Investigate Employer Who Filed 37,375 Bad W-2s in One Year

Terence P. Jeffrey, CNS News, April 24, 2013

I have a challenge for members of Congress now vowing that the federal government will enforce the immigration laws in the future if we just let them take the illegal aliens in the United States today and put them on a “pathway to citizenship.”

It is this: Investigate the employer who—according to the Office of the Inspector General of the Social Security Administration (SSA)—filed 37,375 inaccurate W-2s in tax year 2005. In fact, investigate all employers who have similarly filed massive numbers of bad W-2s.

Forget the employers who filed 100, 200 or even 500 bad W-2s per year. Give them a pass—for now. Focus only on those that filed thousands.

Make them sit publicly in congressional hearings and explain how and why they filed so many bad documents with the IRS. Make them as famous as they deserve to be.

When you are done with that, bring in any administration official who wants to defend these employers—or the workers who provided these employers with false Social Security Numbers when they took the jobs for which the bad W-2s were filed.

The truth: Our government is willfully refusing to enforce the immigration laws not only at the border but also in the workplace.

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As I reported before in this column, the SSA inspector general on Dec. 15, 2008, published an analysis of “no-match” W-2s. These are W-2s on which the name and the Social Security Number do not match and SSA cannot readily determine the true identity of the worker for whom it was filed. SSA dumps these into what it calls the “Earnings Suspense File” (ESF).

In this 2008 report, the inspector general looked at the W-2s SSA dropped into the ESF for tax year 2005.

He discovered that 10.1 million no-match W-2s were filed that year, and 871,000 employers filed at least one. But an elite group—1,650 employers—filed 500 or more. “These employers had reported no-matches that ranged from 501 to 37,375,” said the IG, “and about 44 percent of the employers had reported … 1,000 or more no-matches to SSA.”

So, who was the employer that filed 37,375? In the IG’s report, this employer is anonymous.

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On Oct. 26, 2004, the SSA IG published a report on the Top 100 employers who filed the most no-match W-2s from 1997 to 2001. The IG discovered unmistakable patterns.

“Forty-three of the Top 100 employers were in the service industry, 32 were in the restaurant industry, and 20 employers were in the agriculture industry,” said the IG. “Four of the remaining employers were in the hotel/retail industry, and one was a State agency.”

Yes, a “State agency” was one of the Top 100 filers of no-match W-2s with SSA. Which state? Again, it is anonymous.

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For more than a decade, the federal government has suspected that employers who file large numbers of no-match W-2s may be knowingly hiring illegal aliens.

“SSA suspects that employers in certain high turnover industries (bars and restaurants, services, and agriculture) compound the problem because they may knowingly hire illegal aliens with fraudulent identification and are able to do so because there are no penalties imposed for their actions,” said an SSA IG report published on Feb. 7, 2000. “Consequently, those employers who knowingly accept fraudulent documentation are free to conduct business as usual without regard to the disruption and harm caused to SSA’s customers and to unknowing individuals whose identities are falsely used.”

During President Bush’s second term, the Department of Homeland Security proposed a regulation to require employers who received letters from SSA indicating they had no-match W-2s to double-check their records and clarify their accuracy with their workers if they did not want those no-match W-2s to be considered evidence of knowingly hiring unauthorized workers. The AFL-CIO and others sued over the proposal, a judge issued a preliminary injunction against it, and the Obama administration dropped it.

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