Terry Jeffrey

There is a scandal unfolding in corporate America that President Bush needs to stop, given that fixing Social Security is his top domestic goal and securing the nation against terrorism is his greatest duty.

 The scandal is happening precisely where Social Security and national security intersect.

 The question it raises: Is the administration tolerating an increased risk of terrorism because it doesn't want to stop big businesses from hiring illegal aliens?

 Key facts of this scandal were revealed in an October report from the Inspector General of the Social Security Administration (SSA). The report examines the records of the 100 companies that filed the most W-2 reports from 1997-2001 on which the names and/or Social Security Numbers did not match SSA records and that SSA -- even after some investigation -- could not credit to a known taxpayer.

 SSA consigns these orphaned W-2s to what it calls the Earnings Suspense File (ESF). The "Top 100" worst filers of W-2s that ended up in the ESF, the inspector general discovered, collectively filed more than 2.7 million of these bad W-2s over the five years studied, reporting about $9.6 billion in wages that could not be matched to a worker.

 The report does not name these "Top 100" companies. But it provides some details about them. For, example:

 -- The No. 1 corporate filer of orphaned W-2s is based in Illinois. From 1997-2001, it filed 131,991 of these W-2s, reporting $524,933,538 in wages that the government could not credit to a known taxpayer.

 -- A Texas company was No. 2. It filed 108,302 orphaned W-2s over five years, reporting $532,964,026 in wages paid to unknown workers.

 -- The problem got worse. "Our review of the Top 100 employer data also found that the average increase in suspended wage items between tax years 1997 and 2001 was approximately 69 percent," said the report.

 Now, this is an obvious scandal for Social Security. Workers with higher reported wages get bigger benefit checks in retirement. But as long as the $9.6 billion in wages reported by the "Top 100" companies on bad W-2s remains unmatched to any taxpayer, the taxpayers who earned those wages and paid taxes on them may be denied their full Social Security benefits.

 These workers -- provided they were legally entitled to work in the United States -- are getting ripped off.

 Even if national security were not involved, that alone should cause President Bush to act.

Terry Jeffrey

Terence P. Jeffrey is the editor-in-chief of CNSNews

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