[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4399 Introduced in House (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:

``113A. Telemarketing fraud.................................       2325
``113B. Terrorism...........................................    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.

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