US Government Outsources Electronic Passports

Washington Times reporter Bill Gertz is reporting that the US Government’s Printing Office is outsourcing the production of its electronic passports to overseas companies, including one Thailand company that was the victim of Chinese espionage efforts.

The outsourcing of passports raises concerns that the government is putting cost savings ahead of national security.

The Government Printing Office’s decision to outsource the work has proved profitable, allowing the agency to earn more than $100 million in recent profits by charging the State Department more money for blank passports than it actually costs to make them.

US lawmakers said they are concerned by these findings and plan to investigate why U.S. companies weren’t used to produce the state-of-the-art passports, one of the cornerstones of American border and national security.

GPO officials as well as the Homeland Security and the State Departments played down security concerns, saying they are confident that timely audits and other protections in place will stop terrorists and foreign spies from stealing the sensitive information to make fake passports.

However, GPO Inspector General J. Anthony Ogden doesn’t share that confidence. He warned in an internal Oct. 12 report that there are “significant deficiencies with the manufacturing of blank passports, security of components, and the internal controls for the process.”

The electronic passports contain a small computer chip inside the back cover that contains the passport number, photo and other personal information of the holder.

The Netherlands-based company that assembles the U.S. electronic passport covers in Thailand, Smartrac Technology Ltd., warned in its latest annual report that, in a worst-case scenario, social unrest in Thailand could lead to a halt in passport production.

Smartrac divulged in an October 2007 court filing in The Hague that China had stolen its patented technology for e-passport chips, raising additional questions about the security of the US passports.

Stolen blank electronic passports are the most problematic because they are the hardest to detect with current security procedures.

The GPO plans to produce 28 million blank passports this year up from about 9 million five years ago.