The Trump administration says it has a plan to expand eCBSV access

The Social Security Administration’s (SSA) Electronic Consent-Based Social Security Number Verification (eCBSV) service is undergoing a makeover by the Trump administration to drive down the cost of using the system and to encourage wider use.

Established by the Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018, the initiative was launched in June 2020 with the goal of combating synthetic identity fraud. Despite its potential as a tool for preventing fraud, eCBSV has been underutilized, which has limited its effectiveness as a frontline defense against financial crimes. The system enables banks, financial institutions, and other private-sector entities to swiftly detect identity fraud and prevent fraudulent financial transactions using stolen identities.

One of the big factors that has contributed to the program’s low use is its high operational costs and fee structure. By the end of fiscal year 2023, SSA had spent $62 million on the service, but had recovered only about $25 million through user fees. To address the revenue shortfall, SSA increased fees for the service in July 2023.

However, rather than encouraging participation, the fee hike led to decreased enrollment by financial institutions. Industry stakeholders warned that rising costs could push the program into a “death spiral,” with the higher fees driving away users and leading to further fee increases to cover costs.

At a hearing in May 2023 by the House Committee on Ways and Means Subcommittee on Social Security, witnesses warned of the dangers of the then Biden administration’s plan to raise the fee for participation in eCBSV, which, it was argued, would undermine SSA’s efforts to combat waste, fraud, and abuse and put SSA at risk of failing to recover up to $38 million in costs related to the development and operation of the system which were paid out of the Social Security Trust Funds.

In response to calls from the Ways and Means Committee urging SSA to enhance its management of eCBSV, the Trump administration has introduced measures to make the eCBSV system more accessible and effective. The newly announced plan is focused on addressing previous concerns about high user fees, limited participation, and bureaucratic inefficiencies that have hindered the system’s widespread adoption while also improving the quality of the data available to participants.

“President Trump has prioritized the protection of Social Security while tackling waste, fraud, and abuse across the federal government,” Ways and Means Committee Chairman Jason Smith said this week. “This step by the Social Security Administration ensures that fewer Americans will fall victim to identity theft. For years, the Ways and Means Committee has raised concerns about the risks posed to Social Security beneficiaries by fraud and has urged the Social Security Administration to fully utilize the eCBSV system.”

“This common-sense move will better safeguard the integrity of the Social Security program, protect beneficiaries, and secure the personal information of the American people,” Smith said.

The administration says its plan will cut the cost of implementing eCBSV by approximately 40 percent, and that the fee structure will be revised to encourage broader participation from stakeholders while maintaining the program’s cost recovery objectives.

Previously, SSA sought to recover all eCBSV development and operational costs within a three-year period, which led to high per-transaction fees that disincentivized broad adoption. The Trump administration revised this approach by extending the cost-recovery period to allow for lower, more predictable fees over a longer timeframe. The change aims to encourage greater adoption among financial institutions and lenders who rely on real-time SSN verification to detect and prevent synthetic identity fraud.

The previous administration’s pricing model had discouraged small and mid-sized financial firms from participating, resulting in underutilization of the system.

The adjustments were informed by a September 2024 Government Accountability Office study that was requested by Smith, former subcommittee Chairman Drew Ferguson, Senate Committee on Finance Chairman Mike Crapo, and Tim Scott, chairman of the Senate Chairman on Banking.

Because of the low rate of industry participation, many financial institutions had opted not to enroll due to the high fees and the service’s perceived inefficiencies. SSA officials had acknowledged the problem, but until recently hadn’t taken significant steps to expand participation, raising further concerns about the program’s long-term sustainability.

The system’s verification results have also been a source of frustration for financial institutions attempting to use eCBSV. The service provides a simple “Yes” or “No” response when verifying an individual’s Social Security Number. However, a “No” response lacks any detailed explanation, making it difficult for users to determine whether the issue stems from fraudulent activity, a typographical error, or a common name change due to marriage. This ambiguity has made it challenging for institutions to distinguish between legitimate verification issues and actual fraud attempts.

By reducing operational expenses by up to 40 percent, SSA said it will be able to lower annual fees for participating entities by approximately 25 percent. The reduction is expected to make the service more accessible and encourage broader adoption among financial institutions. Meanwhile, SSA is working on improving the system’s feedback mechanism by providing more detailed information when a verification request results in a mismatch. SSA said the enhancement is designed to help users better understand and resolve verification issues.

Despite the planned improvements, though, the long-term success of eCBSV remains uncertain. While SSA’s efforts to lower fees, enhance result clarity, and increase stakeholder collaboration represent a step in the right direction, the effectiveness of the measures will depend on how successfully they are implemented and whether financial institutions respond positively to the changes.

If SSA can effectively execute the reforms, eCBSV could finally fulfill its intended role as a critical tool in combating synthetic identity fraud. However, without sustained improvements and industry buy-in, the program will still risk continuing to fall short of its original purpose.

The changes coincide with the SSA’s transition toward digital authentication via Login.gov and ID.me, which has seen more than five million users migrate to Login.gov. Although it is a critical tool in the U.S. government’s ongoing efforts to combat fraud and streamline digital identity verification, its future could be on shaky ground, as Biometric Update reported this month.

This month SSA implemented new measures that require individuals who are unable to verify their identity online to visit field offices in person for certain services, including updating direct deposit information. Critics argue that in-person verification disproportionately affects elderly individuals, people with disabilities, and those in rural areas with limited access to SSA field offices.

Despite the Trump administration’s policy shifts, SSA’s broader approach to identity verification has sparked controversy, and the administration’s push toward in-person identity verification has been met with significant opposition from consumer advocacy groups, lawmakers, and SSA employees.

The backlash against in-person verification has been further compounded by SSA’s simultaneous closure of field offices. Elon Musk’s Department of Government Efficiency (DOGE) has begun shuttering offices nationwide, citing cost-cutting measures. Acting SSA Commissioner Leland Dudek has attempted to downplay the impact of the closures by saying that many of the offices being closed are small remote hearing sites with minimal public interaction.

Internal SSA estimates obtained by CNN indicate that the new verification requirements will increase in-person visits by 75,000 to 85,000 per week. Combined with office closures and ongoing staffing shortages, the surge of in-person visits is expected to cause severe delays and service disruptions.

Meanwhile, labor unions and privacy advocates have filed lawsuits challenging DOGE’s access to SSA’s internal databases, arguing that DOGE has illegally obtained and stored sensitive SSA records. Critics fear that centralizing SSA’s data under DOGE’s oversight could increase cybersecurity risks and lead to potential misuse of personal information.

Amid the upheaval, SSA has also sought to integrate additional fraud prevention technologies like the Department of Treasury Bureau of the Fiscal Service’s Account Verification Service (AVS), which provides real-time bank verification to detect and prevent fraudulent direct deposit changes. By combining AVS with eCBSV, SSA hopes to strengthen its defenses against identity fraud. However, concerns about DOGE’s activities within the Treasury Department though has cast doubt on the administration’s ability to effectively implement the measures.

While the Trump administration’s decision to lower fees may encourage greater adoption of eCBSV, skepticism remains over whether the measures will be enough to achieve full cost recovery by 2027. If eCBSV continues to struggle with participation, SSA may face still further pressure to reduce fees or to seek alternative funding mechanisms to sustain the program.

Article Topics

DOGE  |  eCBSV  |  fraud prevention  |  identity verification  |  social security  |  synthetic identity fraud  |  U.S. Government