The Immigration Reform and Control Act of 1986 created the Visa Waiver Program as a pilot program. It was initially envisioned as an immigration control and economic promotion program, according to State. Participating countries were selected because their citizens had a demonstrated pattern of compliance with U.S. immigration laws, and the governments of these countries granted reciprocal visa-free travel to U.S. citizens. In 2000, the program became permanent under the Visa Waiver Permanent Program Act. In 2002, we reported on the legislative requirements to which countries must adhere before they are eligible for inclusion in the Visa Waiver Program. In general, these are the requirements: A low nonimmigrant visa refusal rate. To qualify for visa waiver status, a country must maintain a refusal rate of less than 3 percent for its citizens who apply for business and tourism visas. A machine-readable passport program. The country must certify that it issues machine-readable passports to its citizens. As of June 26, 2005, all travelers are required to have a machine-readable passport to enter the United States under this program. Reciprocity. The country must offer visa-free travel for U.S. citizens. Figure 1 shows the number of foreign nationals admitted to the United States under the program in recent years (see app. III for more detailed admissions statistics). Persons entering the United States under the Visa Waiver Program must have a valid passport issued by the participating country and be a national be seeking entry for 90 days or less as a temporary visitor for business or have been determined by CBP at the U.S. port of entry to represent no threat to the welfare, health, safety, or security of the United States; have complied with conditions of any previous admission under the program (for example, individuals must have stayed in the United States for 90 days or less during prior visa waiver visits); if entering by air or sea, possess a round-trip transportation ticket issued by a carrier that has signed an agreement with the U.S. government to participate in the program, and must have arrived in the United States aboard such a carrier; and if entering by land, have proof of financial solvency and a domicile abroad to which they intend to return. Following the events of September 11, 2001, Congress passed additional laws to strengthen border security policies and procedures, and DHS and State instituted other policy changes that have affected a country’s qualifications for participating in the Visa Waiver Program. For example, all passports issued after October 26, 2005, must contain a digital photograph printed in the document; passports issued to visa waiver travelers after October 26, 2006, must be electronic (e-passports). E- passports aim to enhance border security by making it more difficult to misuse the passport to gain entry into the United States. Travelers with passports issued after the deadline that do not meet these requirements must obtain a visa from a U.S. embassy or consulate overseas before departing for the United States. In addition, the May 2002 Enhanced Border Security and Visa Reform Act required that participating countries certify that the theft of their blank passports is reported to the U.S. government in a timely manner. Moreover, the act increased the frequency—from once every 5 years to once every 2 years—of mandated assessments of the effect of each country’s continued participation in the Visa Waiver Program on U.S. security, law enforcement, and immigration interests. The Visa Waiver Program has many benefits, including facilitating international travel for millions of foreign citizens seeking to visit the United States each year, creating substantial economic benefits to the United States, and allowing State to allocate resources to visa-issuing posts in countries with higher-risk applicant pools. However, there are inherent security and law enforcement risks in the program that pose challenges to the United States. The Visa Waiver Program was created to facilitate international travel without jeopardizing the welfare or security of the United States, according to the program’s legislative history. In fact, visa waiver travelers have represented about one-half of all nonimmigrant admissions to the United States in recent years, as demonstrated by figure 2 below. According to economic and commercial officers at several of the U.S. embassies we visited, visa-free travel to the United States boosts international business travel and tourism, as well as airline revenues, and creates substantial economic benefits to the United States. In its report accompanying the 2000 bill to make the program permanent, the House Committee on the Judiciary acknowledged the program’s importance to the U.S. travel and tourism industry, and the benefit it provides to American citizens by allowing reciprocal visa-free travel to visa waiver countries. As we reported in 2002, any decision to eliminate the program could discourage some business and tourism in the United States. In addition, visa waiver countries could begin requiring visas for U.S. citizens traveling to the 27 participating countries for temporary business or tourism purposes, which would impose a burden of additional cost and time on U.S. travelers to these countries. Moreover, the program allows State to allocate its resources to visa- issuing posts in countries with higher-risk applicant pools. In 2002, we reported that eliminating the program would increase State’s resource requirements. Specifically, if the program were eliminated, we estimated that State’s initial costs at that time to process the additional workload would likely range between $739 million and $1.28 billion and that annual recurring costs would likely range between $522 million and $810 million. For example, millions of visa waiver travelers who have benefited from visa-free travel would need to obtain a visa to travel to the United States if the program did not exist. Furthermore, we reported that U.S. officials, including those from State as well as from some law enforcement agencies, said that eliminating the Visa Waiver Program could have negative implications for U.S. relations with governments of participating countries and could impair their cooperation in efforts to combat terrorism. The Visa Waiver Program can pose risks to U.S. security, law enforcement, and immigration interests because some foreign citizens may exploit the program to enter the United States. In particular, visa waiver travelers are not subject to the same degree of screening as those travelers who must first obtain a visa before arriving in the United States. Furthermore, lost and stolen passports from visa waiver countries could be used by terrorists, criminals, and immigration law violators to gain entry into the United States. Since September 11, 2001, the visa issuance process has taken on greater significance as an antiterrorism tool, as we have previously reported. Those travelers who must apply for visas before traveling to the United States receive two levels of screening before entering the country (see fig. 3). However, visa waiver travelers are first screened in person by a CBP inspector once they arrive at the U.S. port of entry, perhaps after having already boarded an international flight bound for the United States with a fraudulent travel document. For visa waiver travelers, CBP primary inspectors observe the applicant, examine his or her passport, collect the applicant’s fingerprints as part of the U.S. Visitor and Immigrant Status Indicator Technology program (US-VISIT), and check his or her name against automated databases and watch lists, which contain information regarding the admissibility of aliens, including known terrorists, criminals, and immigration law violators. However, according to the DHS OIG, primary border inspectors are disadvantaged when screening Visa Waiver Program travelers because they may not know the alien’s language or local fraud trends in the alien’s home country, nor have the time to conduct an extensive interview. In contrast, non-visa-waiver travelers, who must obtain a visa from a U.S. embassy or consulate, undergo an interview by consular officials overseas, who conduct a rigorous screening process when deciding to approve or deny a visa. As we have previously reported, State has taken a number of actions since 2002 to strengthen the visa issuance process as a border security tool. Moreover, consular officers have more time to interview applicants and examine the authenticity of their passports, and may also speak the visa applicant’s native language, according to consular officials. Inadmissible travelers who need visas to enter the United States may attempt to acquire a passport from a Visa Waiver Program country to avoid the visa screening process. One of the Visa Waiver Program Oversight Unit’s primary concerns is the potential exploitation by terrorists, immigration law violators, and other criminals of a visa waiver country’s lost or stolen passports. DHS intelligence analysts, law enforcement officials, and forensic document experts all acknowledge that misuse of lost and stolen passports is the greatest security problem posed by the Visa Waiver Program. Lost and stolen passports from visa waiver countries are highly prized travel documents, according to the Secretary General of Interpol. Moreover, Visa Waiver Program countries that do not consistently report the losses or thefts of their citizens’ passports, or of blank passports, put the United States at greater risk of allowing inadmissible travelers to enter the country. Fraudulent passports from Visa Waiver Program countries have been used illegally by travelers seeking to disguise their true identities or nationalities when attempting to enter the United States. For example, from January through June 2005, DHS reported that it confiscated, at U.S. ports of entry, 298 fraudulent or altered passports issued by Visa Waiver Program countries that travelers were attempting to use for admission into the United States (see table 1). Two more recent cases demonstrate continued attempts to enter the United States with fraudulent passports issued by visa waiver countries: In December 2005, a Pakistani citizen attempted to enter the United States under the program with a counterfeit United Kingdom passport that she had purchased. During secondary inspection, the CBP officer detected flaws in the passport.