[Congressional Record Volume 148, Number 105 (Monday, July 29, 2002)]
[Extensions of Remarks]
[Pages E1468-E1469]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   H. RES. 443: TO EXPRESS THE SUPPORT OF THE HOUSE FOR PROGRAMS AND 
  ACTIVITIES TO PREVENT PERPETRATORS OF FRAUD FROM VICTIMIZING SENIOR 
                                CITIZENS

                                 ______
                                 

                          HON. DANNY K. DAVIS

                              of illinois

                    in the house of representatives

                         Friday, July 26, 2002

  Mr. DAVIS of Illinois. Mr. Speaker, I rise today to speak about an 
epidemic. It's not one that you'll read about in a medical book, and 
unfortunately, it's probably not one that a lot of people know enough 
about, in general. But, we need to respond to this problem, just as we 
would if it were a public health situation--by launching a vigorous 
public awareness campaign.
  Let me give some examples of what I'm talking about:
  Two individuals pleaded guilty to charges of mail fraud in connection 
with a scheme soliciting elderly individuals to invest in silver and 
gold coins. The victims, who were promised a high rate of return on 
their investments, were coerced into paying 200 to 300 percent more 
than the coins were worth.
  A group defrauded 200 elderly investors nationwide of an estimated 
$34 million from the offer and sale of fraudulent promissory notes and 
other fraudulent securities. The majority of the victims were senior 
citizens who were convinced to liquidate safe retirement accounts and 
transfer those funds to risky investments.
  An independent insurance agent obtained over $508,000 from twelve 
senior citizens whom he promised a 10 percent return on their money in 
an investment opportunity. None of the funds were ever invested.
  Elderly victims were falsely told that bond companies were in 
possession of a $25,000 bond in the name of the victims, which they 
could receive after they paid the bond companies a fee ranging from 
$100 to $3,000 for ``research'' or ``paperwork.'' None of the victims 
ever received a valuable bond, but elderly victims sent the bond 
companies approximately $1.6 million.

[[Page E1469]]

  I wish these anecdotes were isolated incidents, but unfortunately 
they are just the tip of the iceberg.
  In fiscal year 2001 alone, the U.S. Postal Inspection Service 
responded to 66,000 mail fraud complaints, arrested 1,691 mail fraud 
offenders, convicted 1,477 of such offenders, and initiated 642 civil 
or administrative actions, recovering over $1.2 billion in court 
ordered restitution payments. If these figures weren't distressing 
enough, the number of complaints is on the rise. The Postal Inspection 
Service has already responded to 68,000 mail fraud complaints this year 
to date--pointing to a possible 27 percent increase in complaints by 
the end of this fiscal year.
  According to AARP:
  ``Older Americans are the targets of a new kind of criminal. This 
criminal holds you up in your own home, but not with a gun. This 
criminal's weapon of choice is the telephone.
  ``There may be more than 10,000 fraudulent telemarketing operations 
calling hundreds of thousands of American consumers every day. Older 
Americans are a prime target of these crooks . . .
  ``. . . 56 percent of the names on `mooch lists' (what fraudulent 
telemarketers call their lists of most likely victims) were aged 50 or 
older.
  ``Many of the older people preyed upon by dishonest telemarketing 
companies are well-educated, with above-average incomes, and they are 
socially active in their communities.''
  Therefore, the sales pitches these companies use are appropriately 
sophisticated. They include: ``phony prizes, illegal sweepstakes, sham 
investments, crooked charities, and `recovery rooms' where victims are 
scammed again by the telemarketers with promises that, for a fee, they 
will help them recover the money they have lost.''
  The National Consumers League, the oldest nonprofit consumer 
organization in the United States, reports that: ``It's estimated that 
there are 14,000 illegal telemarketing operations bilking U.S. citizens 
of at least $40 billion dollars annually.'' They believe that ``[t]he 
first step in helping older people who may be targets of fraud is to 
convince them that the person on the other end of the line could be a 
crook!''
  In order to ``to express the support of the House for programs and 
activities to prevent perpetrators of fraud from victimizing senior 
citizens,'' and ``to educate and inform the public, senior citizens, 
their families, and their caregivers about fraud perpetrated through 
mail, telemarketing, and the Internet,'' please join Representative 
John McHugh, and me in passing House Resolution 443.
  Our colleagues in the Senate have passed a resolution designating the 
week beginning August 25, 2002 as ``National Fraud Against Senior 
Citizens Week.'' We will be able to collaborate with them, the U.S. 
Postal Inspection Service, and numerous advocacy groups in raising 
public awareness about this epidemic of fraud and deception against 
senior citizens and hopefully prevent future incidents of fraud.

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