[Congressional Record Volume 153, Number 49 (Wednesday, March 21, 2007)]
[House]
[Pages H2790-H2793]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 PREVENTING HARASSMENT THROUGH OUTBOUND NUMBER ENFORCEMENT (PHONE) ACT 
                                of 2007

  Ms. LINDA T. SANCHEZ of California. Mr. Speaker, I move to suspend 
the rules and pass the bill (H.R. 740) to amend title 18, United States 
Code, to prevent caller ID spoofing, and for other purposes.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                                H.R. 740

       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 ``Preventing Harassment 
     through Outbound Number Enforcement (PHONE) Act of 2007''.

     SEC. 2. CALLER ID SPOOFING.

       (a) In General.--Chapter 47 of title 18, United States 
     Code, is amended by adding at the end the following:

     ``Sec. 1040. Caller ID spoofing

       ``(a) Offense.--Whoever, in or affecting interstate or 
     foreign commerce, knowingly uses or provides to another--
       ``(1) false caller ID information with intent to defraud; 
     or
       ``(2) caller ID information pertaining to an actual person 
     without that person's consent and with intent to deceive the 
     recipient of a call about the identity of the caller;

     or attempts or conspires to do so, shall be punished as 
     provided in subsection (b).
       ``(b) Punishment.--Whoever violates subsection (a) shall--
       ``(1) if the offense is committed for commercial gain, be 
     fined under this title or imprisoned not more than 5 years, 
     or both; and
       ``(2) be fined under this title or imprisoned not more than 
     one year, or both, in any other case.
       ``(c) Law Enforcement Exception.--It is a defense to a 
     prosecution for an offense under this section that the 
     conduct involved was lawfully authorized investigative, 
     protective, or intelligence activity of a law enforcement 
     agency of the United States, a State, or a political 
     subdivision of a State, or of an intelligence agency of the 
     United States, or any activity authorized under chapter 224 
     of this title.
       ``(d) Forfeiture.--
       ``(1) In general.--The court, in imposing sentence on a 
     person who is convicted of an offense under this section, 
     shall order that the defendant forfeit to the United States--
       ``(A) any property, real or personal, constituting or 
     traceable to gross proceeds obtained from such offense; and
       ``(B) any equipment, software or other technology used or 
     intended to be used to commit or to facilitate the commission 
     of such offense.
       ``(2) Procedures.--The procedures set forth in section 413 
     of the Controlled Substances Act (21 U.S.C. 853), other than 
     subsection (d) of that section, and in Rule 32.2 of the 
     Federal Rules of Criminal Procedure, shall apply to all 
     stages of a criminal forfeiture proceeding under this 
     section.
       ``(e) Definitions.--In this section--
       ``(1) the term `caller ID information' means information 
     regarding the origination of the telephone call, such as the 
     name or the telephone number of the caller;
       ``(2) the term `telephone call' means a call made using or 
     received on a telecommunications service or VOIP service;
       ``(3) the term `VOIP service' means a service that--
       ``(A) provides real-time 2-way voice communications 
     transmitted using Internet Protocol, or a successor protocol;
       ``(B) is offered to the public, or such classes of users as 
     to be effectively available to the public (whether part of a 
     bundle of services or separately); and
       ``(C) has the capability to originate traffic to, or 
     terminate traffic from, the public switched telephone network 
     or a successor network;
       ``(4) the term `State' includes a State of the United 
     States, the District of Columbia, and any commonwealth, 
     territory, or possession of the United States; and
       ``(5) a term used in a definition in this subsection has 
     the meaning given that term in section 3 of the 
     Communications Act of 1934 (47 U.S.C. 153).''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 47 of title 18, United States Code, is 
     amended by adding at the end the following new item:

``1040. Caller ID spoofing.''.

     SEC. 3. OTHER SPECIFIED UNLAWFUL ACTIVITIES FOR MONEY 
                   LAUNDERING.

       (a) Fraud and Related Activity in Connection With 
     Electronic Mail.--Section 1956(c)(7)(D) of title 18, United 
     States Code, is amended by inserting ``section 1037 (Fraud 
     and related activity in connection with electronic mail),'' 
     after ``1032''.
       (b) Caller ID Spoofing.--Section 1956(c)(7)(D) of title 18, 
     United States Code, is amended by inserting ``section 1040 
     (Caller ID spoofing),'' before ``section 1111''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentlewoman from 
California (Ms. Linda T. Sanchez) and the gentleman from Texas (Mr. 
Smith) each will control 20 minutes.
  The Chair recognizes the gentlewoman from California.

[[Page H2791]]

                             General Leave

  Ms. LINDA T. SANCHEZ of California. Mr. Speaker, I ask unanimous 
consent that all Members have 5 legislative days to revise and extend 
their remarks and include extraneous material on the bill under 
consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentlewoman from California?
  There was no objection.
  Ms. LINDA T. SANCHEZ of California. Mr. Speaker, I yield myself such 
time as I may consume.
  I rise in strong support of H.R. 740, the Preventing Harassment 
Through Outbound Number Enforcement (PHONE) Act of 2007.
  I would like to thank Chairman Conyers for his leadership in moving 
this bill through the committee process and to the floor on a 
bipartisan basis, and also commend Mr. Scott and the leadership and 
assistance of the full committee Ranking Member Smith and subcommittee 
Ranking Member Forbes, along with that of the chief sponsor of spoofing 
legislation in the last Congress, Tim Murphy, in developing and moving 
this bill to the floor.
  H.R. 740 is aimed at the practice that has come to be known as 
spoofing. To some, that name might conjure up harmless pranks, but 
spoofing is very serious. Spoofing occurs when a caller uses caller ID 
information to hide the caller's true identity in order to commit fraud 
or some other abusive act.
  One of the witnesses at the hearing on the predecessor bill last 
Congress was Phil Kiko, the Judiciary Committee's chief counsel at the 
time. He had been a victim of caller ID spoofing when his home phone 
number was left falsely as the caller ID on numerous calls. Phil and 
his family were understandably irritated at the numerous calls from 
people mistakenly calling him back, and it could have been much worse.
  Spoofing is also often used to commit identity theft. Call recipients 
sometimes are tricked into divulging personal and private information 
under the mistaken belief that the call is legitimate. For example, the 
AARP has reported cases in which people received calls claiming falsely 
that they had missed jury duty. They were told that to avoid 
prosecution they needed to provide their Social Security number and 
other personal information. The caller ID information that appeared on 
their phones was from the local courthouse, so they assumed that the 
caller was telling the truth.
  H.R. 740 is intended to help protect consumers from harassment, 
identity theft and other privacy intrusions.
  Recently, the technology needed to spoof has become readily available 
either through the purchase of Internet telephone equipment or through 
Web sites specifically set up to spoof. For example, Voice over 
Internet Protocol equipment can easily be configured to populate the 
caller ID field with information of the user's choosing. Some of the 
technology can block any back technology, such as Star 69. In addition, 
the bill contains a forfeiture provision allowing for the forfeiture of 
equipment used and proceeds gained by criminals in call spoofing.
  Finally, section 3 of the bill has a provision which adds call 
spoofing to the list of unlawful activities associated with money 
laundering. Existing law provides that comparable crimes, such as 
violations of the Computer Fraud and Abuse Act, constitutes specified 
unlawful activities for the purpose of the money laundering statute.
  Not all use of fake caller ID information is considered spoofing. 
When you receive a call from a U.S. House of Representatives number on 
an outside line, for example, the number that appears on your caller ID 
is a fictitious number to protect the security of House Members and 
staff. False caller ID information is also used legitimately for 
certain law enforcement purposes and by some businesses as well, and 
these nonmalicious users are not prohibited by the bill.
  The bill we were considering last Congress would have made even this 
nonabusive fake caller ID use illegal. That bill also failed to make a 
distinction in penalties for spoofing that does not involve fraud or 
gain, such as the Phil Kiko case.
  Further, comments from the Department of Justice were not available 
when last year's bill was being developed. This is why I opposed the 
bill last year, though I was in support of the concept of the bill.
  We have constructed a bill that makes fraudulent commercial use of 
caller ID information a felony, with fines and imprisonment of up to 5 
years. This commercial motive would require the use of false caller ID 
information; that is, caller ID information that is not your own. The 
bill also makes abusive use of caller ID information without fraudulent 
commercial motives a misdemeanor, such as the Phil Kiko situation. 
Finally, the bill exempts use of nonabusive fake ID information.
  The Subcommittee on Crime, Terrorism and Homeland Security held a 
hearing and markup on the bill in February and reported it favorably to 
the full committee. At the subcommittee hearing, the DOJ provided 
testimony and recommendations which we did not have a chance to fully 
consider by the time of full committee markup. Ranking Member Forbes 
and Mr. Scott agreed to work together on considering those 
recommendations in a continuation of the fully bipartisan effort under 
which this bill had been developed.
  After meeting with representatives of DOJ, they have revised the bill 
as reported out of committee to clarify the offense and punishment 
language in the bill. The change makes clear that felony penalties are 
reserved for egregious violations committed with intent to wrongfully 
obtain anything of value. They also made other technical changes to the 
bill for its introduction on the floor.
  H.R. 740 is important and helpful legislation for preventing identity 
theft and other abuses of phone technologies. Accordingly, I urge my 
colleagues to support the bill.
  Mr. Speaker, I reserve the balance of my time.

                              {time}  1800

  Mr. SMITH of Texas. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, I rise in support of H.R. 740, the Preventing Harassment 
Through Outbound Number Enforcement Act, or PHONE Act, and I thank 
Chairman Conyers and my colleagues on the other side of the aisle for 
their support of this bill which unanimously passed the House at the 
end of the 109th Congress.
  Mr. Speaker, a new type of fraud known as ``spoofing'' is becoming 
more prevalent. Spoofing involves masking one's caller ID information 
to facilitate a fraudulent telephone call to the recipient. Those who 
engage in spoofing use incorrect, fake or fraudulent caller 
identification to hide their identity, and then obtain personal 
information from the victim.
  Call recipients unwittingly divulge their names, addresses, or Social 
Security numbers under the mistaken belief that the caller represents a 
bank, a credit card company, or even a court of law.
  Spoofing is not simply annoying; it is the latest tactic for 
committing identity theft and other types of fraud that costs victims 
thousands and sometimes hundreds of thousands of dollars.
  Spoofing not only victimizes the phone call recipient, but also 
invades the privacy of those individuals whose caller ID is used to 
mask the fraudulent calls. To address this, H.R. 740 specifically 
prohibits the use of an actual person's caller ID information for 
spoofing.
  Although the technology needed to spoof has been available for some 
time, it previously required special equipment and knowledge to use the 
masking technology.
  Recently, this technology has become more accessible either through 
the purchase of Internet telephone equipment or through Web sites 
specifically set up for spoofing.
  These Web sites claim to protect one's privacy. However, the use of 
this technology has been linked to fraud, prank phone calls, political 
attacks, and telemarketers' attempts to avoid ``do not call'' 
restrictions.
  Additionally, calling cards can be purchased or accounts set up to 
facilitate multiple telephone calls. One of the greatest concerns 
related to spoofing is the use of the technology by criminals to 
mislead law enforcement officials and evade prosecution.
  H.R. 740 addresses these concerns by creating a new Federal crime to 
prohibit the modification of caller ID with

[[Page H2792]]

the intent to deceive the recipient of a telephone call as to the 
identity of the caller.
  The bill imposes a fine and/or a prison term of up to 5 years for 
violations. However, the legislation does not affect legally available 
blocking of caller ID technology, or lawfully authorized activities of 
law enforcement or intelligence agencies.
  This legislation will help deter telephone fraud, protect consumers 
from harassment, and protect consumers and their personally 
identifiable information from identity thieves. I urge my colleagues to 
support this bipartisan legislation.
  Mr. Speaker, I reserve the balance of my time.
  Ms. LINDA T. SANCHEZ of California. Mr. Speaker, I yield such time as 
he may consume to the author of the bill, the gentleman from Virginia 
(Mr. Scott).
  Mr. SCOTT of Virginia. Mr. Speaker, the PHONE Act is a strong bill 
that has gained bipartisan support. Members on both sides of the aisle 
have agreed that we need urgent reforms to protect privacy rights and 
to crack down on identity theft. With over 10 million Americans 
affected by some form of identity theft each year, we need to tackle 
this issue at every possible level.
  Spoofing is one form of identity theft in which criminals coax 
victims into giving up their most sensitive personal information by 
making it appear that a call is coming from a legitimate institution 
such as a bank. Misleading caller ID information also allows a spoofer 
to cause a victim to accept a call they otherwise might have avoided, 
leading to harassment and further privacy intrusions. Advances in 
technology such as Voice-Over-Internet-Protocol have made caller ID 
spoofing easy and readily available.
  H.R. 740 includes a number of important provisions to fight spoofing. 
The legislation creates a new Federal crime to prohibit using or 
providing false caller ID information with the intent to wrongfully 
obtain something of value. The section also prohibits using or 
providing the caller ID for information of an actual person without his 
or her consent and with the intent to deceive the recipient. It 
correctly targets spoofing done to perpetuate financial fraud, and 
reserves harsh punishment for such crimes, including felony penalties 
of up to 5 years in prison.
  In addition, the bill significantly improves the tools available to 
law enforcement to fight noncommercial spoofing while preserving the 
legitimate uses of the technology. For example, women's shelters may 
use misleading caller ID numbers, and many businesses do if they are 
calling from one of many lines. They may want the caller ID information 
to just reflect the main line. The bill does not infringe on these 
instances because the caller would not possess the requisite intent to 
defraud or deceive.
  Finally, the bill is narrowly tailored to permit caller ID blocking 
in which one prevents one's number from being known at all. Caller ID 
blocking is not used to mislead because a person knows he is not 
getting any number and it has been a standard telephone device for many 
years.
  In sum, the PHONE Act will deter telephone fraud, protect consumers 
from harassment, and will enhance protection of sensitive personal 
information.
  Mr. Speaker, let me conclude by saying this started as bipartisan 
legislation and has continued. The information was brought to us when 
the chief Republican counsel on the committee, Phil Kiko, received such 
harassment because his number had been used by somebody else making 
annoying calls. He got called back because his number was appearing as 
the caller ID.
  Mr. Murphy introduced the bill last year and we have worked to 
improve the bill and have made significant improvements since last 
year. Chairman Conyers, Ranking Member Smith, and Ranking Member 
Forbes, we all worked very closely together to make sure that we could 
have the best product possible. I urge my colleagues to join together 
and pass the legislation.
  Mr. SMITH of Texas. Mr. Speaker, I yield 2 minutes to the gentleman 
from Virginia (Mr. Goodlatte) who is a member of the Intellectual 
Property Subcommittee of the Judiciary Committee and who is chairman of 
the House Republican High-Tech Working Group, and who is also the 
ranking member of the House Agriculture Committee.
  Mr. GOODLATTE. Mr. Speaker, I thank the gentleman for his leadership 
on the Judiciary Committee and on this legislation, and I also thank 
Chairman Conyers and Subcommittee Chairman Scott, my colleague from 
Virginia, for their work on this legislation, as well as Congressman 
Murphy and Congressman Forbes, and I rise in strong support of H.R. 
740, the Preventing Harassment Through Outbound Number Enforcement, or 
PHONE, Act.
  Consumer fraud and identity theft are serious problems facing our 
citizens today. While technology has provided access to vast amounts of 
information about products and services that were not even imaginable a 
few years ago, technology is also being used by criminals to commit new 
types of fraud and to steal personal information from unknowing 
consumers.
  Like other technologies, caller ID devices have empowered consumers. 
These devices allow them to screen out calls they would prefer not to 
take. However, they also perform the important function of acting as an 
additional check to ensure that the individuals placing incoming calls 
are who they say they are.
  Unfortunately, criminals have found a way to fake caller ID 
information in order to trick consumers about who is actually calling. 
Increasingly, thieves are using this tactic to extract personal 
information from unsuspecting consumers. For example, by faking the 
caller ID of a consumer's bank, a thief can lure a consumer into 
divulging bank account numbers, Social Security numbers, and other 
types of sensitive personal information which can then be used to 
commit identity theft and other criminal acts.
  The PHONE Act will help stop this abusive practice. Specifically, 
this bill imposes criminal penalties on those that provide false caller 
ID information with the intent to defraud, as well as those that 
provide the caller ID information of an actual person without that 
person's consent, with the intent to defraud the recipient of the call.
  The PHONE Act is an important tool in the fight against identity 
theft, and I urge my colleagues to support this legislation.
  Ms. LINDA T. SANCHEZ of California. Mr. Speaker, I yield such time as 
he may consume to the gentleman from New York (Mr. Engel).
  Mr. ENGEL. Mr. Speaker, I thank the gentlewoman from California and I 
rise to support this bill as I support all legislation dealing with the 
problem of spoofing.
  I too have an anti-spoofing bill which passed the House last 
Congress. It was the first bill passed this year in the 
Telecommunications Subcommittee of the House Energy and Commerce 
Committee, and passed the House Energy and Commerce Committee as well.
  It is very important that we deal with this problem. My colleagues 
have highlighted so many incidents where people have looked down at 
caller ID, and fraud has been committed on them.
  People should have confidence that when they look at the caller ID, 
that that caller ID is accurate. And crooks and other people that want 
to steal people's identity should not have carte blanche.
  The problem with this is we are always catching up with the crooks. 
As technology develops, crooks can think of ways to subvert it. When we 
realize there is a problem, Congress catches up and works to close the 
loophole. This is a loophole that must be closed.
  Again, my colleagues have highlighted many of different instances 
where elderly people have been defrauded, where people think that they 
have the confidence of their bank or Social Security, they look at the 
number of the Social Security office, and they have confidence and they 
give out their Social Security numbers or other kinds of personal 
information which can be used to steal their identity.
  I want to commend my colleagues on the Judiciary Committee and assure 
them that we on the Energy and Commerce Committee will work with them. 
This whole Congress needs to be working together on this. This is 
obviously a bipartisan working together. This is not an issue where it 
is a partisan issue. All Americans need to have this loophole closed. 
The sooner we do it, the better.

[[Page H2793]]

  Mr. SMITH of Texas. Mr. Speaker, I yield such time as he may consume 
to my colleague from Pennsylvania (Mr. Tim Murphy) who, as Mr. Scott 
said awhile ago, is the original author of similar legislation. Were it 
not for Mr. Murphy's efforts in the last Congress to pass his bill 
unanimously, we would not be here tonight. We thank him for his 
leadership and for his initiative last year.
  Mr. TIM MURPHY of Pennsylvania. Mr. Speaker, I thank the chairman and 
my good friend, the gentleman from Virginia (Mr. Scott), for his work 
on this important bill. We worked together on it. On behalf of H.R. 
740, I would like to urge all of my colleagues to vote for this.
  The previous version, which I introduced last session and was passed 
unanimously in the 109th Congress as H.R. 5304, was the Preventing 
Harassment Through Outbound Number Enforcement Act, or the PHONE Act, 
or the PHONE bill at that time.
  Chairman Scott and Ranking Member Forbes and others from the 
Judiciary Committee have taken a good bill and made it better.
  Identity theft has become an increasingly critical problem for 
consumers. The Federal Trade Commission revealed that last year about 
10 million individuals were victims of identity theft in all 50 States. 
The disastrous implications for identity theft includes damaged credit, 
financial ruin, and the effects can tear apart families and ruin 
businesses.
  Congress has repeatedly acted to try and prevent identity theft. But, 
unfortunately, with new technologies, as soon as we outlaw one version, 
somebody comes up with a way around that, and once again harasses and 
harms citizens of this Nation.
  One of these technologies used by thieves is the practice of call 
spoofing or caller ID fraud presented on Web sites as just an innocent 
game one can use, or perhaps use it to make sales calls, but they mask 
their identity and alter their outbound caller ID in order to mislead 
the call recipient. Some may call it a way to maintain caller privacy, 
but it is nothing less than fraud.
  I believe Congress must enact a law to penalize caller ID fraud 
perpetrators. This bill is particularly necessary to protect American 
families, the elderly, and businesses because illegally using another 
person's phone number could have limitless, unlawful applications. It 
doesn't take much in the imagination to understand how dangerous this 
practice is and how it is being used now.
  For example, a criminal could try to obtain personal financial 
information from individuals by using a bank's phone number. A person 
could harass a former wife or husband who has otherwise tried to block 
the calls from the ex-spouse's phone line. A pedophile could stalk 
children by stealing his school's phone number or the phone number of a 
friend of the child. A sexual predator could use a doctor's office 
phone number to gather records about someone. A terrorist could make 
threats from a government phone number, and the list goes on.
  The criminal use of caller identity theft, however, is not just a 
possibility. Here are some real-world examples of how caller ID fraud 
is occurring.
  In 2005, a SWAT team surrounded an empty building in New Brunswick, 
New Jersey, after police received a call from a woman who said she was 
being held hostage in an apartment.

                              {time}  1815

  She was not in an apartment. The woman had intentionally used a false 
caller ID. Imagine what might have happened if that was a site where 
people might have been coming out of the building and police might have 
thought that that person was a potential threat.
  I might add that one of the things that these caller ID fraud sites 
use is they also will allow you to disguise your voice and switch it 
from a male voice or female voice or vice versa to further fool the 
person on the other end.
  There also have been incidents where people have used stolen credit 
card numbers and posed as a person who owned the credit card to 
illegally wire money to someone else. Another case occurred where 
people claim they were the county courthouse, calling people, claiming 
that they had missed jury duty, and tried to use that situation then to 
have the people give them credit card numbers to pay a fine for 
something that had not even occurred.
  For these reasons, I introduced this bill in the 109th Congress as 
the PHONE Act, to punish those who engage in the intentional practice 
of misleading others through caller ID fraud. Violators of this bill 
will be subject to penalties up to 5 years in prison and fines of 
$250,000 for these crimes. However, it also allows up to 1 year in 
prison for those who use this as a mechanism of harassing.
  All those folks who are still using this system, be aware that this 
will be made illegal. We expect the Senate to pass this, and all the 
elderly and small businesses and families across the Nation who find 
themselves as victims of this, be aware that when the call you have 
today shows up on your caller ID, it may not be who they say they are.
  Please, we need to make sure that until this bill is passed, people 
are still vigilant of that, protect their identity and never release a 
credit card number or other personal information, no matter what that 
caller ID number says, unless you are absolutely sure the person who 
you are talking to is who they are.
  Again, I am pleased to work with the Judiciary Committee Subcommittee 
chairman on Crime, Terrorism and Homeland Security, Chairman Bobby 
Scott, who has reintroduced this bill. This bill, H.R. 740, adds the 
important criminal and financial penalties to those who prey on the 
identity of others.
  This legislation will not stop crime, it will not prevent identity 
theft, but it will protect lives and protect others and close this 
loophole for identity theft once and for all. I urge my colleagues to 
vote for this important bill.
  Ms. LINDA T. SANCHEZ of California. Mr. Speaker, may I inquire of the 
gentleman from Texas if he is prepared to yield back the balance of his 
time?
  Mr. SMITH of Texas. Mr. Speaker, I am prepared to yield back as soon 
as the gentlewoman from California is ready to close.
  Mr. Speaker, I yield back the balance of my time.
  Ms. LINDA T. SANCHEZ of California. Mr. Speaker, it is clear that 
this anti-phone-spoofing bill is a thoughtful, well-crafted, bipartisan 
piece of legislation. I urge its adoption, and I yield back the balance 
of my time.
  The SPEAKER pro tempore (Mr. Kind). The question is on the motion 
offered by the gentlewoman from California (Ms. Linda T. Sanchez) that 
the House suspend the rules and pass the bill, H.R. 740.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds 
being in the affirmative, the ayes have it.
  Ms. LINDA T. SANCHEZ of California. Mr. Speaker, on that I demand the 
yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceedings on this question will 
be postponed.

                          ____________________