonstrated by this

chart, down to 0 percent, which would be possible with this technological equipment. The driver’s licenses used by the Government

Accountability Office would have been exposed; we have seen that

very clearly.

The record is going to remain open through close of business Friday, August 11. If Senators and staff who are here would like to

submit questions for our witnesses, do so by that deadline.

Thank you all very much. I appreciate your testimony.

[Whereupon, at 11:50 a.m., the hearing was concluded.]

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