H.R. 4399 (103rd): Senior Citizens Against Marketing Scams Act of 1994

103rd Congress, 1993–1994. Text as of May 12, 1994 (Introduced).

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HR 4399 IH

103d CONGRESS

2d Session

H. R. 4399

To combat telemarketing fraud.

IN THE HOUSE OF REPRESENTATIVES

May 12, 1994

Mr. CARR of Michigan introduced the following bill; which was referred to the Committee on the Judiciary


A BILL

To combat telemarketing fraud.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ‘Senior Citizens Against Marketing Scams Act of 1994’.

SEC. 2. ENHANCED PENALTIES FOR TELEMARKETING FRAUD.

    (a) OFFENSE- Part I of title 18, United States Code, is amended--

      (1) by redesignating chapter 113A as chapter 113B; and

      (2) by inserting after chapter 113 the following new chapter:

‘CHAPTER 113A--TELEMARKETING FRAUD

‘Sec.

      ‘2325. Definition.

      ‘2326. Enhanced penalties.

      ‘2327. Restitution.

‘Sec. 2325. Definition

    ‘In this chapter, ‘telemarketing’--

      ‘(1) means a plan, program, promotion, or campaign that is conducted to induce--

        ‘(A) purchases of goods or services; or

        ‘(B) participation in a contest or sweepstakes,

      by use of 1 or more interstate telephone calls initiated either by a person who is conducting the plan, program, promotion, or campaign or by a prospective purchaser or contest or sweepstakes participant; but

      ‘(2) does not include the solicitation of sales through the mailing of a catalog that--

        ‘(A) contains a written description or illustration of the goods or services offered for sale;

        ‘(B) includes the business address of the seller;

        ‘(C) includes multiple pages of written material or illustration; and

        ‘(D) has been issued not less frequently than once a year,

      if the person making the solicitation does not solicit customers by telephone but only receives calls initiated by customers in response to the catalog and during those calls take orders without further solicitation.

‘Sec. 2326. Enhanced penalties

    ‘An offender that is convicted of an offense under 1028, 1029, 1341, 1342, 1343, or 1344 in connection with the conduct of telemarketing--

      ‘(1) may be imprisoned for a term of 5 years in addition to any term of imprisonment imposed under any of those sections, respectively; and

      ‘(2) in the case of an offense under any of those sections that--

        ‘(A) victimized a significant number of persons over the age of 55; or

        ‘(B) targeted persons over the age of 55,

      may be imprisoned for a term of 10 years in addition to any term of imprisonment imposed under any of those sections, respectively.

‘Sec. 2327. Restitution

    ‘In sentencing an offender under section 2326, the court shall order the offender to pay restitution to any victims and may order the offender to pay restitution to others who sustained losses as a result of the offender’s fraudulent activity.’.

    (b) CLERICAL AMENDMENTS- The table of chapters at the beginning of part I of title 18, United States Code, is amended by striking the item relating to chapter 113A and inserting the following:

2325

2331’.

SEC. 3. FORFEITURE OF FRAUD PROCEEDS.

    Section 982(a) of title 18, United States Code, is amended by adding at the end the following new paragraph:

      ‘(6) The Court, in sentencing an offender under section 2326, shall order that the offender forfeit to the United States any real or personal property constituting or derived from proceeds that the offender obtained directly or indirectly as a result of the offense.’.

SEC. 4. INCREASED PENALTIES FOR FRAUD AGAINST OLDER VICTIMS.

    (a) REVIEW- The United States Sentencing Commission shall review and, if necessary, amend the sentencing guidelines to ensure that victim related adjustments for fraud offenses against older victims over the age of 55 are adequate.

    (b) REPORT- Not later than 180 days after the date of enactment of this Act, the Sentencing Commission shall report to Congress the result of its review under subsection (a).

SEC. 5. REWARDS FOR INFORMATION LEADING TO PROSECUTION AND CONVICTION.

    Section 3059 of title 18, United States Code, is amended by adding at the end the following new subsection:

    ‘(c)(1) In special circumstances and in the Attorney General’s sole discretion, the Attorney General may make a payment of up to $10,000 to a person who furnishes information unknown to the Government relating to a possible prosecution under section 2325 which results in a conviction.

    ‘(2) A person is not eligible for a payment under paragraph (1) if--

      ‘(A) the person is a current or former officer or employee of a Federal, State, or local government agency or instrumentality who furnishes information discovered or gathered in the course of government employment;

      ‘(B) the person knowingly participated in the offense;

      ‘(C) the information furnished by the person consists of an allegation or transaction that has been disclosed to the public--

        ‘(i) in a criminal, civil, or administrative proceeding;

        ‘(ii) in a congressional, administrative, or General Accounting Office report, hearing, audit, or investigation; or

        ‘(iii) by the news media, unless the person is the original source of the information; or

      ‘(D) when, in the judgment of the Attorney General, it appears that a person whose illegal activities are being prosecuted or investigated could benefit from the award.

    ‘(3) For the purposes of paragraph (2)(C)(iii), the term ‘original source’ means a person who has direct and independent knowledge of the information that is furnished and has voluntarily provided the information to the Government prior to disclosure by the news media.

    ‘(4) Neither the failure of the Attorney General to authorize a payment under paragraph (1) nor the amount authorized shall be subject to judicial review.’.

SEC. 6. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated for fiscal year 1995 for the purposes of carrying out this Act and the amendments made by this Act--

      (1) $10,000,000 for the Federal Bureau of Investigation to hire, equip, and train no fewer than 100 special agents and support staff to investigate telemarketing fraud cases;

      (2) $3,500,000 to hire, equip, and train no fewer than 30 Department of Justice attorneys, assistant United States Attorneys, and support staff to prosecute telemarketing fraud cases; and

      (3) $10,000,000 for the Department of Justice to conduct, in cooperation with State and local law enforcement agencies and senior citizen advocacy organizations, public awareness and prevention initiatives for senior citizens, such as seminars and training.

SEC. 7. BROADENING APPLICATION OF MAIL FRAUD STATUTE.

    Section 1341 of title 18, United States Code, is amended--

      (1) by inserting ‘or deposits or causes to be deposited any matter or thing whatever to be sent or delivered by any private or commercial interstate carrier,’ after ‘Postal Service,’; and

      (2) by inserting ‘or such carrier’ after ‘causes to be delivered by mail’.

SEC. 8. FRAUD AND RELATED ACTIVITY IN CONNECTION WITH ACCESS DEVICES.

    Section 1029 of title 18, United States Code, is amended--

      (1) in subsection (a)--

        (A) by striking ‘or’ at the end of paragraph (3); and

        (B) by inserting after paragraph (4) the following new paragraphs:

      ‘(5) knowingly and with intent to defraud effects transactions, with 1 or more access devices issued to another person or persons, to receive payment or any other thing of value during any 1-year period the aggregate value of which is equal to or greater than $1,000;

      ‘(6) without the authorization of the issuer of the access device, knowingly and with intent to defraud solicits a person for the purpose of--

        ‘(A) offering an access device; or

        ‘(B) selling information regarding or an application to obtain an access device; or

      ‘(7) without the authorization of the credit card system member or its agent, knowingly and with intent to defraud causes or arranges for another person to present to the member or its agent, for payment, 1 or more evidences or records of transactions made by an access device;’;

      (2) in subsection (c)(1) by striking ‘(a)(2) or (a)(3)’ and inserting ‘(a) (2), (3), (5), (6), or (7)’; and

      (3) in subsection (e)--

        (A) by striking ‘and’ at the end of paragraph (5);

        (B) by striking the period at the end of paragraph (6) and inserting ‘; and’; and

        (C) by adding at the end the following new paragraph:

      ‘(7) the term ‘credit card system member’ means a financial institution or other entity that is a member of a credit card system, including an entity, whether affiliated with or identical to the credit card issuer, that is the sole member of a credit card system.’.

SEC. 9. INFORMATION NETWORK.

    (a) HOTLINE- The Attorney General shall establish a national toll-free hotline for the purpose of--

      (1) providing general information on telemarketing fraud to interested persons; and

      (2) gathering information related to possible violations of this Act.

    (b) ACTION ON INFORMATION GATHERED- The Attorney General shall work in cooperation with the Federal Trade Commission to ensure that information gathered through the hotline shall be acted on in an appropriate manner.