Investigators found  numerous examples of aliens and U.S. citizens obtaining U.S. passports  using a false identity or the documentation of others to hide their true  identity. Applicants commit passport fraud through other means, including  submitting false claims of lost, stolen, or mutilated passports; child  substitution; and counterfeit citizenship documents. Assuming the identity of a deceased person is another  means of fraudulently applying for a passport. Passports Used to Commit Other Crimes

According to State Bureau of Diplomatic Security documents, passport  fraud is often commited in connection with other crimes, including  narcotics trafficking, organized crime, money laundering, and alien  smuggling. According to Diplomatic Security officials, concerns exist  within the law enforcement and intelligence communities that passport  fraud could also be used to help facilitate acts of terrorism. State Faces Challenges to Fraud Detection Efforts

One of the key challenges to State’s fraud detection efforts is limited  interagency information sharing. CLASS Does Not Include Names of All Wanted Federal and State Fugitives

Because the FBI and other law enforcement agencies do not currently  provide State with the names of all individuals wanted by federal law  enforcement authorities, State’s CLASS name-check system does not  contain the names of many federal fugitives, some wanted for murder and  other violent crimes; these fugitives could therefore obtain passports and  potentially flee the country. State officials became aware of this  situation when the union representing passport examiners brought to their  attention that a number of individuals on the FBI’s Ten Most Wanted list  were not in CLASS. Limited Intra-agency Information Sharing May Be Affecting Fraud Detection

State does not maintain a centralized and up-to-date electronic fraud  prevention library, which would enable passport-issuing office personnel  to efficiently share fraud prevention information and tools. Interoffice Transfers of Passport Adjudication Workload Result, in Some Cases, in Fewer Fraud Referrals Back to Originating Office

State routinely transfers adjudication cases among the different offices to  balance workloads, and Fraud Prevention Managers at a number of issuing  offices said they had noticed a lower percentage of fraud referrals  returned to them from the 3 offices that were assigned a bulk of the  workload transfers. In commenting on a  draft of our report, State said that it is adapting and expanding computer- based training for U.S. Effect of New Examiner Performance Standards on Fraud Detection Remains Unclear

Although State’s approach to developing new nationwide passport  examiner production standards, implemented in January 2004, raises  methodological concerns, subsequent changes to the standards make an  assessment of their impact on fraud detection premature. State developed  new nationwide passport examiner production standards in an effort to  make performance expectations and work processes more uniform among  its 16 issuing offices. Responding to concerns about  their fairness due to changes that may have slowed the examination  process, as well concerns that the new standards led examiners to take  “shortcuts” in the examination process to meet their number targets, State  made a number of modifications to the production standards during the  year. This is a work of the U.S. government and is not subject to copyright protection in the  United States.
Why GAO Did This Study

Maintaining the integrity of the U.S. passport is essential to the State Department's efforts to protect U.S. citizens from terrorists, criminals, and others. State issued about 8.8 million passports in 2004. During the same year, State's Bureau of Diplomatic Security arrested about 500 individuals for passport fraud, and about 300 persons were convicted. Passport fraud is often intended to facilitate other crimes, including illegal immigration, drug trafficking, and alien smuggling. GAO examined (1) how passport fraud is committed, (2) what key fraud detection challenges State faces, and (3) what effect new passport examiner performance standards could have on fraud detection.

What GAO Found

Using the stolen identities of U.S. citizens is the primary method of those fraudulently applying for U.S. passports. False claims of lost, stolen, or damaged passports and child substitution are among the other tactics used. Fraudulently obtained passports can help criminals conceal their activities and travel with less scrutiny. Concerns exist that they could also be used to help facilitate terrorism. State faces a number of challenges to its passport fraud detection efforts, and these challenges make it more difficult to protect U.S. citizens from terrorists, criminals, and others. Information on U.S. citizens listed in the federal government's consolidated terrorist watch list is not systematically provided to State. Moreover, State does not routinely obtain from the Federal Bureau of Investigation (FBI) the names of other individuals wanted by federal and state law enforcement authorities. We tested the names of 67 federal and state fugitives and found that 37, over half, were not in State's Consular Lookout and Support System (CLASS) database for passports. One of those not included was on the FBI's Ten Most Wanted list. State does not maintain a centralized and up-to-date fraud prevention library, hindering information sharing within State. Fraud prevention staffing reductions and interoffice workload transfers resulted in fewer fraud referrals at some offices, and insufficient training, oversight, and investigative resources also hinder fraud detection efforts. Any effect that new passport examiner performance standards may have on State's fraud detection efforts is unclear because State continues to adjust the standards. State began implementing the new standards in January 2004 to make work processes and performance expectations more uniform nationwide. Passport examiner union representatives expressed concern that new numerical production quotas may require examiners to "shortcut" fraud detection efforts. However, in response to union and examiner concerns, State eased the production standards during 2004 and made a number of other modifications and compromises.