E-signatures navigate troubled waters

Electronic signatures have often been touted as a cornerstone of e-government, providing the legal underpinnings needed to do away with paper and move transactions online.

So far, however, e-signatures have failed to deliver on their promise. Although many agencies have launched initiatives, they have been hindered by a number of obstacles, including competing e-signature standards and a lack of interest and understanding by citizens.

Federal agencies that have jumped on the e-government bandwagon have contrived a variety of ways for getting signatures on electronic forms. For instance, the Education Department and the Internal Revenue Service have been using e-signatures for several years, each following its own distinctive processes.

Neither agency, though, is doing anything like the Social Security Administration. SSA officials plan to automate their benefits claims-processing procedures by next year, and they refuse to be held back by old-fashioned "wet signatures." That effort, like many others, has been complicated by the agency's large constituency and many citizens' limited access to and skill with computers.

So, SSA officials are offering a different option: an e-signature proxy. Rather than applying for an e-signature, which typically involves setting up a personal identification number, citizens will be able to call or visit their local SSA offices. Agency representatives will attest to the applicants' intentions and apply the e-signatures for them.

On May 4, SSA's commissioner, Jo Anne Barnhart, announced a new ruling that expands the agency's use of attestation as an alternative to both traditional and witnessed signatures. The ruling authorizes employees to attest electronically to a citizen's decision to apply for benefits under any of the agency's entitlement programs.

After June 21, the agency will let citizens use a signature proxy when they apply for benefits on SSA's Web site. They can sign their applications by clicking a Sign Now button, which is another type of signature proxy, agency officials said.

To support signature proxies based on electronic attestation, agency officials have started making software changes in benefits applications, SSA spokeswoman Carolyn Cheezum said. Those changes will be completed by June 21. Agency officials also are preparing written instructions and a training video for all field office employees.

"As with any new process," Cheezum said, "SSA expects, in the short term, to experience a learning curve for both employees and the public as they become comfortable with the use of the signature proxy alternatives."

Signature proxies don't prove a person's identity, but their use will let the agency offer expanded e-government services to the public, she said.

SSA officials have concluded that for their constituents, many of whom are elderly and have disabilities, stronger forms of document and identity authentication, such as those based on public-key infrastructure technology, are unrealistic because of their complexity and cost.

Officials were careful in the official notice not to claim too much for their e-signatures policy. They said SSA rulings, such as the one permitting attestation for e-signatures, lack the force of a statute.

Nevertheless, the rulings apply agencywide, and the signature ruling will affect all SSA programs, including disability, retirement and survivors insurance as well as supplemental security income.

Initially, the agency will use attestation-based e-signatures when citizens apply for benefits by phone or in person at an SSA field office. But agency officials said they might later expand their use of e-signature proxies to other agency procedures, including requests for administrative appeals when claims for Social Security benefits are denied.

The new ruling is expected to contribute significantly to reducing the agency's traditional paper-handling, shipping and storage costs, Cheezum said. Using attestation in lieu of handwritten signatures will let SSA do away with storing signed paper applications. Only in exceptional instances willpaper applications be kept on file.

When citizens want to sign a completed paper application, SSA employees will tell them the agency no longer keeps

paper applications but that they can keep the signed application for their own records.

Like SSA, officials at Education and the IRS have devised procedures for citizens to sign documents electronically. "It's been the case for a long time that there are many different approaches," said Ari Schwartz, associate director of the Center for Democracy and Technology.

The same is true in the states and in the private sector, where few standards for digital signature technology exist. "It's not even clear there is a marketplace here," Schwartz said.

More than three years after the enactment of the Electronic Signatures in Global and National Commerce Act, Education has more than 3 million electronically signed loan documents, said Neil Sattler, manager of e-commerce services in the Office of Federal Student Aid.

Department officials issue electronic identity credentials called federal student aid PINs, or FSA PINs. The credentials are derived from information college students submit when they apply for federal financial aid.

From each application, the agency extracts certain pieces of personal information to create an FSA PIN. Students are directed to a secure Web site where they enter personal information to identify themselves and are then assigned a PIN.

Using that PIN as part of an e-signature process, students can gain access to certain agency systems and can electronically sign applications for student aid, promissory notes and loan consolidation, for example.

In the future, Sattler said, the agency might be able to accept the electronic identity credentials that banks and other e-commerce businesses are creating, but for now he is satisfied with Education's approach to e-signatures. "We are a credential provider, and the PIN is adequate for our business purposes today," he said.

The IRS also uses a combined PIN- and knowledge-based approach to e-signatures for taxpayers who file their returns electronically. The agency's self-select PIN method allows taxpayers to create their own e-signatures using any combination of five numbers, except all zeros. Tax software guides them through a process that eliminates the need for taxpayers to submit Form 8453, the U.S. Individual Income Tax Declaration for an IRS e-file Return.

For verification, the IRS asks e-filers for their dates of birth and adjusted gross income from the previous year's tax returns.

Although helpful, SSA's use of e-signatures is insufficient for verifying that people are who they claim to be. For that, Cheezum said, citizens must provide several pieces of personal information, including an original or certified copy of a birth certificate, which SSA employees can use to compare with information in the agency's databases.

But she said SSA will use internal databases and e-signature proxies to move as quickly as possible toward the goal of replacing paper folders with electronic ones so all aspects of processing Social Security benefits can be conducted online.

"The creation and retention of paper folders has become a huge burden to SSA," Cheezum said. "Signature proxy is a critical step toward eliminating that burden."