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Calendar No. 418
116th Congress } { Report
SENATE
2d Session } { 116-215
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SENIORS FRAUD PREVENTION ACT OF 2019
_______
February 11, 2020.--Ordered to be printed
_______
Mr. Wicker, from the Committee on Commerce, Science, and
Transportation, submitted the following
R E P O R T
[To accompany S. 512]
[Including cost estimate of the Congressional Budget Office]
The Committee on Commerce, Science, and Transportation, to
which was referred the bill (S. 512) to establish an advisory
office within the Bureau of Consumer Protection of the Federal
Trade Commission to prevent fraud targeting seniors, and for
other purposes, having considered the same, reports favorably
thereon without amendment and recommends that the bill do pass.
Purpose of the Bill
The purpose of S. 512, the Seniors Fraud Prevention Act of
2019, is to establish an advisory office within the Bureau of
Consumer Protection of the Federal Trade Commission (FTC or
Commission) to advise the Commission on the prevention of fraud
targeting seniors by monitoring the market for specific fraud
schemes aimed at seniors and coordinating with other agencies
to provide consumer education materials to seniors and their
caregivers. The bill also would require the FTC to work with
the United States Attorney General to establish procedures to
log complaints regarding fraud targeting seniors.
Background and Needs
Seniors, specifically Americans aged 65 years and older,
number over 43 million and are the fastest growing segment of
the population.\1\ While older Americans are not necessarily
victimized by fraud at higher rates than younger consumers,\2\
their relative net worth makes them attractive targets to
fraudsters.\3\ Fraud directed toward seniors ranges from
Medicare medical device fraud\4\ to ``grandparents schemes,''
in which fraudsters call a senior and pretend to be a
grandchild in need of wired prison bail,\5\ to imposter schemes
that claim to provide technical support to remedy non-existent
computer problems.\6\ Reports measuring the financial cost of
fraud targeting seniors put the figure at a range between $2.9
billion\7\ to $12.76 billion\8\ annually.
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\1\The U.S. Census Bureau projects the senior population will be
83.7 million in 2050, almost double the estimated senior population in
2012. The Bureau also estimates that, by 2030, 20 percent of the U.S.
population will be over age 65, compared to 13 percent in 2010 and 9.8
percent in 1970. Ortman, Jennifer; Velkoff, Victoria; Hogan, Howard.
``An Aging Nation: The Older Population in the United States.'' U.S.
Census Bureau, U.S. Department of Commerce, May 2014, p. 1-3 (https://
www.census.gov/prod/2014pubs/p25-1140.pdf).
\2\The FTC's third consumer fraud survey found that the overall
victimization rate for seniors was significantly lower than for younger
consumers. Anderson, Keith B. ``Consumer Fraud in the U.S., 2011: The
Third FTC Survey.'' Bureau of Economics, Federal Trade Commission, Apr.
2013, p. 56-59 (https://www.ftc.gov/reports/consumer-fraud-united-
states-2011-third-ftc-survey).
\3\In 2011, the net worth for households headed by seniors was
approximately $17.2 trillion, with a median net worth of $170,500.
``Mean Value of Assets for Households by Type of Asset Owned and
Selected Characteristics: 2011.'' U.S. Census Bureau, U.S. Department
of Commerce, 2011, Table 5 (https://www2.census.gov/programs-surveys/
demo/tables/wealth/2011/wealth-asset-ownership/wealth-tables-
2011.xlsx).
\4\AARP, ``Medical Equipment Scams'' (https://www.aarp.org/money/
scams-fraud/info-2019/medical-equipment.html) (accessed Dec. 12, 2019).
\5\Tamara Lytle, ``Give Gift Cards to Friends and Family--Not
Fraudsters,'' AARP, November 7, 2019 (https://www.aarp.org/money/scams-
fraud/info-2019/prevent-gift-card-fraud.html) (accessed Dec. 12, 2019).
\6\Id.
\7\``MetLife Study of Elder Financial Abuse, Crimes of Occasion,
Desperation, and Predation Against America's Elders.'' The MetLife
Mature Market Institute, Jun. 2011 (https://ltcombudsman.org/uploads/
files/issues/mmi-elder-financial-abuse.pdf).
\8\``TrueLink Report on Elder Financial Abuse 2015.'' True Link
Financial, Jan. 2015 (http://documents.truelinkfinancial.com/True-Link-
Report-On-Elder-Financial-Abuse-012815.pdf).
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The FTC, a civil enforcement agency, takes a multifaceted
approach to combating fraud that includes both enforcement and
education efforts. In the past few years, the FTC has brought
cases against fraudsters targeting seniors. One telemarketing
scam attempted to get seniors to divulge personal information
by claiming to be part of Medicare.\9\ The scammers used this
information to debit $399 or $448 from each of the victims'
bank accounts.\10\ In another case, fraudsters used robocalls
to tell seniors that a friend or family member had purchased a
medical alert system for them and that monthly monitoring fees
would only be charged once the system was installed and
activated, but instead began charging them immediately.\11\
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\9\``FTC v. Sun Bright Ventures LLC, No. 140CV-02153-JDW-EAJ.''
Oct. 2, 2014 (https://www.ftc.gov/enforcement/cases-proceedings/132-
3217/sun-bright-ventures-llc-gmy-llc).
\10\Id.
\11\``FTC v. Worldwide Information Services, Inc., No. 6:14-CV-8-
ORC-28DAB.'' Jan. 13, 2014 (https://www.ftc.gov/enforcement/cases-
proceedings/132-3175/worldwide-info-services-inc).
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In addition to these enforcement actions, the FTC has
developed a consumer education campaign called Pass It On,
which targets active, older adults. The goal of Pass It On is
to educate seniors about common fraud schemes so they can pass
on this information to their respective communities.\12\ The
FTC also partners with organizations, such as the AARP, to
provide education and counseling to seniors that have been
affected by fraud. Through this program, the FTC refers
consumers over the age of 60 that have called the FTC's
Consumer Response Center with complaints about fraud to peer
counselors that provide support to those that have been
targeted.
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\12\``Pass It On.'' Federal Trade Commission (https://www.ftc.gov/
PassItOn). (Materials are free and in the public domain and hard copies
may be requested from https://www.ftc.gov/bulkorder.)
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The Commission also participates in the Elder Justice
Coordinating Council (Council), an organization composed of 12
Federal agencies, which meets regularly to coordinate
activities related to elder abuse, neglect, and
exploitation.\13\ Every 2 years, the Council provides a report
to Congress with recommendations on how best to address these
abuses. The Council's most recent report contained eight
recommendations for increased Federal involvement in addressing
these issues, including a recommendation that agencies develop
public awareness campaigns to assist in preventing all types of
elder abuse, including fraud targeting older Americans.\14\
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\13\The Elder Justice Coordinating Council is chaired by the
Department of Health and Human Services and its membership includes the
Consumer Financial Protection Bureau, the Corporation for National and
Community Service, the Department of Housing and Urban Development, the
Department of Justice, the Department of Labor, the Department of
Transportation, the Veterans Administration, the FTC, the Securities
and Exchange Commission, the Social Security Administration, and the
U.S. Postal Inspection Service.
\14\``Eight (8) Recommendations for Increased Federal Involvement
in Addressing Elder Abuse, Neglect, and Exploitation.'' Elder Justice
Coordinating Council, U.S. Department of Health & Human Services, May
2014 (http://www.acl.gov/sites/default/files/programs/2016-09/
Eight_Recommendations_for_Increased_Federal_Involvement.pdf).
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To address these issues, S. 512 would establish a permanent
advisory office within the FTC's Bureau of Consumer Protection
to streamline efforts to prevent fraud targeting seniors. This
bill also would facilitate coordination between various Federal
agencies with jurisdiction over fraud to ensure consumer
education efforts are effective, contain accurate information,
and are consistent across the relevant agencies.
Summary of Provisions
S. 512 directs the FTC to establish an office within the
Bureau of Consumer Protection to advise the FTC on monitoring
for and preventing mail, internet, telemarketing, or robocall
fraud targeting seniors. The office would be required to
disseminate to seniors and their families and caregivers
information on common fraud schemes, respond to requests from
members of the public for information regarding FTC enforcement
actions relating to particular entities or individuals, and
maintain a website with relevant information on senior fraud.
Legislative History
S. 512 was introduced on February 14, 2019, by Senator
Klobuchar (for herself and Senator Collins) and was referred to
the Committee on Commerce, Science, and Transportation of the
Senate. Senators Van Hollen, King, Gillibrand, Shaheen, Sinema,
Hassan, Casey, Merkley, Baldwin, Blumenthal, McSally, and
Tester are additional cosponsors. On April 3, 2019, the
Committee met in open Executive Session and, by voice vote,
ordered S. 512 reported favorably without amendment.
Estimated Costs
In accordance with paragraph 11(a) of rule XXVI of the
Standing Rules of the Senate and section 403 of the
Congressional Budget Act of 1974, the Committee provides the
following cost estimate, prepared by the Congressional Budget
Office:
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
S. 512 would establish an office within the Federal Trade
Commission's (FTC) Bureau of Consumer Protection to advise the
agency on preventing fraud targeting senior citizens. This
office would monitor fraud targeting seniors delivered via
mail, television, internet, telemarketing, and robocalls. In
addition, it would educate senior consumers by distributing
information and consumer resources, respond to reports of
suspected fraudulent entities, and maintain a public website of
fraudulent actions. Finally, the office would log and
acknowledge complaints from fraud victims, and make those
complaints available to law enforcement authorities.
According to the FTC, the Bureau of Consumer Protection is
already fulfilling many of the bill's requirements because it
actively works to monitor and prevent consumer fraud
perpetrated against senior citizens. Furthermore, the Elder
Abuse Prevention and Prosecution Act requires the FTC to
designate an Elder Justice Coordinator within the bureau who is
responsible for coordinating elder justice issues. On that
basis, CBO estimates that the cost associated with implementing
the bill would be less than $500,000.
The CBO staff contact for this estimate is David Hughes.
The estimate was reviewed by H. Samuel Papenfuss, Deputy
Assistant Director for Budget Analysis.
Regulatory Impact Statement
Because S. 512 does not create any new programs, the
legislation will have no additional regulatory impact, and will
result in no additional reporting requirements. The legislation
will have no further effect on the number or types of
individuals and businesses regulated, the economic impact of
such regulation, the personal privacy of affected individuals,
or the paperwork required from such individuals and businesses.
Congressionally Directed Spending
In compliance with paragraph 4(b) of rule XLIV of the
Standing Rules of the Senate, the Committee provides that no
provisions contained in the bill, as reported, meet the
definition of congressionally directed spending items under the
rule.
Section-by-Section Analysis
Section 1. Short title.
This section would provide that the bill may be cited as
the ``Seniors Fraud Prevention Act of 2019''.
Section 2. Office for the prevention of fraud targeting seniors.
This section would establish an advisory office within the
FTC's Bureau of Consumer Protection that would advise the
Commission on the prevention of fraud targeting seniors.
The advisory office would be tasked with monitoring the
market for mail, television, internet, and robocall fraud
targeting seniors.
The advisory office also would consult with the Attorney
General, the Secretary of Health and Human Services, the
Postmaster General, the Chief Postal Inspector for the United
States Postal Inspection Service, and other relevant agencies
to undertake efforts to educate consumers, including seniors,
their families, and their caregivers, about fraud targeting
older Americans. This consumer outreach program would provide
information about the most common senior fraud schemes, as well
as information on how to report senior fraud through the
national toll-free number or through the FTC's Consumer
Sentinel Network.
This section would require the Commission, in response to a
specific request, to provide publicly available information
about any enforcement actions it has taken against any
particular individual or entity. The advisory office also would
maintain a website providing information regarding the various
types of fraud targeting seniors.
This section also would require the Commission, through the
advisory office, and in consultation with the Attorney General,
to establish procedures to log and acknowledge complaints from
individuals who believe they have been victims of mail,
television, internet, telemarketing, or robocall fraud in the
Consumer Sentinel Network. These complaints would be made
immediately available to Federal, State, and local law
enforcement authorities. In so doing, the Commission, acting
through the advisory office, would be required to consult with
the Attorney General to provide specific and general
information on fraud schemes to individuals and law enforcement
agencies.
This section would clarify, however, that the Commission,
through the advisory office, may implement the consumer
education program and complaint procedures described in this
section without the approval of the officials and agencies with
which it is required to consult.
The Commission would have 1 year after the date of
enactment to commence carrying out the bill's requirements.
Changes in Existing Law
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, the Committee states that the
bill as reported would make no change to existing law.
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