[Congressional Record Volume 143, Number 148 (Wednesday, October 29, 1997)]
[Senate]
[Pages S11351-S11352]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. DURBIN:
  S. 1340. A bill entitled the ``Telephone Consumer Fraud Protection 
Act of 1997.''; to the Committee on the Judiciary.


          the telephone consumer fraud protection act of 1997

  Mr. DURBIN. Mr. President, I rise today to introduce the Telephone 
Consumer Fraud Criminal Penalties Act of 1997. This measure will 
finally allow us to strike back against ``slamming,'' the practice of 
changing a telephone customer's long-distance carrier without the 
customer's knowledge or consent.
  Slamming is the Federal Communications Commission's largest source of 
consumer complaints. In 1995 and 1996, more than one-third of the 
consumer complaints filed with the FCC's Common Carrier Bureau involved 
slamming. Last year 16,000 long-distance telephone consumers filed 
slamming complaints with the FCC. Since 1994, the number of slamming 
complaints has tripled. Yet, this is only the tip of the iceberg-- the 
Los Angeles Times reports that more than 1 million American telephone 
consumers have been slammed in the last 2 years.
  In my home State of Illinois slamming was the No. 1 source of 
consumer complaints to the attorney general's office in 1995, and the 
No. 2 source of complaints in 1996. Slamming is obviously a serious 
problem that must be stopped.
  Slamming is not merely an inconvenience or a nuisance. It is an act 
of fraud that costs long-distance telephone consumers millions of 
dollars a year and robs them of the right to contract. The Telephone 
Consumer Fraud Criminal Penalties Act will now ensure that slammers are 
held accountable for their fraudulent acts.
  My measure will help stamp out slamming in two ways:
  First, the Telephone Consumer Fraud Criminal Penalties Act creates 
criminal fines and jail time for repeat and willful slammers. Slamming 
takes choices away from consumers without their knowledge and distorts 
the long distance competitive market by rewarding companies that engage 
in fraud and misleading marketing practices. This measure's criminal 
penalties will guarantee that slammers can no longer act with impunity.
  Second, the Telephone Consumer Fraud Criminal Penalties Act charges 
the Attorney General with the duty of conducting a study on the 
fraudulent and criminal behavior of telecommunications carriers and 
their agents in the

[[Page S11352]]

solicitation, marketing, and assignment of telecommunication services. 
The Attorney General's study will examine the fraudulent methods by 
which a telecommunications consumer's local, long distance, and other 
telecommunications services are changed without the consumers knowledge 
or consent. Through this study, Congress will gain a better 
understanding of how slammers operate. With this knowledge we will be 
able to draft a well crafted, all encompassing law that will finally 
put a lid on slamming.
  Thank you, Mr. President, for the opportunity to introduce this 
important initiative. I hope my colleagues will join with me and 
support the Telephone Consumer Fraud Criminal Penalties Act in order to 
protect the rights of telephone consumers.
  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. 1340

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Telephone Consumer Fraud 
     Protection Act of 1997.''

     SEC. 2. CRIMINAL PENALTIES.

       Title 18 of the United States Code is amended in the 
     appropriate place to provide the following.
       (A) Persons.--Any person who submits to a subscriber a 
     request for a change in a provider of telephone exchange 
     service or telephone toll service in willful violation of the 
     procedures established in 47 CFR Sec. Sec. 64.1100 or 
     64.1150:
       (i) shall be fined not more than $1,000, imprisoned not 
     more than 30 days, or both for the first offense; and
       (ii) shall be fined not more than $10,000, imprisoned not 
     more than 9 months, or both, for any subsequent offense.
       (B) Telecommunications Carriers.--Any telecommunications 
     carrier who submits to a subscriber a request for a change in 
     a provider of telephone exchange service or telephone toll 
     service, or executes such a change, in willful violation of 
     47 CFR Sec. Sec. 64.1100 or 64.1150:
       (i) shall be fined not more than $50,000 for the first such 
     conviction; and
       (ii) shall be fined not more than $200,000 for any 
     subsequent conviction.

     SEC. 3. A STUDY BY THE ATTORNEY GENERAL.

       The Attorney General shall conduct a study and report to 
     Congress on the fraudulent and criminal behavior of 
     telecommunications carriers and their agents in the 
     solicitation, marketing, and assignment of wire services. The 
     Attorney General's study shall examine the fraudulent methods 
     by which a telecommunications consumer's local, long 
     distance, and other telecommunications services are changed 
     without her or his knowledge or consent. The Attorney 
     General's study shall also examine the negative impact and 
     costs that such fraudulent activity is having on consumers 
     and the marketplace.
                                 ______