[Senate Hearing 115-175]
[From the U.S. Government Publishing Office]







                                                        S. Hrg. 115-175

                  STOPPING SENIOR SCAMS: DEVELOPMENTS
                  IN FINANCIAL FRAUD AFFECTING SENIORS

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

                                HEARING

                               BEFORE THE

                       SPECIAL COMMITTEE ON AGING

                          UNITED STATES SENATE

                     ONE HUNDRED FIFTEENTH CONGRESS


                             FIRST SESSION

                               __________

                             WASHINGTON, DC

                               __________

                           FEBRUARY 15, 2017

                               __________

                            Serial No. 115-1

         Printed for the use of the Special Committee on Aging



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]







         Available via the World Wide Web: http://www.fdsys.gov
         
         
         
                                     ______

                         U.S. GOVERNMENT PUBLISHING OFFICE 

26-817 PDF                     WASHINGTON : 2018 
-----------------------------------------------------------------------
  For sale by the Superintendent of Documents, U.S. Government Publishing 
  Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; 
         DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, 
                          Washington, DC 20402-0001
       
         
         
         
         
         
         
         
         
         
         
         
         
         
         
         
         
         
         
         
                       SPECIAL COMMITTEE ON AGING

                       SUSAN M. COLLINS, Chairman

ORRIN HATCH, Utah                    ROBERT P. CASEY JR, Pennsylvania
JEFF FLAKE, Arizona                  BILL NELSON, Florida
TIM SCOTT, South Carolina            SHELDON WHITEHOUSE, Rhode Island
THOM TILLIS, North Carolina          KIRSTEN E. GILLIBRAND, New York
BOB CORKER, Tennessee                RICHARD BLUMENTHAL, Connecticut
RICHARD BURR, North Carolina         JOE DONNELLY Indiana
MARCO RUBIO, Florida                 ELIZABETH WARREN, Massachusetts
DEB FISCHER, Nebraska                CATHERINE CORTEZ MASTO, Nevada
                              ----------                              
                 Kevin Kelley, Majority Staff Director
                  Kate Mevis, Minority Staff Director
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                                CONTENTS

                              ----------                              

                                                                   Page

Opening Statement of Chairman Susan M. Collins...................     1
    Prepared Statement...........................................    36
Statement of Ranking Member Robert P. Casey Jr...................     3
    Prepared Statement...........................................    37

                           PANEL OF WITNESSES

Phillip Hatch, IRS Impersonation Scam Victim, Portland, ME.......     6
Timothy P. Camus, Deputy Inspector General for Investigations, 
  Treasury Inspector General for Tax Administration, Washington, 
  DC.............................................................     7
Lois Greisman, Associate Director, Division of Marketing 
  Practices, Bureau of Consumer Protection, Federal Trade 
  Commission,Washington, DC......................................     9
Diane A. Menio, Executive Director, Center for Advocacy for the 
  Rights & Interests of the Elderly, Philadelphia, PA............    10

                                APPENDIX
                      Prepared Witness Statements

Phillip Hatch, IRS Impersonation Scam Victim, Portland, ME.......    38
Timothy P. Camus, Deputy Inspector General for Investigations, 
  Treasury Inspector General for Tax Administration, Washington, 
  DC.............................................................    39
Lois Greisman, Associate Director, Division of Marketing 
  Practices, Bureau of Consumer Protection, Federal Trade 
  Commission, Washington, DC.....................................    52
Diane A. Menio, Executive Director, Center for Advocacy for the 
  Rights & Interests of the Elderly, Philadelphia, PA............    74

                  Additional Statements for the Record

Endorsement letters submitted by Senator Collins.................    82
 
   STOPPING SENIOR SCAMS: DEVELOPMENTS IN FINANCIAL FRAUD AFFECTING 
                                SENIORS

                              ----------                              


                      WEDNESDAY, FEBRUARY 15, 2017

                                       U.S. Senate,
                                Special Committee on Aging,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 2:32 p.m., in 
Room SD-562, Dirksen Senate Office Building, Hon. Susan Collins 
(Chairman of the Committee) presiding.
    Present: Senators Collins, Flake, Tillis, Rubio, Casey, 
Gillibrand, Blumenthal, Donnelly, Warren, and Cortez Masto.

    OPENING STATEMENT OF SENATOR SUSAN M. COLLINS, CHAIRMAN

    Chairman Collins. Good afternoon. That was to wake all of 
you up.
    [Laughter.]
    I am pleased to welcome both new and returning members to 
the Committee, and I am delighted that my good friend Senator 
Casey will be serving as the Committee's new Ranking Member 
during this Congress. I want to specifically welcome Senator 
Catherine Cortez Masto from the great State of Nevada to the 
Committee. We look forward to having you join our work. And, of 
course, it is wonderful to welcome back Senator Gillibrand who 
has been so committed to this issue, and the other issues that 
we have explored as well.
    Speaking of Senator Gillibrand, I understand that her son 
Theo is here today. He is doing a special class project, so he 
got an excused absence to be at our hearing today for the 
project that he is doing, and I know that is going to be a very 
interesting project.
    My apologies also that this hearing had to be delayed from 
when it was first scheduled on February 1st due to a long 
series of votes on the Senate floor.
    During this Congress, this Committee will continue its 
focus on three major issues:
    First, retirement security. We want to make sure that our 
seniors have sufficient resources so they do not outlive their 
savings or find that their golden years end in poverty.
    Second, biomedical research investments for diseases like 
Alzheimer's and diabetes that disproportionately affect 
seniors.
    And, third, financial schemes and other scams targeting 
older Americans, and that is the subject of today's hearing.
    Last summer, an 81-year-old constituent came into my office 
in Portland, Maine, with an alarming story of deception and 
cruelty. A con artist claiming to be an IRS agent had just 
cheated him out of $8,000, and he narrowly avoided losing 
$15,000 more.
    After reporting the crime to the local police, my 
constituent, Philip Hatch, and his son came into my office. My 
staff gave him a copy of the Fraud Book that this Committee 
produced last year as well as a special postcard that we 
created with tips on how to avoid scams. Mr. Hatch told us that 
the tactics described in the materials provided were exactly 
those that were used by the scammer. If only he had received 
that information sooner, he might have recognized the scam and 
avoided losing his hard-earned savings.
    Mr. Hatch was very willing to testify today and to share 
his story, but health issues prevent him from traveling. 
Instead, he graciously and courageously provided a video in 
order to share his experience, and we will see that video in a 
moment.
    This episode demonstrates two important points.
    First, the criminals who prey on our seniors are 
relentless. They will harass seniors over and over again until 
they have drained every penny from their life savings.
    Second, this Committee's longstanding dedication to 
fighting fraud against seniors is raising awareness and 
prompting enforcement actions that are making a real 
difference. We must redouble our efforts to educate seniors, 
their families, and their caregivers.
    The stakes are extremely high. According to the Government 
Accountability Office, America's seniors lose a staggering $2.9 
billion each year to an ever-growing array of financial 
exploitation schemes and scams.
    Today's hearing coincides with the release of our 
Committee's 2017 Fraud Book. Like the book that we published 
last year, it lists the top 10 scams being perpetrated against 
seniors, along with information on how to recognize, avoid, and 
report them. In both years, the IRS Impersonation Scam was the 
leading offender.
    These lists reflect the calls made to our Committee's toll-
free hotline. In 2015, hotline staff fielded more than 1,100 
calls. Last year, the hotline's call volume doubled to more 
than 2,200 calls. It is clear that our efforts are raising 
public awareness, and more important, our efforts are producing 
real results.
    I look forward this morning to the testimony of the 
Treasury Inspector General for Tax Administration's office on 
recent evolutions in the IRS imposter scam, such as the demand 
for payment in iTunes gift cards, to which Mr. Hatch and many 
others have fallen victim. Raising awareness about the IRS scam 
is particularly timely, as we are in the midst of tax filing 
season.
    Last May, thanks to the work of our hotline investigators, 
the IG arrested five individuals in connection with the IRS 
imposter scam. Federal authorities believe that these suspects 
stole almost $3 million from more than 1,200 victims. In 
October, 56 individuals and 5 call centers in India were 
indicted in another important case. In addition to producing 
criminal charges, these efforts are making it more difficult 
for criminals to find victims.
    I also look forward to hearing from the Federal Trade 
Commission on other scams that are targeting our seniors, such 
as those involving grants, counterfeit checks, and romance 
schemes, which are particularly timely with yesterday being 
Valentine's Day.
    As our 2017 Fraud Book makes clear, while we are certainly 
making progress, far too many victims are still losing money 
and often their retirement savings. Law enforcement, consumer 
advocates, Area Agencies on Aging, AARP, and financial 
institutions play vital roles, but alert citizens are still our 
first and best line of defense. I am proud of our Committee's 
work on this crucial issue to help seniors become more aware 
and more informed and to put criminals on notice that they will 
be stopped and brought to justice.
    I now am very pleased to turn to our new Ranking Member, 
Senator Casey, for his opening statement.

   OPENING STATEMENT OF SENATOR ROBERT P. CASEY JR., RANKING 
                             MEMBER

    Senator Casey. Chairman Collins, thank you very much for 
your leadership and for convening this hearing, the first 
hearing of the Committee on Aging, the Special Committee on 
Aging, for the 115th Congress to discuss senior scams, as she 
just outlined.
    Also, I want to thank her for working with me to address 
issues impacting older Americans even before the start of this 
Congress.
    I would also like to welcome new members of the Committee. 
I know right now we have Senator Cortez Masto here--we are 
grateful that she is with us--and, of course, Senator 
Gillibrand who has been with the Committee for a number of 
years. We are grateful for that help, especially on these 
critically important issues for our families.
    The Aging Committee has historically been a committee that 
fosters both collaboration and bipartisanship on issues facing 
older Americans, and that was again abundantly clear by the 
voice vote we held off of the Senate floor 2 weeks ago to 
approve the Committee budget and the Committee rules. And I 
think I was late for that hearing, but----
    Chairman Collins. I was not going to mention that.
    Senator Casey [continuing]. Somehow my voice got recorded. 
But I want to thank the Chairman for that.
    It is my sincere hope that that will continue, and I am 
sure that it will. The future of key programs for older 
Americans like Medicare, Medicaid, and others is also 
critically important to the agenda of this Committee. We have a 
responsibility, I believe, to protect these vital programs for 
older Americans.
    Today we have the opportunity to hear from experts who will 
give us testimony on the challenging issue of combating fraud 
and scams, which, of course, target older Americans--in effect, 
older Americans as well as their families. Experts testifying 
today include Diane Menio from Pennsylvania, from a senior 
advocacy organization that I have worked with over many years, 
CARIE, and I will talk more about Diane in a moment. But I want 
to thank her and her organization's work for what you have done 
for years to help those who are potential victims of these 
kinds of scams.
    I am also pleased to have joined Senator Collins in 
releasing a Committee report detailing the top 10 scams 
targeting our Nation's seniors that you saw a moment ago. The 
report is based upon the experiences of more than 2,200 
individuals who contacted the Committee's Fraud Hotline over 
the past year. It will inform the work of this Committee going 
forward.
    I was also happy to join with the Chairman in reintroducing 
the Senior$afe Act last week. This important legislation both 
encourages financial institutions to disclose suspected 
exploitation of seniors when they see it and protects them from 
being sued for making these reports if they have appropriately 
trained their staffs and made good-faith reports.
    In the Commonwealth of Pennsylvania, more than one in six 
residents is 65 years or older. In 2015, 22,000 cases of 
suspected elder abuse and neglect were reported to the 
Pennsylvania Department of Aging's protective services program.
    That is why last spring I held a field hearing in Wilkes-
Barre, Pennsylvania, to hear directly from constituents--both 
those affected by scams and those trying to prevent these 
scams. Just by way of example, a constituent from Kingston 
Township told the heartbreaking story of a scam artist 
attempting to steal the identity and use the credit cards of 
her husband of 43 years after his death. The Luzerne County 
District Attorney highlighted the most common type of scam 
happening today, at least in that area: the sweepstakes or 
lottery scam. Victims are promised lottery winnings if they 
just pay often sizable so-called taxes and fees up front. The 
district attorney recalled one older victim being scammed out 
of $85,000 in the hope of retrieving $1 million in fake lottery 
winnings.
    While experts struggle to estimate the total financial 
impact of scams targeting seniors, mainly because it is so 
underreported, they know that it adds up to nearly $3 billion a 
year in lost savings--and potentially billions more. It is not 
just money that is lost in these scams. It is older Americans' 
sense of security and financial independence. It is outrageous 
that people who have worked very hard all their lives are being 
targeted for their nest eggs when they are at their most 
vulnerable. And it is wrong that seniors still feel afraid to 
report these schemes. They should not be embarrassed or 
ashamed. They should know that we have their backs and we are 
here to help them fight back.
    That is why enforcement is such a critical part of this 
discussion. While it may not be easy to track down these 
increasingly sophisticated scammers and their domestic and 
international networks and hold them accountable, we must do so 
for the safety and security of our parents and grandparents.
    Recently, Senator Collins and I applauded the Federal Trade 
Commission and the Justice Department settlement with Western 
Union in which the company admitted to criminal anti-money-
laundering violations that have disproportionately affected 
aging Americans. This settlement, $586 million in the 
settlement, will be used to compensate victims of fraud where 
Western Union agents were complicit in the scams.
    But there is more work to do. We will continue to use the 
spotlight of this Committee to both help consumers understand 
the threat and highlight the need for action. It is for this 
reason that I will continue to fight to ensure that the 
Consumer Financial Protection Bureau has the resources that it 
needs. The CFPB houses the only Federal office solely focused 
on sharing financial information with seniors and educating 
seniors about how to prevent becoming the victim of fraud. 
Until recently, this office was led by former Pennsylvania 
Secretary of Aging, Nora Dowd Eisenhower, who is in the first 
row at our hearing today.
    We also need to help keep up the fight to ensure that the 
Affordable Care Act fraud and abuse provisions are in place. We 
know that the Government has realized a record-breaking $10.7 
billion in recovery of health care fraud in the last 3 years, 
having new tools that increased Federal sentencing guidelines 
for health care fraud and on from there.
    We also know that proposals that I will oppose, like block-
granting Medicaid, could present States with real challenges 
when it comes to addressing waste, fraud, and abuse in 
programs.
    Finally, in order to continue the good work of the 
witnesses here today, as well as others, and to support our 
colleagues in other parts of the Government, the Social 
Security Administration and other departments, in maintaining a 
skilled workforce, I am seriously concerned about the impact of 
the Federal hiring freeze and how that will affect middle-class 
families.
    So I look forward to hearing from our witnesses, and I 
again want to thank our Chairman for gathering us today on this 
important topic.
    Chairman Collins. Thank you very much, Senator Casey.
    I want to welcome another new member of our Committee, 
Senator Marco Rubio. Senator Rubio represents the State with 
the highest percentage of senior citizens. I represent the 
State with the oldest median age. That is because a lot of my 
seniors go to Florida, though they tend to spend exactly 6 
months and 1 day there. I am not quite sure, but I have a 
feeling it has to do with taxes. But it is great to have you as 
a member of the Committee.
    And I want to welcome back Senator Warren, who was here 
briefly and I am sure will be returning as well. We will now 
turn to our panel of witnesses.
    First, we are going to view a brief video from Mr. Philip 
Hatch. He is from Portland, Maine, and he will share his 
personal experience dealing with the IRS impersonators that I 
mentioned in my opening statement.
    Next we will hear from Tim Camus. He is the Deputy 
Inspector General for Investigations at the U.S. Treasury 
Department's Office of Inspector General for Tax 
Administration. That may be one of the longest titles of any 
witness that we have ever had. But his office has done 
extraordinary work, and I want to thank him.
    Next we will welcome back to the Committee Lois Greisman, 
who is the Associate Director of the Division of Marketing 
Practices at the Bureau of Consumer Protection at the Federal 
Trade Commission, better known as the FTC.
    And Senator Casey has already introduced our final witness 
for the day, Diane Menio, and we are very happy to have her 
here, too. Menio. Did I get it right that time? Thank you.
    I want to thank you all for joining us, and we will now 
start with the video.

   STATEMENT OF PHILIP HATCH, IRS IMPERSONATION SCAM VICTIM, 
                    PORTLAND, ME (BY VIDEO)

    Mr. Hatch. My name is Philip Hatch. I am 81 years old and I 
am from Portland, Maine, born and raised.
    I received a telephone call. I answered the phone, and the 
man said he was a representative from the Internal Revenue 
Service. I said, ``What can I do to help you?'' He said, 
``Well, we have gone through the records, and there has been a 
mistake here on your returns, and you owe us $5,988 and some 
odd cents.'' So I said, ``Fine. Tell me who I make the check 
out to and where do I mail it?'' He said, ``Well, we cannot do 
that. We have a warrant out for your arrest, and the marshals 
will be in your house within an hour.'' And I said, ``Well, 
what would you like me to do to help resolve this?'' They said, 
``You can go to CVS and get those iTunes cards, and just when 
you come back you can read the numbers off to us.'' I said, 
``That does not sound like a very professional way to do it.'' 
He said, ``Well, it is either that or the marshals are coming. 
If we can do this, we can tell them not to come.''
    So I did. I went and got these little iTunes cards, came 
back, read the numbers off them, and they said, ``Okay. Now, 
you cannot tell anybody about this.'' I said, ``What do you 
mean I can't tell anybody about this? I am going to tell my guy 
that makes up my tax returns. I am a little mad at him.'' You 
know, I said, ``He made a mistake.'' He said, ``Well, no, do 
not do that. Everything will be taken care of.''
    This started at 4:00 in the afternoon and went until 8 
o'clock at night. They called me the next day, and they said 
there was mistake. I said, ``What do you mean a mistake?'' ``It 
wasn't $5,900 something dollars; it was $23,000.'' They had 
somebody call me on the regular phone--I am still on my cell 
phone--who said that he was a Portland police officer and that 
they had a local warrant out for my arrest. So I put my son on 
the phone, and he goes, ``Who is this?'' And they said, ``Well, 
who is this?'' And he goes--he gave him a phony name and said 
he was an FBI agent. And they said, ``Whoops.'' And they hung 
up, and that was the end of it. But I had already sent in 
$8,000 to these people.
    Being in the military and being--working for the 
Government, you know, when the Government calls up, you say, 
``Aye, aye, sir. What do you need? Can I help you? Okay.'' And 
maybe if I had not had that background, I would not have been 
so cooperative. But I got--I was mad, upset that I was taken 
in. Just give me 5 minutes in a room alone with those people 
and I would be happy.
    All I can say is just be wary, you know? You know, just be 
careful. And when it comes to someone going after your money, 
just say, ``Listen, I will think about it tonight and you can 
get back to me tomorrow,'' and then contact someone and find 
out. That is the best advice I could do.
    Chairman Collins. As you can see, this is really outrageous 
and illustrates the lengths to which these criminals will go. 
And a lot of times, they do target people who are either 
isolated or have been in the military--we did a whole hearing 
on scams that are directed at those who have been in the 
military--and they will stop at nothing. They kept Mr. Hatch on 
the phone for 4 hours, from 4:00 p.m. to 8:00 p.m., getting him 
to go from place to place to buy the iTunes card, which is a 
new variation that we are seeing on the IRS imposter scam. And 
it frightens people when they get a call from someone claiming 
to be from the IRS. It frightens all of us to get that kind of 
call. And it has become so sophisticated that these con artists 
can spoof the number so it looks like--if they have caller ID, 
it will say ``U.S. Treasury.'' So that makes them think that it 
is for real. And it just shows that they will stop at nothing.
    I would now like to call on our first witness who is 
actually here with us, Mr. Camus, for his testimony.

  STATEMENT OF TIMOTHY P. CAMUS, DEPUTY INSPECTOR GENERAL FOR 
      INVESTIGATIONS, TREASURY INSPECTOR GENERAL FOR TAX 
                 ADMINISTRATION, WASHINGTON, DC

    Mr. Camus. Thank you, Senator. Chairman Collins, Ranking 
Member Casey, and members of the Committee, thank you for the 
opportunity to testify on the topic of financial frauds 
affecting seniors.
    Over the past 3 years, TIGTA has conducted numerous 
investigations on the issue of IRS-related frauds and scams. 
Telephone impersonation scams, sweepstakes or lottery scams, 
and email and phishing scams are among the top 10 fraud schemes 
used by criminals to target senior citizens. I will highlight 
two major IRS-related scams we have been investigating.
    The first is a telephone impersonation scam in which more 
than 1.8 million Americans reported to us that they have 
received unsolicited telephone calls from individuals falsely 
claiming to be IRS employees.
    The second is the so-called sweepstakes or lottery scam, 
which has reemerged as a significant threat to the integrity of 
tax administration.
    The telephone impersonation scam continues to be one of 
TIGTA's top priorities. No one is immune from receiving these 
calls. I have received calls myself.
    TIGTA has made numerous arrests in connection with this 
scam, and we have a number of significant investigations that 
are still underway. For example, this Committee made a direct 
referral to TIGTA involving a senior citizen located in Florida 
who was so frightened by the impersonators that, following 
their directions, he immediately drove to his local Walmart 
while remaining on the phone with him. During the drive, he 
crashed his vehicle and continued on foot in order to obtain a 
MoneyGram payment as demanded by the impersonators.
    TIGTA special agents worked diligently on this referral and 
ultimately identified five suspects in Miami, Florida. These 
suspects were arrested by TIGTA special agents for wire fraud 
and conspiracy to commit wire fraud.
    In October 2016, after an extensive 3-year joint 
investigation, the Department of Justice obtained an indictment 
on 56 individuals, 24 of whom were located in the United 
States, and 5 call centers located in India. The investigation 
identified approximately $272 million of total fraud and 
thousands of victims involving multiple fraud schemes. This is 
the largest single law enforcement action to date involving the 
IRS impersonation scam, and the operation's success is a result 
of excellent cross-agency collaboration and the efforts of 
hundreds of TIGTA employees who participated in this 
investigation.
    In addition, TIGTA has taken numerous other steps to fight 
this crime. For example, we created a strategy designed to shut 
down the impersonators' callback numbers. We have also 
developed an outstanding working relationship with the Federal 
Trade Commission and the Federal Communications Commission to 
combat this scam. We have worked with the AARP and the Veterans 
Administration on public warning messages.
    TIGTA has also employed a public awareness campaign. We 
have recorded five videos that received over 71,000 views, and 
we have provided approximately 100 print and media interviews 
resulting in over 4,400 news stories in both large and small 
media markets, resulting in an estimated 113 million views.
    We also worked with the private sector such as Walmart and 
Apple, who were used in this massive fraud. These companies are 
now helping us to warn consumers about the scam.
    As a result of all of these efforts, the impersonation 
scam's impact on the public has been significantly reduced. 
Today there are 92 percent fewer reported calls each week and 
93 percent fewer victims reported to us that they paid the 
scammers money. However, the problem has not gone away 
entirely, and the volume is starting to come back.
    For example, we received on average 1,000 reported calls 
per week in early January, and our data for last week shows we 
received over 4,600 calls for the week. I believe sustained 
investigative efforts and ongoing outreach to ensure people do 
not become victims in the first place is critical to our 
success in fighting this scam.
    Another fraud scheme, the lottery scam, has continued to 
target and victimize senior citizens. Its premise is simple: 
The scammers contact victims to advise them that they have won 
a lottery or sweepstakes, but first they need to pay a non-
existent Federal tax or fee in order to receive the prize. Over 
the last few years, TIGTA has conducted investigations that 
have identified over 30 individuals who are responsible for 
defrauding victims out of millions of dollars. We have obtained 
some prosecutions, and we are working on others to address this 
crime.
    In summary, we at TIGTA take seriously our mandate to 
protect American taxpayers and the integrity of the Internal 
Revenue Service. As such, we plan to provide continuing 
investigative coverage in this area, and we look forward to our 
continued collaboration and discussions on ways we can fight 
these types of frauds and scams in the future.
    Chairman Collins, Ranking Member Casey, and members of the 
Committee, thank you so much for your support and for the 
opportunity to share my views.
    Chairman Collins. Thank you very much.
    Ms. Greisman.

  STATEMENT OF LOIS GREISMAN, ASSOCIATE DIRECTOR, DIVISION OF 
  MARKETING PRACTICES, BUREAU OF CONSUMER PROTECTION, FEDERAL 
                TRADE COMMISSION, WASHINGTON, DC

    Ms. Greisman. Thank you, Chairman Collins, Ranking Member 
Casey, and members of the Committee. I am very happy to appear 
before you again to discuss the FTC's broad efforts to protect 
seniors against fraud, which is a critical part of its consumer 
protection mission.
    These efforts are driven through the FTC's law enforcement 
work, its coordination with U.S. and international partners, 
and, with a tremendous emphasis, its education and outreach 
initiatives.
    First, just a quick overview. As you know, the population 
of older Americans is growing rapidly. By 2030, more than one-
fifth of U.S. residents will be over age 65.
    Now, throughout our law enforcement work, we train a 
deliberate eye on whether fraudsters are targeting specific 
consumer populations and, in particular, whether they are 
targeting seniors. We do see that certain types of fraud, such 
as Medicare imposter scams, deceptive pitches for medical alert 
devices, brain training programs to treat cognitive impairments 
such as Alzheimer's, or supplements to address or eliminate 
joint pain, all may well be directed specifically to seniors. 
In other areas, such as the technical support scam, where 
scammers impersonate, for example, Dell or Microsoft and lead 
you to believe that your computer is in dire straits and that 
only they have the remedy to fix it, we do think seniors may be 
disproportionately impacted. And with TIGTA, and as Deputy 
Inspector Camus has just indicated, we have strong partners in 
our work and particularly in combating the IRS imposter scam.
    But as a practical matter, scammers care little about their 
victims' age. As a result, we see seniors impacted across the 
entire spectrum of our consumer protection work, from 
investment in business opportunity frauds to bogus health care 
products to time share resales frauds. I want to take a moment 
to highlight, as Ranking Member Casey referred to, the recent 
$586 million settlement with Western Union. A good many 
iterations of fraud flowed through Western Union's money 
transfer system, but we know, based on the investigation, that 
lottery scams, so-called emergency scams such as the 
grandparents scam, and the online dating or romance scams were 
well represented among the complaints the company received, and 
we know that these types of scams often target and impact older 
consumers.
    In addition to the more than half-billion-dollar 
settlement, the FTC's order requires Western Union to implement 
a comprehensive anti-fraud program that, among other things, 
will require suspension or termination of problematic agents 
under certain requirements. And as you mentioned, the 
Department of Justice entered into a deferred prosecution 
agreement with the company at the same time.
    Not only has the FTC proceeded against money transfers, 
this morning we announced a settlement with a Florida man and 
his company that allegedly helped telemarketers in India dupe 
consumers in the U.S. into paying hundreds or even thousands of 
dollars for taxes they did not owe. These telemarketers, as we 
heard from Mr. Hatch, often pretended to be from the IRS or in 
this case from another Government agency that had grant money 
to dole out, and told consumers to pay via MoneyGram or Western 
Union.
    The defendants with whom we settled were the U.S.-based 
entities that orchestrated having runners literally driving up 
and down the Florida coast to various retail stores to collect 
the money transfers before consumers realized they had been 
scammed and could take some action.
    And as you know, FTC law enforcement regularly collaborates 
with our partners here, State and Federal, as well as 
internationally, and for these purposes, I want to simply note 
that we and our colleagues have spent considerable time working 
with law enforcement and other stakeholders here and in India 
to curb illegal telemarketing hitting the U.S.
    Finally, we continue to improve upon and build out our Pass 
It On education effort. I am sure you are familiar with this. 
We have shared it with you many times. It is aimed at active 
adults, and this is our signature initiative. It reaches 
seniors in social clubs, libraries, senior centers, veterans 
facilities, and we recently added a new video about how an 
imposter scam harmed a retired teacher.
    We also recently posted another new video about the Pass It 
On campaign itself, highlighting how important it is for an 
older consumer to be the one who helps friends and families to 
avoid being victimized. We continue to use these resources and 
to promote them with our State and Federal partners.
    In sum, through aggressive law enforcement, strategic 
policy initiatives, and innovative consumer education, we will 
continue to tackle scammers that exploit older consumers.
    I look forward to your questions. Thank you.
    Chairman Collins. Thank you very much.
    Ms. Menio.

  STATEMENT OF DIANE A. MENIO, EXECUTIVE DIRECTOR, CENTER FOR 
      ADVOCACY FOR THE RIGHTS & INTERESTS OF THE ELDERLY, 
                        PHILADELPHIA, PA

    Ms. Menio. Good afternoon. My name is Diane Menio, and I am 
the executive director of the Center for Advocacy for the 
Rights & Interests of the Elderly. I just thought I would say 
the full name so that you would know why we have a girl's name 
for a name.
    Chairman Collins. Thank you.
    Ms. Menio. Thank you, Senator Casey, Chairwoman Collins, 
and members of the Committee for your interest in financial 
exploitation, fraud, and scams against the elderly and for the 
opportunity to present testimony today.
    Two weeks ago, Charlotte Kitler from Nanticoke, 
Pennsylvania, a volunteer in our Pennsylvania Senior Medicare 
Patrol program, accompanied me here to the hearing. 
Unfortunately, she could not make it today, but I know she is 
here in spirit. She was very excited to be at the Senate. And 
she works very hard with us.
    Today I am going to talk about health care fraud. I am also 
going to talk about abuse, scams, and financial exploitation 
targeting the elderly and how CARIE is working to protect 
seniors across the State of Pennsylvania.
    Founded in 1977, CARIE is a nonprofit organization 
dedicated to improving the quality of life for frail older 
adults. CARIE works to protect the rights of older adults and 
promote awareness of their special needs and concerns. In 
addition, we provide a range of services to help older victims 
of crime, abuse, and financial exploitation, including a 
program that helps elder victims through the court process and 
assists with victim impact statements and Crime Victim's 
Compensation. In addition, CARIE coordinates Pennsylvania's 
Senior Medicare Patrol program to help fight Medicare and 
Medicaid fraud. We have more than 75 retired Medicare 
beneficiaries who provide that peer education about health care 
fraud and share information about how to prevent being 
victimized.
    While we talk about the great toll that financial 
exploitation exacts on its victims, it is important to note 
that the problem of exploitation impacts many people whether 
their net worth is in the millions, the thousands, or even the 
hundreds.
    Every day CARIE peer volunteers like Charlotte talk to 
individuals who have been victims of these horrendous crimes 
and look for solutions to provide guidance to prevent scams 
from occurring in the first place.
    Additionally, we send out ScamWire alerts that help to 
identify new threats to the aging community that seek to 
involve elders in fraud through mailings, email, community 
meetings, and phone calls. I would like to share just a few 
stories about cases we hear every day.
    Seventy-one-year-old Mary from Philadelphia was contacted 
by an individual representing himself as a spokesman for 
Publishers Clearing House. Mary was told that she had won 
several hundred thousand dollars but had to pay the taxes on 
the prize. She initially sent them $200. Then she was contacted 
again, and they told her that she misunderstood and she needed 
to send another $2,850 in cash via the United States Postal 
Service. Mary finally thought better of what she did and filed 
a police report. She initially admitted to the first mailing, 
but then after talking to our victim advocate revealed the 
second amount that she sent. And she told us that she was very 
embarrassed and that is why she had not reported it right away, 
and that is why she was only willing to talk about the $200 at 
first because she felt that that was not so bad. But the extra 
money made her very embarrassed. So she did, after talking to 
our victim advocate, talk to the police about that, gave them 
the information that she was given, the address and the phone 
number of the person that had called her. But, of course, they 
could not find that person anymore. Unfortunately, she could 
not get the money back from the Crime Victim's Assistance Fund 
because there is a time limit involved with that. We just 
really need to offer some of these people more security and 
more ability to resist these crimes.
    Gloria, who is 88 and from Delaware County in Pennsylvania, 
received a phone call from a person claiming to be her 
grandson. When she questioned why he did not sound like 
himself, he said he was in an auto accident and the airbag hit 
his face. So she was scammed out of--it ended up being about 
$7,000 with the iTunes cards. Older people do not even know 
what iTunes card is about, but they are told to go and get 
these. So this was, again, one that the 2-year period had 
expired.
    On an encouraging note, Mrs. Smith, who is a homebound 
beneficiary and lives in central Pennsylvania, called us to 
thank us and to let us know that she received our ScamWire 
alert in the morning, which was included in her home-delivered 
meal package. That same afternoon, she received a phone call 
from a scammer and wanted us to know that she knew not to give 
out any personal information because of the alert. It is 
stories like these that keep us at it every day. We have seen 
many similar cases. You will see many more examples in my 
testimony, and I could even give you more.
    The need to prevent financial exploitation is a national 
imperative. We know that adults and their families must talk 
about and plan for possible incapacity as well. For those 
showing early signs of dementia, this is particularly 
important, as they may eventually lose all capacity to make 
decisions. Financial capacity is often the first to go.
    We do try to work toward positive change. My time is 
running out, so I am going to conclude here. We are very 
pleased at the bipartisan attention to elder fraud that the 
Committee is working on and the Senior$afe Act which builds on 
lessons learned from organizations like ours.
    Thank you again, and we are very pleased to work with you 
on this issue and are here for anything you need. Thank you.
    Chairman Collins. Thank you so much for your testimony.
    Mr. Camus, you mentioned the direct referral from our 
Committee's hotline to your office that resulted in the arrest 
of five suspects who allegedly were responsible for almost $3 
million in schemes that defrauded more than 1,200 victims, and 
this truly was an appalling case that we passed on to you. The 
senior citizen was so upset that he crashed his car on the way 
to the local Walmart to get the debit card. And he was 
convinced that he was going to be arrested immediately, so he 
leaves the scene of the crash and walks the rest of the way to 
Walmart.
    We were able to determine that the money was sent and 
picked up in Minnesota and provided your office with that 
information, and I really appreciated that you acted on it.
    Could you please give us an update on that case since the 
arrest last May?
    Mr. Camus. Yes, Senator, I would be proud to. One of the 
subjects has pled guilty, and he has been sentenced to 2 years 
in prison, and he has been ordered to pay $98,000 in 
restitution to multiple victims. The other defendants are going 
through the various stages of the legal system right now, but 
we anticipate they, too, will be brought to justice here in the 
very near future.
    Chairman Collins. That is great news to hear.
    Ms. Greisman, I am also really pleased to hear the FTC has 
stepped up its efforts, and you mentioned the agreement or the 
settlement with Western Union that had been made. And I am 
interested in whether or not that $586 million is going to end 
up compensating any of the victims. Were you able to trace the 
money that had been lost? And will some of the victims be 
compensated?
    Ms. Greisman. Thank you, Chairman. That is precisely the 
goal of the settlement. The Department of Justice, pursuant to 
the two agreements, the two settlements, will be the claims 
administrator, and they will take it upon them to do their best 
job to try to reach out to victims and provide redress.
    Chairman Collins. That is so important because in the vast 
majority of these cases, once the money has been wired, it is 
gone forever, and it is very difficult to trace. And that is 
why I really appreciated not only the settlement with Western 
Union that is going to lead to some restitution, but the quick 
work of the Inspector General's Office for Tax Administration 
that really stopped a fraud in progress. That is the kind of 
cooperation we need across Government.
    One of the things that truly frustrates me about these con 
artists is that they are very clever and they are always 
changing their tactics to stay ahead of the consumer education 
efforts that we organize, as well as law enforcement. And I 
think we are all making a difference, but the fact is that the 
calls to our hotline doubled last year to more than 2,200. I am 
going to bring up a chart which demonstrates why scammers--it 
is a little hard to read, it is a little busy there--but why 
they are continuously changing their strategies. Let me explain 
it since it is a bit busy, as I said.
    Between November 2014 and early 2016, the losses per month 
in the IRS impersonation scam averaged approximately $1 
million. That is $1 million lost per month. However, starting 
in the spring of 2016, the losses per month increased to $2 to 
$4 million, and I can see Mr. Camus nodding his head in 
agreement. And it stayed at about that level through the end of 
last year.
    What happened during that time is the scammers made a 
change and they are no longer using the Walmart debit card as 
much. They have gone to the iTunes card, which struck me as 
very strange because I thought you used those to buy records. 
But perhaps I am out of it.
    But, Mr. Camus, I would like you to comment on whether the 
change in tactics plus the relentlessness that we have heard 
about from Mr. Hatch where they call again and again and the 
next day with more demands, has that made scammers more 
successful in terms of the money they are bringing in, even if 
the number of victims has declined?
    Mr. Camus. Yes, we noted in April, Senator, April 2016, 
that there was a shift to the iTunes card as a method of 
payment. They also redoubled their efforts on their auto-dialer 
program, so they are able to make hundreds of thousands of 
telephone calls in a very short order.
    To your point exactly, when the scam first started, it was 
individuals calling one on one. And then when they shifted to 
the auto-dialer technology, they were able to blanket 
individuals with hundreds of thousands of calls, leaving a 
callback number.
    At about the same time, they shifted to the iTunes card, 
and what we learned in our investigation was the iTunes card 
makes it very easy for them to flip the money. They are no 
longer paying middlemen to convert payments into money orders. 
They are now selling the iTunes cards on a third-party market 
and then pocketing the money immediately. And, also, it is very 
difficult for law enforcement to trace that transaction.
    Chairman Collins. Thank you.
    Senator Casey.
    Senator Casey. Thanks very much.
    Diane, I am going to start with you, and not simply because 
you are a Pennsylvanian but most especially because of your 
long work. I mentioned as well in my opening comments the 
acronym, and I want to put the words behind the acronym. Diane, 
you have worked for, we will call it, a couple of years----
    Ms. Menio. Yes, just a few.
    Senator Casey. Just a few. I guess I can say decades.
    Ms. Menio. It is 28 years.
    [Laughter.]
    Senator Casey. For the Center for Advocacy for the Rights & 
Interests of the Elderly, so-called CARIE. So we are grateful 
for that work. One question I had was: How do you coordinate in 
your work with both State authorities and Federal authorities? 
Sometimes the most difficult challenge in any investigation is 
the coordination of it. How do you do that? And is there 
anything we should know about those issues?
    Ms. Menio. Yes, it sure is challenging sometimes. But in 
Pennsylvania, we actually have a network of elder abuse task 
forces that operate in various counties across the State. In 
Philadelphia, our task force is specifically focused on 
financial exploitation, and so we have bankers and others at 
the table.
    I think that is one of the best ways to coordinate, is to 
actually know these people, to be able to sit around the table 
and talk about the problem. Sometimes we do case reviews, so, 
you know, you get to talk about how this case got played out 
through the system and it helps us.
    Last year, you know, I know the Committee had a hearing 
about the drug mules that were being used, and one of the calls 
about that came into our office about a gentleman who was from 
Pennsylvania and jailed in Japan. And we were frustrated by 
that because we started calling everybody we could think of, 
and we found no help for that family. But, eventually, he did 
get out.
    But when we were at our task force meeting, we talked about 
that case, and someone from Homeland Security was there, and we 
shared--they gave us their card and said, ``Can we share 
this''--you know, ``Can you share the information about the 
family?'' And so we talked to the family, and we were able to 
connect them with Homeland Security.
    So it is that kind of collaborative work, I think, that is 
very important because we have to know one another. And 
reaching out to community groups that are in the community that 
actually work with older adults, working with law enforcement--
I mean, we do this in our health care fraud program as well. It 
is very important that we can get to the OIG's office, that the 
FBI is involved, all these other groups so that we can get to 
the bottom of this. It is not always the same agency. So we try 
to work in collaboration as much as we can.
    Senator Casey. I want to ask as well about the--you 
mentioned health care fraud. The so-called Senior Medicare 
Patrol, I know you have worked very hard with that patrol. We 
are having a big debate here about the Affordable Care Act, and 
this is one area where there is a very strong set of numbers 
that aligns with the progress that has been made over the last 
couple years in combating Medicare fraud.
    To the extent that you can give an opinion on what happens 
with regard to the ACA, if it were to be repealed, say if it 
were repealed and not replaced--I know that is a big subject of 
debate, but just give us your sense of the impact of the 
Medicare fraud patrol?
    Ms. Menio. Well, there are a number of issues that I think 
that have impacted health care fraud, you know, uncovering 
health care fraud, but also just Medicare and other provisions 
as well that we think are very important, looking at nursing 
homes and a number of other issues. But one of the things the 
Affordable Care Act did--and it is sort of related to your last 
question--is it allowed agencies like CMS, Medicaid, Department 
of Veterans Affairs, Social Security Administration, and others 
to data-share, to help them identify criminals who are 
defrauding. Sometimes, you know, we will get a call--we had a 
lady in Philadelphia who was a podiatrist, and she went into 
Chinatown. She was part of that community. And she started 
basically getting people's Medicare numbers and billing. It 
turned out she was billing like hundreds of thousands of 
dollars--it actually was in the millions. At one point she was 
vacationing in Paris when those bills were submitted.
    It is really important, you know, because we had a couple 
complaints from these beneficiaries, and that is probably not 
going to rise to the level of a major investigation. But once 
you start looking at the data, you can see what is happening. 
And so that is extremely critical. So it is important to see 
because these criminals are going across programs. They are 
similar to the other scammers. They are setting up business 
where it is opportunistic business.
    The other thing that I think is important is that they have 
created--the Affordable Care Act created a Medicare fraud 
strike force, and I think that costs about $350 million, and so 
far it has recovered more than $10 billion. So there is real 
good economic advantage to doing this work, because when they 
do find these scammers, as I said, a lot of them are very large 
scale. The one I talked about was probably small compared to 
some of the large scale. I know in Florida, for instance, there 
were these groups, these storefronts set up to basically pay 
Medicare beneficiaries for their Medicare numbers. And so it 
made these beneficiaries complicit in the fraud. They certainly 
did not understand what was happening. They were getting $10 or 
$20 or something like that, but they did not understand what 
was going on.
    So we really need to continue to do this work to make sure 
that we are combating this stuff. And just sometimes to us, 
when we are getting the complaints, it seems all too easy, and 
sometimes the solution seems easy, too. So we really need to 
make sure that we are looking at how we can make these systems 
work, and I think the more this--what was provided for in the 
Affordable Care Act has created some results, and we need to 
continue doing that.
    Senator Casey. I appreciate that. I am out of time, but 
will come back. Thanks.
    Chairman Collins. Thank you.
    Senator Rubio.
    Senator Rubio. Thank you, Madam Chair.
    I want to continue to build on what you just mentioned 
about the storefronts, and it is a topic that a lot of people 
are not aware of. What we have in Florida, what we in South 
Florida in particular today is an outrageous crisis of Medicare 
fraud, and let me describe it. And I say this to you as a Cuban 
American with both deep regret and sometimes shame about this 
reality. We have literally 50 to 100 individuals, mostly recent 
arrivals from Cuba, who arrive into the United States, somehow 
figure out a way to set up a Medicare company. Usually it is a 
storefront, often just a P.O. box. They then acquire Medicare 
numbers from a runner, from somebody who works at a hospital, 
and they begin to bill those Medicare numbers for no services 
provided. And I am talking about to the tunes of hundreds of 
thousands of dollars.
    I have been flat out told by law enforcement in Florida, in 
South Florida in particular, that if they do not get greedy and 
are just willing to steal $200,000 to $300,000 a month, they 
are probably not going to get caught. They are stealing to the 
tunes of millions of dollars.
    If you look at the list of the top most wanted Medicare 
fraudsters in America, they are almost entirely from South 
Florida and almost entirely recent arrivals from the island of 
Cuba. And when we are about to arrest them--they know they are 
coming--they leave to Cuba with millions of dollars. It is an 
outrage. It is grotesque. It has been extensively covered by 
the press in South Florida. And people may think that seniors 
are not victims, they are just used. They are victims. Number 
one, it is helping to further exacerbate the financial troubles 
of Medicare, and in many cases--you are absolutely right--
seniors are being told there is nothing wrong with this, it is 
legal, just come in, all you got to do is sit down for an 
interview, give us your Medicare number, and before you know 
it, it is their account that is being billed for all this 
amount. And sometimes they get wrapped up in it.
    So I hope that we will have a chance to focus on it. We had 
a chance to discuss it. When I tell people this, they do not 
believe it can--this is organized crime. In every other sense, 
it is organized crime, and they are brazen about it. And they 
laugh about it, because they know they can just leave and are 
protected if they leave the country.
    My mother is a senior--this is why I want to ask you this 
question--and she has been the target in the past. And I just 
recalled this as we were having a conversation. After she 
suffered a stroke in 2011, she is largely home-ridden except 
she goes to therapy and so forth. She gets a call about taxes 
she owes, and I know enough about my mom and her finances to 
know she has not made a lot of money ever, but certainly in the 
last couple years she has not been employed. She relies almost 
exclusively on Social Security and small savings.
    So we get this number, and we tried to--even though I am in 
this position of public service, first of all, I did not even 
know who to call about it at the time. Number two, it is a 
caller ID, so there is nothing I can do about it. But even if I 
had been able to lure them into an extensive conversation, I am 
not sure if I should have gone to local government or the FBI. 
There was a little bit of confusion about who to take it to. 
That is number one.
    The second is her caregiver. She has people that come 
during the day and watch her a little bit, you know, for some 
time to make sure she is taking her meds. They are often the 
people answering it. So we have to figure out a way to educate 
them as well.
    And the third, quite frankly, especially in Florida, for a 
lot of a seniors is a language barrier. My mother speaks 
English, but her first language is Spanish. That is where she 
watches the soap operas every night, which I do not fully 
understand these soap operas and why they are so popular, but 
she watches them on the Spanish language networks, and a lot of 
the people that are being targeted for this are also being 
targeted because of the language barrier.
    So I guess in all of that is embedded the following 
questions: What can we do to improve the awareness of 
caregivers who might be the people answering the phones when 
these calls are coming? What can we do to facilitate for them 
exactly to know who to--like do we recommend that they actually 
talk to these people, engage them, and try to play detective? 
Or do we just tell them to hang up and do not deal with them? 
And the third is: What can we do or should we do to ensure that 
communities, particularly enclaves of seniors that perhaps are 
getting the majority of their news and information in a second 
language like Spanish, that we are doing enough to inform them 
about these scams and these things that are occurring?
    Ms. Menio. Yeah, I think that the public education is 
critical. I do think that another issue you might be interested 
in in the future is looking at why people become subject to 
scams. You know, we talk about people with dementia, but there 
is also an issue around financial capacity. Someone may be able 
to function very well in their life, but their ability to 
manage finances goes down. And one of the reasons older adults 
are targeted so often is because they are the ones who are at 
home and answer the phone. And they might be lonely. And these 
guys, not only do they come up with the latest best scams, but 
they also know how to engage people and become their friends. 
So it is very challenging--I say that because it is very 
challenging, even when we are doing the education, to get 
people to pull back from this.
    When you talk about the caregivers, the caregivers 
certainly should be educated about this as well, because they 
are on the front lines and they will see this happening. I 
will, though, caution that sometimes we do see caregivers being 
the exploiters as well. So it is really important for families 
to be vigilant about this.
    We certainly also deal with people with limited English as 
well. One time we did a presentation in Chinatown, and I think 
it was simultaneously translated into about eight different 
languages so that people could get that information. So we try 
to do as much as we can to reach people and to also train 
gatekeepers in those communities so that, you know, if it is a 
Spanish-speaking community, we can train people in that 
community to take that message to individuals, those people who 
are going into the home, for instance, who are working in the 
housing sites. We have housing coordinators who are working 
with people individually.
    So that is where--and we have had scams--we had a scam by 
somebody telling them they were the cable company. It happened 
in senior housing throughout the city. And so we were able 
through that--and one of them was at a housing site where most 
of the people speak Spanish, and that is where we actually were 
able to tackle the problem because they got it----
    Senator Rubio. And I know I am out of time. Just a 
suggestion. We may want to talk to the two primary Spanish 
language networks about public service announcements as part of 
their FCC license. I think it would be really useful, 
especially for the programming that is geared towards an older 
audience.
    Ms. Menio. And we have been able to get those on our local 
Spanish language stations.
    Senator Rubio. Good.
    Chairman Collins. Thank you very much, Senator Rubio. As 
you were talking, I was thinking that we should get this 
postcard translated into Spanish as well so that----
    Senator Rubio. Do you want me to do it? I will do it. I can 
translate it.
    [Laughter.]
    I even know how to do the accents.
    Chairman Collins. I have no doubt of that.
    Senator Rubio. We will call you ``Susana.''
    Chairman Collins. And I love the idea of including it with 
Meals on Wheels because that would reach a lot of homebound 
seniors. So that is something we can look at also.
    Senator Gillibrand.
    Senator Gillibrand. Thank you, Madam Chairwoman, and thank 
you, Mr. Ranking Member. This is such a vital hearing. You 
know, I have traveled around New York State asking community 
centers and senior centers, you know, ``Have you been 
affected?'' And, overwhelmingly, almost every hand in the room 
is raised, because someone has gotten the IRS scam, someone has 
gotten the grandparent scam, somebody has gotten the 
sweepstakes scam. And it is heartbreaking, and some of these 
seniors have lost tens of thousands of dollars. And there is no 
protection for them, so I have three sets of questions.
    First, what should we do as the Senate Committee to--all of 
you have said, yes, there must be public education. How must 
there be public education? What legislation should we write 
about how to educate all seniors about these scams? 
Specifically, how do we reach all seniors in this country?
    Number two, every one of these scams has public 
participation on some level. The CVS counter that sells the 
iTunes card, the Target that sells the iTunes card, the credit 
union, the bank--thank goodness one New York woman, she went to 
her bank to take out $5,000 to pay the IRS scam, and someone 
sitting outside waiting for her to bring the money, and the 
teller so smartly says, ``Ma'am, you look so nervous. Are you 
okay?'' And she is like, ``No. I have got the IRS on the phone, 
and I have to give them the money right now.'' The woman was 
smart enough to say, ``Give me the phone,'' hung it up, said 
that the IRS will never call you.
    Should we not be having conversations directly with any 
place you can purchase an iTunes card? Shouldn't there be a 
notice that is on every cash register, if someone buys an 
iTunes card, please confirm it is to purchase an iTunes card 
for music, or for a video game, it is not to give to the IRS? 
Why aren't we posting at every vendor that sells iTunes? Every 
bank, every teller should be trained on this. I do not think we 
are doing enough to prevent these horrible crimes from 
happening.
    And all of you have said these are significant criminal 
networks. I have heard some are run by the Russian mob, for 
God's sakes. Like if we knew massive criminal networks were 
targeting our seniors, our families, I would think we would be 
doing much more than we are doing. But for some reason, we are 
not taking this as seriously as we should. It is, oh, these 
seniors are being duped, the money is gone. Well, if we had 
some huge mob cartel bringing drugs into this country, we would 
have Federal action. We would be sending money to address it. 
And I do not feel like we are doing that.
    And the degree of the scam is much bigger than we have even 
disclosed. We only have what has been reported. But we know 40 
percent is not even reported because it is so embarrassing. 
This happened to my aunt. She got the IRS scam. She sent the 
money. She never told my mother who does all her finances. She 
was so embarrassed. So we are not even getting the full report.
    So from each of you, I would like to know what you 
recommend to us to prevent this from warning various parties 
that are involved in these scams unwittingly, the people who 
sell the iTunes cards, the banks. I have a senior who went to 
her bank and took out an advance. And you know what the bank is 
doing to her now? Charging her interest because she cannot pay 
the money back because it is gone. And no relief from her bank. 
So this is a problem.
    So from each of you, direct recommendations for us.
    Mr. Camus. Thank you so much, Senator. You are right on 
target with what we are trying to do. We agree that once the 
money is gone, it is gone, as the Senator pointed out. Public 
education is the number one way to combat this. Criminals will 
continue to go for the vulnerable, in this case senior 
citizens, as long as they get money.
    Senator Gillibrand. Specifically, what kind of public 
education and in what form?
    Mr. Camus. We send our special agents out, and we look 
forward to invites for town hall meetings, especially at senior 
centers, and we have had very good feedback on those. So we 
think we can penetrate into that segment by actually 
participating with Members of Congress at various town hall 
events, and we would be proud to have a special agent come and 
speak to this very issue. So that is just one idea I would 
have.
    As far as the vendors, right now we are working on a 
project with Walmart to do exactly as you describe, that is, 
post placards and train their cashiers, and when somebody comes 
through with a handful of iTunes cards, that there is some sort 
of a dialogue that goes on prior to that purchase being 
consummated: ``There is a scam going on. Are you aware of the 
scam? Have you been told that these iTunes cards are for taxes? 
If you have, it is a scam.''
    We have been successful with MoneyGram, for example, that 
when individuals go on to the MoneyGram kiosk in a CVS, one of 
the warnings that pops up early in the transaction is: ``If you 
have been told to pay your taxes with a MoneyGram, you are 
being scammed. Please stop the transaction.''
    So we totally agree with you that we have to leverage the 
retailers and get them to cooperate, and in some cases we have. 
A recent shift that we have seen is primarily Walmart was being 
used as the retailer, and now our data is telling us within 
just this past month that it is now being shifted to Target. So 
just yesterday, I had one of my executives reach out to Target, 
and we are going to insist that Target work with us the same 
way Walmart did.
    But for us as a small agency, a small law enforcement 
agency, we think that every person that we protect is a 
victory. That is how we view this. It is not just a law 
enforcement aspect. It is every single person that does not 
become a victim is a victory. But how do we collectively--to 
your point, how do we collectively come together and make a 
bigger impact?
    So certainly working with the FTC is something that we have 
really enjoyed doing, but there is still more that could be 
done. But I just want to give you the assurance that we are 
doing a lot behind the scenes.
    Ms. Greisman. Thank you. I appreciate the opportunity to 
address the points you raise. It is very serious, and I do not 
want to have you think in any way that this is not a top 
priority for the Federal Trade Commission.
    In terms of prevention, I would urge each of you, if you do 
not already use our Pass It On materials--put them up again--
these are tested. This is, we think, a very effective way to 
reach seniors where they are and to provide them with the tools 
they need so that they are the ones positioned to assist 
friends and family members not to be victimized. There is a 
specific piece on IRS imposter scams.
    The intermediaries, there are two things we do. One, we sue 
them. That is what the settlement with Western Union is about. 
We had a settlement years before with MoneyGram. Through 
amendments to the telemarketing sales rule, we made illegal 
wire transfers in connection with telemarketing, and we also 
prohibited other types of reloadable cards being used. So law 
enforcement is front and center in terms of the intermediaries.
    Also, as Deputy Inspector Camus referred to, we have lots 
of conversations with Apple, with Walmart, with the trade 
associations for relevant industry members. The Western Union 
settlement, like the MoneyGram, imposes specific requirements 
to make it more likely that the company will intercept and 
prevent the transfer of money, because as we have all 
discussed, once it is gone, it is gone. And that is exactly why 
the scammers are using those types of payment instruments.
    So that is where we are. We will continue to work with 
industry members to get better signage, to get other analytical 
tools in place so that they can identify where the bad actors 
are and how the transfers are going forward. Thank you.
    Ms. Menio. I cannot agree more with what you said, but I do 
want to put a plug in for the Senior$afe Act, which is one 
thing that you can do. One of the biggest problems we have had 
with financial institutions is making these reports.
    In my written testimony, you will see a story about a lady 
who was bilked out of $800,000. That was basically everything 
she had. She was in her 80s, and she thought she was winning 
the lottery. And so she kept paying money and did not tell her 
family until it was way too late. And I think it was finally--
she and her husband had invested their money with an investment 
firm for, you know, all their adult life, and her husband had 
died, and that was their money in the bank. And no one made a 
report, and eventually the money got transferred to another 
bank, and she continued to buy these Walmart cards and 
everything to pay this thing. And, finally, that second bank 
made a report, but that was after $800,000 was lost.
    So we need to do something to make them feel better. I 
mean, you know, we keep pulling out the Gramm-Leach-Bliley Act 
and saying, ``You can do this. You are covered.'' But they 
still are not doing it. And sometimes--I can tell you what 
happens--in some of the cases that work out well, it is the 
teller who is making the report. They are not necessarily 
authorized by the guys at the top, but it is the teller who is 
coming in and they are seeing all these withdrawals taken. So 
that gets to your point of training the people who see it 
happening, the people who are--the tellers at the bank--
although we have fewer and fewer of those these days--and the 
people who are at the stores.
    The other thing is that we need to encourage age-friendly 
services in those institutions. We need to have fraud 
technology. There is a lot of technology out there these days. 
I remember sitting in a meeting with the bankers and saying, 
well, you know, if I am out of town and I use my credit card--
like I was somewhere, in Chicago I think, and suddenly my card 
got shut off. Well, you know, it was legitimate charges, but 
they shut off my card because they were monitoring it. I said, 
Why can't you do that for some of these cases? And they are 
very shy about doing that. They will not do it.
    But those technologies really need to be used for this. 
They need to come into action. And the age-friendly services 
are also important, to make sure that they have protections, 
like encouraging them to plan for incapacity, offering age-
friendly account features, like having someone who has access 
to your account. Maybe they cannot take money out, but the 
daughter, for instance, can get in and monitor online to make 
sure nothing is going wrong.
    And so all of those kinds of things I think can be done. I 
hope that we can do more to combat this, and we need to--you 
know, when you talk about education, sometimes it really is 
just as easy as putting up a sign at the cash register so the 
person managing that cash register sees somebody buying--an 
older person, somebody who is 80, 82 years old, buying all 
these iTunes cards, that is a flag. I cannot imagine why you 
would not report that. So we need to do exactly what you are 
saying.
    Chairman Collins. Thank you.
    Senator Cortez Masto.
    Senator Cortez Masto. Thank you. I am very excited to be a 
member of this Committee, so thank you very much. And thank you 
to all of you for what you do.
    I was fortunate to be able to work with the FTC as the 
Attorney General of Nevada and had great partnership, and many 
of you we have worked with on so many different levels. This 
area was important for me as Attorney General. That is why I 
created a unit in my office to address elder abuse, neglect, 
and exploitation. Every single one of the scams that you 
identify here happens in Nevada, and we had some great 
partners.
    I want to talk on a couple of levels, though. The first one 
is the public education, because to me this is the first step 
in prevention, and it is so hard to do. It really is. There are 
many of us that are trying to do our outreach and get out and 
talk to folks, but it has to be on a constant basis. You cannot 
just say I am throwing this out there, we will it overnight, 
and that is done. The education occurs all the time. All the 
time.
    I have been--I always say this--just about to every senior 
center in Nevada to reach out to our seniors. But it is not 
just reaching out to seniors. It is reaching out to their 
caregivers. It is reaching out to family. It is reaching out to 
service providers. So for my purposes--and this is what I am 
going to ask with your help--I had put on conferences in the 
State of Nevada, just bringing people in for the training, for 
the public education, bringing the experts in to talk about it, 
how we educate, how we train, and how we constantly get that 
information out. That is one thing that I would love your help 
with in Nevada, to continue down that road.
    The next one, however, is challenging for me when it comes 
to law enforcement, and this is a question I have for our law 
enforcement folks. Given the aging population--in Nevada it is 
growing, but also we are constantly evolving with technology 
and technological scams--what additional resources or 
innovations does law enforcement need to keep up with the 
financial threats posed to seniors now? And when you talk about 
it, talk also about how we examine also the money transfer 
systems, which make it much easier for some of these criminal 
elements to engage and scam our seniors.
    Mr. Camus. Just a couple ideas. Thank you, Senator, and we 
do look forward to working with you in Nevada.
    One of the ideas you could come up with would be--there is 
a 72-hour right of rescission on large transactions, so maybe 
it could be considered that on any wire transaction, instead of 
it being rapid and instantaneous, there is some sort of a 72-
hour right of rescission, because many of the victims that we 
spoke to, they realized it, but just a little bit too late. By 
the time they realized or talked to a family member about being 
scammed, the money was already gone, and there is no way to get 
it back. But if we could get that frozen for just a period of 
time to allow a recognition, a family discussion, or law 
enforcement to intercede, we might be able to save people a lot 
of money and save their lives actually.
    But as far as some of the other ideas, the challenge for 
law enforcement is the money moves so quickly and the ability 
to convince somebody to put their Federal income tax payment on 
an iTunes card, that is really difficult. As I said in my 
testimony, we estimate that just through media on our own as a 
small agency, we believe that we--we had 113 million views, 
over 100 media interviews, and it is constant with us. We had 
Apple agree to fund a pilot program where over the air in CVS 
stores and other drug stores, the message over the air as they 
were shopping was, ``Do not use Apple iTunes cards to pay 
public debt. Do not use Apple iTunes cards to pay Government. 
It does not work that way.'' And we think that that worked, but 
it is very, very expensive. That project cost Apple I believe 
$140,000 to fund that. But it was a pilot.
    So if we could get more of that type of cooperation, a fund 
set up where some of these retailers and companies are required 
to put aside some money to help educate and continuously 
educate--because it is so difficult to penetrate. You know, I 
am not a journalism major, but I am astounded by how difficult 
it is and how--and I take calls myself at my desk. And just 
this morning, I took a call from a victim, and they had no idea 
that there was any such thing as an impersonation scam. And it 
perplexes me. I am, like, ``What more could we all do, what are 
other things that we can do to try to reach that?''
    Senator Cortez Masto. Yeah, and that is why it is constant. 
The education has to be constant, because people are not really 
listening. And let me just say one thing as well, and I found 
this in Nevada. Part of it, too, is when they become victims--
and we have heard it here, but they are embarrassed to come 
forward. They are embarrassed to say that this happened to 
them. And we have to give them a venue to be able to say it did 
happen, it is all right, it is happening across this country, 
to make sure that they are willing to come out and educate 
themselves and educate others about this type of scam.
    Ms. Greisman. Thank you, Senator, and we have enjoyed the 
cooperative relationship with your former office as well.
    You mentioned how do we get out into the community. Well, 
we have had some 33 common-ground conferences throughout the 
country. One was in Vegas with the help of your former office. 
There we are working with grassroots members, people from the 
Chamber of Commerce, legal service providers, obviously the 
Attorneys General offices, local law enforcement. And the 
discussions vary nationwide, but a lot of focus is on issues 
affecting seniors in the community. And we learn from those 
conferences. We push out our consumer education materials. We 
will continue to do more on that front.
    Money transfer services, well, I would like to sit here and 
be cautiously optimistic that the near half-billion-dollar 
settlement with Western Union will squeeze some of the fraud 
out of that system, and I think it will. It is an order with 
very rigorous requirements that, if they adhere to them, should 
make a difference. Of course, if we are squeezing money out of 
that system, then it is just going to find another path of less 
resistance to move to.
    There is no silver bullet in this. Education has to 
complement law enforcement, and that is what we are committed 
to doing. We certainly look forward to working with each and 
every one of you to build upon what we have been doing.
    Senator Cortez Masto. Thank you. And let me just add one 
final thing. Diane, the Senior Medicare Patrol unit was in my 
office. It is instrumental. I will always continue to support 
it. I cannot tell you how many seniors not only were excited to 
be a part of it, but we were able to uncover fraud. And I 
cannot say enough about the journals, the diaries, the health 
care diaries and journals that we would hand out to 
individuals. It matters. They really pay attention when you 
talk about it and when you have their peers talking to them 
about how we address Medicare fraud and Medicaid fraud, which 
we handled in my office. It made a difference. So I will 
continue to support programs and advocacy, so thank you for 
what you do.
    Ms. Menio. Thank you.
    Chairman Collins. Thank you, Senator.
    Senator Flake.
    Senator Flake. Thank you, Madam Chair. Thank you. Sorry if 
I am plowing old ground here, but could you tell me what 
innovative programs are already out there that the States have 
come up with for addressing these senior scams? Anybody who 
wants to start there.
    Mr. Camus. As far as the States are concerned?
    Senator Flake. Yes.
    Mr. Camus. We work with multiple States, and we work with 
law enforcement agencies, local and other Federal partners. And 
I am not uniquely aware that any of the States that we are 
working in have come up with innovative approaches, but I am 
probably not the one that is best suited to answer that.
    Senator Flake. All right.
    Ms. Greisman. Many States have wonderful, robust programs 
addressing fraud targeting seniors. Many have discrete offices 
that directly focus on that, and to the extent possible, we 
work closely with them. I had mentioned earlier our Pass It On 
materials. We freely distribute those to the States. We urge 
everyone to put their own name on it. We have no copyright 
interest in it. We just want to pass on those materials so that 
they can be used.
    Senator Flake. Okay.
    Ms. Menio. And can I just add that one of the tools we have 
at the State level is the Older Adult Protective Services 
Office, which often gets the first report on these cases. And I 
just want to say that one of our recommendations is to make 
sure that those programs are strong enough to do what they need 
to do.
    One of the things that they often lack is forensic 
accountants, for instance, to be able to actually take on a 
case and figure out what is happening. So we need more 
resources in that program. And at the same time, we are aware 
that the social services block grant funding is under question 
at this point, and that is the money that often supports those 
programs at the State level. So, you know, while we need to 
enhance the funding for those programs, we need to at least 
maintain the funding for those programs, because they are often 
the first line. When Senator Rubio asked who to report to, I 
did not answer his question, but what I meant to say was just 
report it, it does not really matter, because when you report 
it to one place, it will get to the right place eventually. And 
that is what Protective Services does. It is the first line, 
and it is very helpful to be able to get that person into the 
system.
    Senator Flake. Well, thank you, Ms. Menio. You mentioned in 
your testimony that a beneficiary called to thank you for the 
timely ScamWire alert she received in her home, and they 
delivered a package shortly thereafter. Are there any 
reoccurring services that seniors use where companies can 
include these fraud alerts so that they can be delivered more--
--
    Ms. Menio. Yes. We also distribute those to public 
libraries, senior centers, senior housing. We distribute them 
to a large number of places where we know--grocery stores, 
places where people gather, where older people do business. And 
the home-delivered meals project that we do is really focused 
on people that we will not reach by going to a library or a 
senior center or those kinds of places. It is the people who 
are homebound and do not get out and would not get that message 
otherwise. But we are trying to do that through many different 
public venues.
    Senator Flake. All right. Thank you, Madam Chair.
    Chairman Collins. Thank you, Senator Flake.
    Before you were here, Ms. Menio mentioned the Senior$afe 
Act, which you were a cosponsor of in the last Congress and 
which we have reintroduced. Senator Casey is a cosponsor. And 
just yesterday, AARP has endorsed that bill along with we have 
endorsements from Legal Services for the Elderly, the National 
American Securities Administrators Association, the Conference 
on State Bank Supervisors, the National Association of 
Insurance Commissioners, and a wide variety of regulatory 
groups, and that is one concrete action we could take in this 
Congress that would really make a difference in empowering 
those front-line tellers that our witnesses were describing and 
who can make a real difference in stopping fraud right up 
front. So I am going to ask unanimous consent that all of those 
endorsement letters be entered into the record.
    [The letters referred to are in the Appendix.]
    Chairman Collins. Senator Warren.
    Senator Warren. Thank you very much, Madam Chair, and thank 
you very much for holding this hearing, you and the Ranking 
Member. And I want to just follow up. I think your point about 
how better to empower people on the front lines is really 
important. I just want to look at another aspect of that.
    As we know, the con artists who perpetuate IRS 
impersonation scams, identity theft, and other forms of 
financial exploitation often target seniors. And when a senior 
needs to report that they were the victim of fraud, it is 
frequently the men and women who work in our Government 
enforcement and consumer protection agencies in Washington and 
in all 50 States who are on the front lines taking their calls 
and investigating their cases.
    So it seems pretty obvious to me that one easy way to 
protect America's seniors from fraud is to strengthen that 
workforce. But instead of staffing up the workforce that cracks 
down on scammers and fraudsters that hurt our seniors, on his 
first full day in the Oval Office, President Trump issued an 
Executive order freezing Federal hiring and starving our 
enforcement agencies of their most important resource--American 
workers.
    So, Mr. Camus, you are Deputy Inspector General for 
investigations at the Treasury Inspector General for Tax 
Administration. Your job is to protect seniors against scammers 
who pretend that the IRS is calling and trying to collect back 
taxes. Almost 2 million people have reported this scam to your 
office, and these scams have cost Americans more than $54 
million. That is a lot of money.
    Does a hiring freeze help you achieve your goal of 
protecting seniors from fraud?
    Mr. Camus. As you point out, Senator, these are--it is a 
huge issue, and every one of these victims is a significant 
challenge on our resources. So, naturally, I have been told I 
am not allowed to pander for resources at these events, but----
    Senator Warren. Okay. We will let you know if you have 
crossed the line into pandering here.
    [Laughter.]
    Mr. Camus. I can tell you I am very proud and we are very 
efficient agency, but certainly this has stretched our agency 
very thin. We are seeking the exemption in the President's 
order under a public safety clause, at least for the special 
agent portion of our workforce.
    Senator Warren. Well, I appreciate that, Mr. Camus. You 
know, according to testimony from your office back in 2016, 
``Reduced staffing has affected the IRS' ability to deliver its 
priority program areas, including customer service and 
enforcement.'' Given that your enforcement team is already 
understaffed, I worry that this kind of hiring freeze is music 
to criminals' ears.
    Now, Mr. Camus, you also work with the Department of 
Justice to help protect seniors from criminals who are trying 
to defraud them. Will the hiring freeze help you with the DOJ?
    Mr. Camus. Again, you know, it is--we are only limited, all 
of us are only limited by how much resources we have, and we 
are all very passionate about protecting all Americans, but 
most especially our most vulnerable. That is why I took the 
oath to be a law enforcement officer. So it is a challenge. 
Resources are a challenge on a good day. So any disruption in 
that is certainly a cause for concern.
    I am not sure whether the Internal Revenue Service or the 
Department of Justice have any exemptions available to them 
under the order.
    Senator Warren. All right. But if they do not?
    Mr. Camus. I could not comment. I do not know the impact.
    Senator Warren. You know, I just want to point out we have 
seen this movie before. A 2011 hiring freeze at the Social 
Security Administration eliminated 15 percent of the agency's 
workforce and closed 64 field offices. Ms. Menio, you are the 
executive director at the Center for Advocacy for the Rights & 
Interests of the Elderly in Philadelphia.
    Can you explain how the 2011 Social Security personnel 
freeze affected the seniors that your center works with every 
day?
    Ms. Menio. Well, certainly it takes a lot longer to make an 
appointment.
    Senator Warren. So increased wait times.
    Ms. Menio. I can tell you that we are--you know, 
interestingly, the Social Security--I am in downtown 
Philadelphia, and the Social Security office is in our 
building. They have the top floor. And the way that it works is 
no one goes upstairs until the guard lets them go upstairs, so 
they get the message, ``You can send more people up.'' And that 
line gets quite long, and people are standing there with their 
walkers and their canes and waiting to go upstairs. And so that 
is something I see every day.
    I can also tell you that my staff spends a lot of time when 
they are helping consumers doing three-way calls because we are 
not--you know, we like to empower people and work with them, 
but sometimes it is difficult for them to make that call on 
their own. So we will sit with them, and they tell me it is 30 
minutes to an hour sometimes they are waiting for that call to 
get through.
    We had a client who called us recently from the western 
part of the State. Her husband died and she was collecting--she 
wanted to switch her Social Security so she could collect on 
his account, I believe something like that. And what happened 
was--and, you know, I think this is illustrative of the short 
staffing. She got lost in the system. She did not get a check 
at all for 3 months, and that meant her Medicare Part B was not 
being paid. And so she did not even have her health care during 
that time. Eventually, we were able to help her get that back, 
but, nevertheless, it was a very stressful time for her. It 
should not have happened that way. It probably took more man-
hours from the Social Security office to fix this than it would 
have taken to help her in the first place. So those are some of 
the kinds of things we are seeing.
    I also know that the Center on Budget and Policy Priorities 
put out a report, and they said that less than 1 percent of 
their expenses are spent on overhead. I cannot run my agency on 
less than 1 percent--I wish I could, to be honest with you, but 
I cannot. And so that just is not realistic. How can you 
continue to provide the level of services to this aging 
population, to many of us who are ready to, you know, go into 
the Social Security system, into Medicare? We need to be able 
to get that information as quickly as we can and work with 
people without going through a lot of red tape and spending 
hours on the phone and in offices.
    Senator Warren. And I appreciate that. I just want to add a 
couple of statistics if I can, and then I will quit. Thank you, 
Madam Chair.
    You know, appeals times also go up. She is talking about 
helping people apply. But the appeals times go up. Almost 
20,000 people died waiting for a disability eligibility 
discussion in fiscal year 2016. You know, with all of these 
negative consequences, you would at least hope that these 
freezes save money. But what the data actually show is that 
they do not save money, that we have a workforce that is just 
more stressed, more inefficient. You spend more time trying to 
fix the problems that are broken because you did not solve it 
early on.
    I just want to say I appreciate the work you are doing, and 
I hope that we can give you better support to do it. Thank you.
    Thank you, Madam Chair.
    Chairman Collins. Thank you.
    Senator Tillis.
    Senator Tillis. Thank you, Madam Chair, and thank you all 
for coming before the Committee and, at least in one case, 
returning to the Committee.
    I have got a more general question. This Committee is 
intended to provide insights into seniors' abuse, caregiver 
programs, those sorts of things, over the course of the last 2 
years that I was on it. And then we have had some discussions 
about legislative proposals here at the Federal level, and we 
have talked about potential best practices down in the States. 
But it does not seem to me we have made much progress, so could 
you give me in any of your opinions, in the capacity before 
this Committee, of examples of where I should be kinder in my 
assessment? What kind of progress are we making at the State or 
Federal level that you think is really moving the ball 
substantially in the right direction? Mr. Camus, want to start 
with you?
    Mr. Camus. One of the biggest challenges I have, Senator, 
is--and I have been working with staff here--as we investigate 
crimes, we learn. We learn how they are doing it; we learn how 
they are shifting. And as Senator Collins pointed out, the 
criminals are watching every single thing that we do from all 
over the world, and then they are adapting to what we do. It is 
literally a cat-and-mouse game, and they will continue to 
victimize our most vulnerable citizens because they can get 
money. So any ideas that we have, we are happy to meet with 
staff and talk about this is how the crime happened, so 
legislatively, what are some of the areas that could be 
explored.
    One of the things we are excited about is in our 
investigation through the FTC's help, we started working with 
the Federal Communications Commission, and what we learned was 
they have task forces under the U.S. Telecom Consortium that 
are actually working on technology to block robocalls that are 
coming in spoofed. And in one pilot, in the IRS----
    Senator Tillis. Not political ones, right? No, I am 
kidding.
    [Laughter.]
    Mr. Camus. In the robocall area, in a pilot, they were able 
to block about 2 million spoofed calls that were coming in that 
could have hit the seniors. How many people would have been 
victimized by those calls?
    And then the other area that we are excited about the 
technology is there is a trace-back task force as well, and 
what that will allow us to do as law enforcement is be able to 
figure out, when the bad guys are calling in from offshore, 
quickly determine where that call came from and then work with 
partners offshore to try to get them investigated or taken out 
of service.
    Senator Tillis. How do we get to a point where we are 
scaling some of those things to where we are going from kind of 
a good proof of concept to a pervasive capability that--clearly 
something like that could have a significant effect on a lot of 
the nets that are being cast and then capturing seniors and 
then taking advantage of them. So I think that is more of--we 
will go down and just get an assessment for why I should feel 
better about things that we can scale, but give me your read 
down the panel.
    Ms. Greisman. Thank you, Senator. I appreciate the 
opportunity to be here again.
    Aggressive continued law enforcement is ongoing, and it is 
making a dent. It may not be a sustained dent, but you have 
got--that is not a reason not to do it. I will point again to 
the recent Western Union settlement, $586 million, with 
significant injunctive relief requiring the company to change 
how it does business in terms of fraud prevention.
    The recent crackdown by DOJ with TIGTA on entities in the 
U.S. and in India, targeting U.S. consumers with the IRS 
imposter scam, those make a difference. We need to figure out 
how to sustain them and implement them on a more permanent 
basis.
    Mr. Camus just referred to some of the work going on with 
robocalls. We have been at this for years, and what has 
happened as a result of it is that new technologies have been 
developed, they are in the marketplace. One of the first ones 
was a result of an FTC challenge back, I think, in 2012. These 
are call-blocking technologies that work. And then there is 
more great cooperation and coordination among industry and 
Government to bring these technologies to the forefront and 
also to develop--though it is not going to happen overnight--
caller ID authentication. That will provide a significant tool, 
technological change that will prevent some of these calls from 
hitting consumers. So I think there is good reason to be 
optimistic.
    Ms. Menio. Well, I wish I had some of their answers for 
you, but we are not on that scale. But I think on a very large 
scale, in a sense, our Senior Medicare Patrol is a good example 
of this work, and it is in every State in this country. And I 
can tell you right now we are working--we had some consumers, 
some beneficiaries call us about something that we think is a 
scam, not totally--we are not sure yet, and I am not going to 
say what it is because it is being investigated right now. But 
what we were able to do is get on the phone with people from 
your State and from, I believe--I am not sure if it is Maine or 
not, but it is one of the New England States--a number of 
States with our colleagues who are doing the same work we are 
doing, and we were finding out that the same scam is--or the 
same situation is happening in each of those places, which made 
it a lot easier for us to go to the Inspector General with 
this. And so it is being investigated now. We think it might be 
a very large scale issue. That is the way--but, again, it gets 
back to that working in collaboration with other people is so 
important, because we get two calls, we will say maybe it is a 
problem, maybe it is not. It sounded fishy, so we definitely 
wanted to look into it further. But with those two calls, 
nothing was going to happen when we called the OIG. But once we 
get our colleagues from other States identifying these problems 
as well, then that makes a case. And I think something can 
happen to protect people in the future through that situation.
    Senator Tillis. Well, thank you, and I know that the Chair 
has put together great proposals for programs that have worked 
their way through Congress and authorizing maybe additional 
initiatives that will be helpful. But it really also points to 
why we have got to get to a regular order appropriations 
process so that we then have the financial resources behind 
these programs to scale them and get them implemented, and so 
that we can come back and start measuring what I think are the 
results that can come about. A lot of great ideas, a lot of 
great pilots, a lot of great proofs of concept, a lot of great 
law enforcement actions that we have just got to scale. And 
then, also, if I had more time--I am way over now. At the end 
of the day, most of what we are talking about here are the 
cure. We have got to work on the prevention side, which means 
that we have to continue to focus on education, destigmatizing 
public acknowledgment that you have been abused, and doing 
those kinds of things so that you very early in the cycle of 
abuse prevent it from ever happening.
    Thank you.
    Chairman Collins. Thank you very much, Senator. I certainly 
agree with your comments about the appropriations process. I 
would indicate that, compared to the very first hearing that we 
held on scams, we have come a long, long ways. Law enforcement 
has stepped up to the plate, has started aggregating these 
scams rather than dismissing them because they are only $2,000 
here or $3,000 here. And when GAO came out with $2.9 billion 
annually, I really think that helped, and our hearings helped 
raise the awareness of the public and the need for aggressive 
enforcement, the cases that were described earlier today. So I 
am actually encouraged that we are making progress, but these 
criminals are relentless and will continue.
    Senator Tillis. Me, too, Madam Chair. I am just mad at the 
people that do this, and I want them to suffer badly as a 
result of it, as quickly as possible.
    Chairman Collins. Well, there is nothing like putting 
people in jail to be a good deterrent, that is for sure.
    Senator Blumenthal.
    Senator Blumenthal. Thank you, Madam Chairwoman, and thank 
you for having this hearing and your very, very persistent 
drive to increase the effectiveness of our laws and the 
enforcement of them. And like my colleague from Nevada, I was 
State Attorney General for some years--in fact, 20 years--and 
we established a unit quite a while ago to focus on elder abuse 
and criminal activity that victimizes them. And I agree as well 
that education is among the best preventive steps. An ounce of 
prevention is worth a pound of cure. Recovering money after the 
fact is very difficult, but it is possible. And educating the 
bad guys is important, at least as important as educating the 
good guys, because educating them through deterrence, the Chair 
is absolutely right that prison time teaches a very valuable 
lesson.
    So with that in mind, I introduced a bill called the 
``Robert Matava Criminal Victim Abuse Prevention and 
Restitution Act.'' It became, with bipartisan support, the 
Elder Abuse Prevention and Prosecution Act, which was approved 
by the Judiciary Committee. In fact, it is bipartisan. Senator 
Grassley and I together lead it, and it would improve the 
current law in a number of ways. It is now out of Committee. It 
is on the House floor. We can approve it if we get bipartisan 
support there; and if our distinguished leadership there puts 
it on the floor, I am sure it will be approved near 
unanimously.
    It would expand data collection and information sharing to 
better prevent and respond to elder abuse and exploitation. It 
would increase training, improve information sharing among 
agencies, and it would increase penalties for perpetrators of 
these crimes. So the anger that my colleagues feel could be 
channeled very positively and effectively against those bad 
guys by passing this measure, including mandatory forfeiture to 
deter future offenses.
    Everybody here knows that what drives these crimes is 
money. If you require mandatory forfeiture, it hits them where 
they live. And mandatory forfeiture, in fact, will enable more 
restitution so that we prevent by deterring but we also make 
people whole, or at least work to make them whole.
    So to any of you who would like to answer, do you believe 
that mandatory forfeiture, restitution, and increased penalties 
for perpetrators will be effective in deterring future criminal 
activity? That is the softest ball that anybody has thrown to 
you in quite a while.
    [Laughter.]
    Mr. Camus. As a career law enforcement man, yes. We work 
really hard and we dedicate resources to investigate these, and 
there is nothing like at the end of the day when my agents can 
go to court and the perpetrator especially picking on our 
vulnerable citizens gets a significant sentence. So the more 
that we could punish them and the more that we can rapidly 
recover any monies that are available--in many cases, there may 
or may not be assets available--the better for us. So we 
wholeheartedly agree with increased deterrence through 
increased penalties.
    Ms. Greisman. Senator, it is a delightful softball. We are 
a civil law enforcement agency, so I cannot speak to it. I have 
to defer to my criminal colleagues. I will say, though, that 
anything that ramps up deterrence and helps us on the civil 
side would be greatly appreciated.
    Senator Blumenthal. Thank you.
    Ms. Menio. And I would just like to add that I think one of 
the reasons that elderly are targeted is that oftentimes the 
perpetrators feel that they are not going to--and I am talking 
more about that homespun type of financial exploitation that 
happens. They just think they are going to get away with it, 
because they do. And so one of the things we are advocating for 
in Pennsylvania is enhanced sentencing for people who commit 
crimes against the elderly.
    So I think it is very, very important because the other 
issue that we have often with crimes against the elderly is 
that if someone does have dementia, oftentimes we are finding 
that the police are not arresting because that person is not a 
good witness in court, they are not a good reporter. So we have 
got to get past that as well. And I can tell you of some 
horrendous crimes that have been committed against people who 
are without capacity. And we have got to come up with a system 
to make sure that there is a reason for people not to do this, 
that they are going to be a little afraid of taking advantage 
of the elderly. So thank you for that.
    Senator Blumenthal. Thank you all for your support, and 
thank you for your great work. Thank you, Madam Chair.
    Chairman Collins. Thank you.
    I want to thank all of our witnesses today for your very 
important contributions, whether it is law enforcement or 
education or civil actions against those who would rip off some 
of the most vulnerable citizens in our country, our Nation's 
seniors.
    As we have heard today and as our Committee's new Fraud 
Book makes clear, criminals are relentless in their pursuit to 
swindle seniors out of their hard-earned savings. We see 
infinite varieties of these scams. Once one is closed down, 
another pops up. I, too, have had those phone calls on my home 
answering machine in Bangor, Maine, and I called the IG's 
office up immediately because I was so excited. I thought I 
could help entrap one of these criminals, and it turned out 
that the numbers expire after 3 days. So that by the time I got 
home for the weekend, the numbers were no good. I was so 
crushed because I thought I could help bring these people to 
justice, which is exactly what is the commitment of each and 
every one of us here.
    While much remains to be done, I am proud that this 
Committee has been just as relentless as the criminals in 
fighting back against this fraud, and the important work that 
all of you are doing really contributes to our efforts.
    I look forward to continuing to work with our Ranking 
Member and with our returning and new members of the Committee 
as we continue this fight in the new Congress. Committee 
members will have until Friday, February 24th, to submit 
questions for the record.
    As a reminder, at the risk of sounding like one of those 
late-night infomercials, the Committee's toll-free fraud 
hotline number is 1-855-303-9470. 1-855-303-9470. The reason I 
mention that is those 2,300 calls that we got last year enabled 
us to identify new scams so that we could warn people and come 
up with tips for avoiding people becoming victims. So we have 
distributed so many copies of our Fraud Book and our postcard, 
and we are going to continue those educational and prevention 
efforts as well.
    I would call on our Ranking Member if you have any 
concluding remarks that you would like to make, Senator Casey.
    Senator Casey. Thank you, Madam Chair. 1-855-303-9470.
    [Laughter.]
    Thank you for the message. Thanks very much.
    Chairman Collins. Thank you. This concludes our hearing. It 
is now adjourned.
    [Whereupon, at 4:19 p.m., the Committee was adjourned.]



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


                                APPENDIX

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





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


               Prepared Witness Statements and Questions 
                             for the Record

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


        Prepared Statement of Senator Susan M. Collins, Chairman
    Good afternoon. I am pleased to welcome both new and returning 
Members to the Committee, and I am delighted that my good friend, 
Senator Casey, will serve as the Committee's new Ranking Member. My 
apologies that this hearing had to be delayed from when it was first 
scheduled on February 1st due to a long series of votes on the Senate 
floor.
    The Committee will continue its focus on three primary issues this 
Congress: retirement security; biomedical research investments for 
diseases like Alzheimer's and diabetes that disproportionately affect 
seniors; and financial schemes and other scams targeting older 
Americans--the subject of today's hearing.
    Last summer, an 81-year-old constituent came to my office in 
Portland, Maine, with an alarming story of deception and cruelty. A con 
artist claiming to be an agent of the Internal Revenue Service had just 
cheated him out of $8,000. He narrowly avoided losing $15,000 more.
    After reporting the crime to local police, my constituent, Philip 
Hatch, and his son came to my office. My staff gave him a copy of the 
Fraud Book that this Committee produced last year and a post card that 
we created with tips on avoiding scams. Mr. Hatch told us that the 
tactics described in the materials we provided were exactly those used 
by the scammer. If only he had received that information sooner, he 
might have recognized the scam and avoided losing his hard-earned 
savings.
    Mr. Hatch was very willing to testify today, but health issues 
prevent him from traveling. Instead, he graciously and courageously 
provided a video in order to tell his story. We will see that in a 
moment.
    This episode demonstrates two important points. First, the 
criminals who prey on seniors are relentless. They will harass seniors 
until they have drained every penny in their life savings.
    Second, this Committee's longstanding dedication to fighting fraud 
against seniors is raising awareness and prompting enforcement actions 
that are making a real difference. We must redouble our efforts to 
educate seniors, their families, and caregivers.
    The stakes are extremely high. According to the Government 
Accountability Office, America's seniors lose a staggering $2.9 billion 
each year to an ever-growing array of financial exploitation schemes 
and scams.
    Today's hearing coincides with the release of our Committee's 2017 
Fraud Book. Like the book we published last year, it lists the top 10 
scams being perpetrated against seniors, along with information on how 
to recognize, avoid, and report them. In both years, the IRS 
Impersonation Scam was the leading offender.
    These lists are the result of calls made to our Committee's toll-
free fraud hotline. In 2015, Hotline staff fielded more than 1,100 
calls. Last year, the Hotline's call volume doubled to more than 2,200. 
It is clear that our efforts are raising public awareness. More 
important, our efforts are producing real results.
    I look forward to the testimony of the Treasury Inspector General's 
Office today on recent evolutions in the IRS imposter scam, such as the 
demand for payment in iTunes gift cards, to which Mr. Hatch and many 
others have fallen victim. Raising awareness about the IRS scam is 
particularly timely, as we are now in the midst of tax filing season.
    Last May, thanks to the work of our hotline investigators, TIGTA 
arrested five individuals in connection with the IRS imposter scam. 
Federal authorities believe these suspects stole almost $3 million from 
more than 1,200 victims. In October, 56 individuals and five call 
centers in India were indicted in another case.
    In addition to producing criminal charges, these efforts are making 
it harder for criminals to find victims.
    I also look forward to hearing from the Federal Trade Commission on 
other scams targeting seniors, such as grant scams, counterfeit check 
scams, and romance scams, which is timely with yesterday being 
Valentine's Day.
    As our 2017 Fraud Book makes clear, while we are making progress, 
far too many victims are still losing money and, often, their 
retirement savings, to these criminals. Law enforcement, consumer 
protection, Area Agencies on Aging, and financial institutions play 
vital roles, but alert citizens are our first and best line of defense. 
I am proud of the Committee's work on this crucial issue to help 
seniors become more aware and informed, and to put criminals on notice 
that they will be stopped and brought to justice.
    I now turn to Senator Casey for his opening statement.
                               __________
   Prepared Statement of Senator Robert P. Casey Jr., Ranking Member
    Good afternoon. I am pleased to join Chairman Collins in convening 
this first hearing of the Special Committee on Aging for the 115th 
Congress. I am glad to take on the role of Ranking Member of this 
Committee at such a crucial time, knowing that the future of key 
programs for older Americans like Medicare and Medicaid are on the 
agenda of the new Administration. It is essential that we protect these 
vital programs for older Americans, and the Aging Committee has an 
important role to play in this work.
    For today's hearing, we have the opportunity to hear from expert 
witnesses on the challenging issue of combatting fraud and scams 
targeting older Americans. Experts testifying today include Diane Menio 
from the Pennsylvania senior advocacy organization CARIE, a group that 
works every day to help older Americans live with dignity. Diane is 
accompanied by Charlotte Kitler, a lawyer from Nanticoke, Pennsylvania 
who is volunteering in her retirement years to protect her peers from 
fraud through her work with the Senior Medicare Patrol. I look forward 
to their comments as well as the testimony from our agency experts.
    I'm also pleased to join with Senator Collins in releasing a 
Committee report detailing the top 10 scams targeting our Nation's 
seniors. This report is based on the experiences of more than 2,200 
individuals who contacted the Committee's Fraud Hotline over the past 
year. What we learned from these older Americans and their families not 
only provided us an opportunity to help individual citizens, but it 
also will inform the work of this Committee going forward. And, I am 
pleased to have joined with Senator Collins in reintroducing the 
Senior$afe Act last week. This important legislation both encourages 
financial institutions to disclose suspected exploitation of seniors 
when they see it and protects them from being sued for making these 
reports if they have appropriately trained their staffs and make good 
faith reports.
    In the Commonwealth of Pennsylvania, more than one-in-six residents 
is aged 65 or older. As a result, I know all too well how vulnerable 
older Americans can be to fraudsters and scam artists and other abuse. 
In fact, in 2015, over 22,000 cases of suspected elder abuse and 
neglect were reported to the Pennsylvania Department of Aging's 
protective services program.
    That is why, last Spring, I held a field hearing of this Committee 
in Wilkes-Barre, Pennsylvania to hear directly from my constituents--
both those affected by scams and those trying to prevent them. One 
constituent from Kingston Township told the heartbreaking story of scam 
artists attempting to steal the identify and use the credit cards of 
her husband of 43 years after his death. Also at the hearing, the 
Luzerne County District Attorney highlighted the most common type of 
scam happening in the county--the sweepstakes or lottery scam. This is 
one of the top 10 scams documented in the Committee's report and one 
that we will hear about from some of today's witnesses. Victims are 
promised lottery winnings if they just pay often sizable so-called 
``taxes and fees'' up-front. The D.A. recalled one older victim being 
scammed out of $85,000 in the hopes of retrieving $1 million in fake 
lottery winnings.
    Other common schemes include scammers impersonating IRS officials 
demanding payment of unpaid tax bills; those claiming to be computer 
support technicians to gain access to personal information stored on 
the computer under the guise of ``fixing'' it; or those claiming to be 
grandchildren in desperate need of a grandparents' money for bail or a 
hospital bill or some other emergency. While experts struggle to 
estimate the total financial impact of scams targeting seniors, mainly 
because it is so underreported, they know it adds up to nearly $3 
billion a year in lost savings--and potentially billions more. It isn't 
just money that is lost in these scams, it is also older Americans' 
sense of security and financial independence. It is outrageous that 
people who worked hard all of their lives are being targeted for their 
nest-eggs when they are at their most vulnerable. And, it is wrong that 
seniors still feel afraid to report these schemes. They should not be 
embarrassed or ashamed. They should know that we have their backs and 
are here to help them fight back.
    That is why enforcement is such a critical part of this discussion. 
While it may not be easy to track down these increasingly sophisticated 
scammers and their domestic and international networks and hold them 
accountable, we must do so for the safety and security of our parents 
and grandparents. I know that the tireless work of this Committee and 
the federal agencies here today has helped make progress toward this 
goal.
    In fact, the Chair and I applauded the Federal Trade Commission and 
the Justice Department settlement with Western Union in which the 
company admitted to criminal anti-money laundering violations that have 
disproportionately affected aging Americans. In some instances, Western 
Union employees were directly responsible and aided in the fraud by 
willfully ignoring warning signs. The $586 million settlement will be 
used to compensate victims of fraud where Western Union agents were 
complicit in the scams.
    But there is more work to do, and we will continue to use the 
spotlight of this Committee to both help consumers understand the 
threat and highlight the need for action. It is for this reason that I 
will continue to fight to ensure that the Consumer Financial Protection 
Bureau has the resources to help. The CFPB houses the only federal 
office solely focused on sharing financial information with seniors and 
educating seniors about how to prevent becoming the victim of fraud. 
Until recently, this office was led by former Pennsylvania Secretary of 
Aging, Nora Dowd Eisenhower.
    We also need to keep up the fight against health care fraud and 
abuse that we launched through the Affordable Care Act. In fact, the 
government has realized a record-breaking $10.7 billion in recoveries 
of health care fraud in the last three years. Thanks to the ACA, we 
have new tools like increased federal sentencing guidelines for health 
care fraud and enhanced screening for providers and suppliers who may 
pose a higher risk of fraud or abuse. And, the law provides an 
additional $350 million over 10 years to boost anti-fraud efforts. We 
also know that proposals to block grant Medicaid could present states 
with a significant barrier to addressing waste, fraud, and abuse in the 
program. Block grants could jeopardize funding for program integrity 
resources, as states would lose federal program integrity resources 
that currently go along with Medicaid matching dollars.
    I look forward to hearing from our witnesses about what more we can 
all be doing to fight fraud and abuse.
                               __________
                   Prepared Statement of Philip Hatch
    My name is Philip Hatch. I'm 81 years old, and I'm from Portland, 
Maine, born and raised.
    I received a telephone call. I answered the phone and the man said 
he was a representative from the Internal Revenue Service. I said what 
can I do to help you? He said, ``well we've gone through the records 
and there has been a mistake on your returns and you owe $5,988 and 
some odd cents.'' So, I said fine--tell me who I make the check out to 
and I'll mail it. He said ``well we can't do that. We have a warrant 
out for your arrest. The marshals will be in your house within the 
hour.'' I said well what would you like me to do to help resolve this? 
They said, ``you can go to CVS and get those iTunes cards and when you 
come back you can read the numbers off to us.'' I said this doesn't 
seem like a very professional way to do this. They said, ``well it's 
either that or the marshals are coming. If we do this I can tell them 
not to come.'' So I did. I went and got these little iTunes cards and 
read them off to them and they said ``alright you can't tell anybody 
about this.'' I said what do you mean I can't tell anybody about this? 
I'm gonna tell the guy who does my tax returns. I'm a little mad at 
him. He made a mistake. He said, ``No. Don't do that. It will all be 
taken care of.'' This started at four in the afternoon and went on to 
eight o'clock at night. They called me the next day and said there was 
mistake. I said what do you mean a mistake? It wasn't $5,900 something 
dollars it was $23,000. They had someone call me on the regular phone 
who said he was a Portland Police Officer and that they have a local 
warrant out for my arrest. So I put my son on the phone and he says 
``who's this?'' They asked who this was and he gave them a phony name 
and said he was an FBI agent and they said ``whoops'' and they hung up. 
That was the end of it. But I had already sent in $8,000 to these 
people.
    Being in the military and working for the government--you know when 
the government calls up you say aye aye sir. What do you need? Can I 
help you? Okay.
    Maybe if I hadn't had that background, I wouldn't have been so 
cooperative. But I was mad--upset that I was taken in. Just give me 
five minutes in a room alone with these people and I'd be happy.
    All I can say is just be wary. Just be careful. When it comes to 
someone going after your money just say `I'll think about it tonight 
and get back to you tomorrow and contact someone about it.'''
                               __________
                               
                               
                               
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
                           
                               
                               
                               
                       Prepared Statement Lois Greisman



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


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


                  Additional Statements for the Record

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



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


 

                                  [all]