[Congressional Record Volume 144, Number 72 (Friday, June 5, 1998)]
[Senate]
[Pages S5699-S5700]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. CAMPBELL:
  S. 2141. A bill to require certain notices in any mailing using a 
game of chance for the promotion of a product or service, and for other 
purposes; to the Committee on Governmental Affairs.


                   honesty in sweepstakes act of 1998

  Mr. CAMPBELL. Mr. President, today I introduce the Honesty in 
Sweepstakes Act of 1998.
  Every day millions of senior citizens and other innocent consumers 
receive sweepstakes announcements that boldly announce that they have 
just won millions of dollars or some other prize, perhaps a luxury 
cruise, when in fact they have not. Millions of Americans also receive 
cashier's check look-alikes, made out to their name, and written for 
thousands of dollars, as a ploy to get them to purchase some product or 
service. But upon close scrutiny, these cashier's check look-alikes are 
actually worthless.
  These two tactics are some of the most pervasive deceptive direct 
mail marketing ploys being used today. Theses slick direct mail 
marketing ploys prey directly upon the better elements of the American 
character: optimism, good nature, trust, and natural tendency to accept 
things at face value.
  The recent increase of news reports detailing how American consumers 
are being deliberately misled into believing that they have just won a 
huge prize, only to find out later that they were taken advantage of, 
clearly shows that the problem is getting worse. All across our 
country, families' home mail boxes are being stuffed with increasingly 
deceptive direct mail marketing ploys, and senior citizens are 
particulary vulnerable to these deceptive tactics.
  Something needs to be done to restore honesty in sweepstakes.
  This legislation has two key provisions. The first ensures accuracy 
and honesty in direct mail sales promotions that use sweepstakes or 
other games of chance to entice consumers to buy their products or 
services. The second provision promotes honest forthrightness when 
cashier's check look-alikes are used in direct mail sales promotions. 
Together, this legislation's two key provisions will benefit American 
consumers, the U.S. Postal Service, and the direct mail marketing 
industry.
  First, my bill will protect American consumers from deceptive 
marketing practices. It will accomplish this by requiring that direct 
mail marketers provide consumers with honest, up-front and clear 
disclosure of what is being sent to their mail boxes. These new 
disclosure standards will enable consumers to quicky separate mail that 
is truly important from mail that is deceptively designed to look 
important by masquerading as something that it is not.
  Second, the bill helps the Postal Service do its job better. This 
bill will strengthen the Postal Service's efforts by enabling it to 
halt the delivery of deceptive mass mailings. This legislation will 
reassure the American people that the Postal Service is on their side, 
and not on the side of those who would

[[Page S5700]]

use the Postal Service to deliver deceptive marketing ploys.
  Finally, this legislation will benefit the direct mail marketing 
industry as a whole. It will enhance the public image of the majority 
of direct mail marketers that are honest by compelling companies that 
use deceptive marketing practices, and whose activities taint the 
entire industry, to either clean up their act or get out. For many 
years, direct mail marketers have successfully sold their products 
without resorting to deception. Let's return to those days.
  The Honesty in Sweepstakes Act is built on a solid foundation of 
precedents. The key principle for the sweepstakes portion of this 
legislation is based on the way in which lotteries clearly disclose 
important information, like the total chances of winning. As for 
achieving the same goal for the printed materials used in direct mail 
marketing, this honesty is achieved through requiring the disclosure to 
be printed on top and in easy to read font sizes. It is also similar to 
food labeling, letting you know what is inside the product. The 
cashier's check look-alike portion of this bill is founded on precedent 
in current law that allows the Postal Service to dispose of, or 
otherwise refuse to deliver, government look-alike materials. My bill 
simply expands this current statutory provision to include cashier's 
check look-alikes.
  This bill addresses deceptive sweepstakes in two important ways. 
First, it requires an announcement to be clearly printed on the face of 
the envelope to state that ``This is a sweepstakes. You have not 
automatically won.'' This announcement must be clearly printed in a 
large 16 point font, or in an even larger font in some circumstances, 
so that it is crystal clear and easy for everyone to read. Many of our 
nation's seniors will especially benefit from this large font size 
requirement. Second, this bill requires that important information be 
printed clearly on the top of the first page of enclosed material, 
including the chances of winning the big prize being promoted and that 
no purchase is necessary to participate. For cashier check look-alikes, 
this bill calls for a 16 point font notice that ``This is not a check. 
This has no cash value.'' The days of deceptive marketers burying all 
of the important information and other disclaimers in fine print are 
numbered.
  Enforcement is triggered by the consumers themselves. When people 
receive sweepstakes and cashier's check look-alikes that do not meet 
the honesty guidelines laid out in this bill, they should contact the 
Post Office and register a complaint. These consumer complaints can 
then trigger a postal investigation of the materials in question. If 
the Postal Service finds that the materials do not live up to the 
Honesty in Sweepstakes guidelines, the Postal Service can then dispose 
of the mail accordingly, either by disposing of it or returning it to 
the sender. As a result, marketers who are not complying with the 
Honesty in Sweepstakes standards will then take a loss on the 
production and postage costs associated with that mailing. Needless to 
say, the company will quickly learn its lesson and produce marketing 
materials that are more forthright and honest.
  I have consulted with the Attorneys General of both my home state of 
Colorado, and of the state of Florida, which is in the forefront of the 
effort to fight deceptive sweepstakes practices. These two offices 
expressed support for both this bill's goals and new approach. The 
Attorneys General were also glad to hear that this bill contains a 
clause stating that nothing in this bill will preempt state law. This 
important clause gives each of our respective states the freedom to 
enact its own additional guidelines as it sees fit. I appreciate the 
helpful feedback and support these two states' Attorneys General have 
shown.
  For too long, too many of our senior citizens and other innocent 
consumers have been victimized by deceptive sweepstakes and cashier's 
check look-alikes. This bill will end this practice, and I urge my 
colleagues to support its passage.
  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. 2141

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

     SECTION 1. NOTICE REQUIRED ON MAILINGS USING GAMES OF CHANCE.

       (a) Short Title.--This Act may be cited as the ``Honesty in 
     Sweepstakes Act of 1998''.
       (b) Notice Required.--Section 3001 of title 39, United 
     States Code, is amended--
       (1) by redesignating subsections (j) and (k) as subsections 
     (k) and (l), respectively; and
       (2) by inserting after subsection (i) the following:
       ``(j)(1) Matter otherwise legally acceptable in the mails 
     that constitutes a solicitation or offer in connection with 
     the sales promotion for a product or service that uses any 
     game of chance of winning anything of value (including any 
     sweepstakes) shall not be carried or delivered by mail, and 
     may be disposed of as the Postal Service directs, unless such 
     matter in conspicuous and legible type in contrast by 
     typography, layout, or color with other printing on its face, 
     in accordance with regulations which the Postal Service shall 
     prescribe--
       ``(A) bears on the envelope the following notice: ``This is 
     a game of chance (or sweepstakes, if applicable). You have 
     not automatically won.'', or a notice to the same effect in 
     words which the Postal Service may prescribe; and
       ``(B) bears on the top of the first page of enclosed 
     printed matter the following notice: `This is a game of 
     chance (or sweepstakes, if applicable). You may not have 
     automatically won. Your chances of winning are (insert 
     applicable mathematical probability). No purchase is required 
     either to win a prize or enhance your chances of winning a 
     prize.', or a notice to the same effect in words which the 
     Postal Service may prescribe.
       ``(2) Matter otherwise legally acceptable in the mails that 
     constitutes a solicitation or offer in connection with the 
     sales promotion for a product or service that uses any matter 
     resembling a negotiable instrument shall not be carried or 
     delivered by mail, and may be disposed of as the Postal 
     Service directs, unless such matter bears on the face of the 
     negotiable instrument in conspicuous and legible type in 
     contrast by typography, layout, or color with other printing 
     on its face, in accordance with regulations which the Postal 
     Service shall prescribe the following notice: `This is not a 
     check (or negotiable instrument). This has no cash value.', 
     or a notice to the same effect in words which the Postal 
     Service may prescribe.
       ``(3) The notices described under paragraphs (1) and (2) 
     shall be printed in a font which is the larger of--
       ``(A) 80 percent or more of the size of the largest font 
     otherwise used in the matter; or
       ``(B) a 16-point font.
       ``(4) Nothing in this subsection shall preempt any State 
     law that regulates advertising or sales of goods and services 
     associated with any game of chance.''.
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