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                                                      Calendar No. 418
116th Congress     }                                    {       Report
                                 SENATE
 2d Session        }                                    {      116-215

======================================================================



 
                  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.
---------------------------------------------------------------------------
    \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).
---------------------------------------------------------------------------
    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.

                                  [all]