[Congressional Record Volume 143, Number 115 (Thursday, September 4, 1997)]
[Senate]
[Page S8827]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. D'AMATO:
  S. 1148. A bill to amend title 49, United States Code, to require the 
forfeiture of counterfeit access devises and device-making equipment; 
to the Committee on the Judiciary.


               THE COUNTERFEIT ACCESS DEVICES ACT OF 1997

  Mr. D'AMATO. Mr. President, I rise today to introduce legislation 
which will strike a blow against counterfeiters and other criminals who 
commit cellular telephone fraud and credit card fraud.
  These criminal activities cost their respective industries hundreds 
of millions of dollars annually, and these costs are passed down to 
consumers who use credit cards and cellular telephones. The cellular 
telephone industry alone loses $650 million each year due to 
counterfeit or cloned telephone. The credit card industry faces a 
similar problem.
  The criminals who perpetrate these frauds use specialized equipment 
to clone cell phones and credit cards to create phony copies which can 
be sold on the street or used to rack up thousands of dollars in 
unauthorized credit card purchases and telephone calls. There is no 
legitimate reason for an individual to possess this special equipment 
used to create these phony copies. This equipment is only useful to 
create counterfeit credit cards and cell phones.
  Under current law, this equipment is actually returned to the 
criminal after he serves his sentence. The equipment is frequently used 
again to commit the same crimes over and over. The Government cannot 
confiscate the equipment without a separate expensive and time-
consuming forfeiture proceeding.
  Mr. President, it is preposterous that the Government must return the 
tools used to commit these crimes to criminals, even if they are 
convicted. These criminals are exploiting a loophole in the Federal 
forfeiture laws. My bill will close this loophole.
  My bill would amend title 49 of the United States Code to make this 
equipment, as well as the counterfeit credit cards and telephones 
themselves, contraband. This designation would make it a Federal crime 
to possess these items. My bill would also require that these items 
must not be returned to the criminals.
  Mr. President, these crimes take a tremendous toll on consumers whose 
telephones and credit cards are cloned by this equipment. By the time 
the consumer discovers that his or her telephone or credit card has 
been copied, the criminals usually have racked up thousands of dollars 
in unauthorized charges. This can have a devastating effect on 
consumers' credit ratings, rendering them unable to purchase a car or 
home or start a business. These problems can take years to correct.
  Last Congress, I introduced a similar bill, S. 1380. Unfortunately, 
the session ended before Congress was able to act. However, this bill 
is not without precedent. A similar measure was passed last year 
regarding counterfeit videos and music. These items are now considered 
contraband under the new law. Industry leaders and law enforcement 
authorities enthusiastically support this legislation.
  Mr. President, the Government must stop unwittingly aiding criminals 
to swindle hundreds of millions of dollars at the expense of consumers 
and the cellular telephone and credit card industries. My bill would 
close this outrageous loophole and help law enforcement crack down on 
these brazen criminals.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1148

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

     SECTION 1. FORFEITURES RELATING TO COUNTERFEIT ACCESS 
                   DEVICES.

       Section 80302(a) of title 49, United States Code, is 
     amended--
       (1) in paragraph (5), by striking ``or'' at the end;
       (2) in paragraph (6), by striking the period at the end and 
     inserting ``; or''; and
       (3) by adding at the end the following:
       ``(7) a counterfeit access device or any device-making 
     equipment (as those terms are defined in section 1029 of 
     title 18).''.
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