Oregon agency defense use of facial recognition tech but has alternatives |

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The Oregon Employment Department is defending its use of a contractor that relies on facial technology to verify the identities of people claiming benefits.

However, acting Employment Department Director David Gerstenfeld says the agency began use of alternatives to the technology last fall, when it found that some people faced special difficulties in the automated scanning system used by ID.me in Oregon and 26 other states, including four neighboring states.

The system compares photos uploaded by claim applicants against driver’s licenses, state identification cards, passports or passport cards, all of which have photos.

Among the groups Gerstenfeld said had difficulties:

• Workers ages 20 and younger

• Latinx, Black and Native American residents

• People who lacked access to computers

“We are aware of concerns about facial recognition technology and how it may be harder for people of color to use,” Gerstenfeld told reporters in a briefing Wednesday, Feb. 16. “We are also deeply committed to ensuring that the claimant identity verification process is equitable for everyone.”

Among the alternatives Gerstenfeld said the agency has instituted since problems were identified last fall: Recorded telephone messages in four languages, informing claimants there are alternatives to facial recognition; live calls from agency staff or interpreters in the claimants’ preferred language; a special help button on the agency’s “contact us” webpage, and in-person visits to WorkSource offices, where claimants can verify their identity or use special cell phones to upload their photos.

Of 27,000 claims for unemployment benefits since the agency started using the system, Gerstenfeld said 17,000 have completed the process through ID.me. He did not have a count of those who qualified after in-person visits to WorkSource offices, which are run by the agency and local partners.

He said others probably were deterred because they lacked verification and may have been seeking to obtain benefits fraudulently.

Wyden prods feds

Gerstenfeld spoke the day after Chairman Ron Wyden and two fellow Democrats on the Senate Finance Committee, Sherrod Brown of Ohio and Elizabeth Warren of Massachusetts, decried the use of facial recognition technology by private contractors working with state employment agencies.

The senators, in a Feb. 15 letter to Labor Secretary Marty Walsh, urged the Department of Labor to help states move to a federal alternative such as login.gov, run by the General Services Administration since 2017.

They wrote: “It is concerning that so many state and federal government agencies have outsourced their core technology infrastructure to the private sector. 

“It is particularly concerning that one of the most prominent vendors in the space, ID.me, not only uses facial recognition and lacks transparency about its processes and results, but frequently has unacceptably long wait times for users to be screened by humans after being rejected by the company’s automated scanning system.”

The federal system has enrolled 28 agencies with 200 websites and has 40 million Americans with accounts.

But three of the largest federal agencies do not use login.gov. They are the Internal Revenue Service, which processed 189 million tax returns in 2020; the Social Security Administration, which serves 69 million recipients, and the Department of Veterans Affairs.

Wyden, and the Republican members of the Finance Committee, made the same point in recent weeks about the IRS use of facial recognition technology. Unlike the Republicans, however, Wyden acknowledges that the IRS needs urgent modernization of its systems.

Gerstenfeld said Wyden’s point is well taken.

“We agree with Sen. Wyden that an ideal solution would be a national identity verification tool,” he said.

“We continue to see how we can make the process of verifying identity easier and preserve their confidentiality. We do think there are good safeguards in place. We would prefer it was a national system that all states can use. But there isn’t one right now that provides the same level of identity verification security.”

How it started

Gerstenfeld said Oregon contracted with ID.me, based in McLean, Virginia, for a pilot project in March.

“It was clear that existing tools did not provide adequate prevention” against fraudulent claims, he said, which stem from identity theft of individuals or organized thieves buying personal information on the black market.

In mid-January, Oregon reported a preliminary estimate of $24 million in losses from fraudulent claims for unemployment benefits during 2020. The amount was a fraction of the $7.4 billion that the Oregon Employment Department paid out in federal and state benefits, the latter drawn from the unemployment trust fund that comes from employer payroll taxes. It also was far less than the estimated $20 billion lost in California or the $640 million in Washington state.

According to the state report, 4,543 identity-theft cases accounted for $3.1 million in losses, and 4,692 individual-fraud cases accounted for $21.1 million. The agency is still working on data for 2021; most federal supplemental unemployment benefits ended on Labor Day.

The same report said most of the 2020 losses were in regular benefits from the state trust fund, not supplemental federal benefits.

“We think there are good safeguards in place. We would prefer a national system,” Gerstenfeld said.

“We’re not saying we are at a perfect state. We continue to work with the vendor, address the concerns, and try to understand the impacts we saw.” 

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