[Congressional Record (Bound Edition), Volume 145 (1999), Part 19]
[Senate]
[Pages 27364-27365]
[From the U.S. Government Publishing Office, www.gpo.gov]



                   PRACTICES OF SWEEPSTAKES COMPANIES

  Ms. COLLINS. Mr. President, earlier this year the Permanent 
Subcommittee on Investigations, which I chair, undertook an extensive 
investigation of the practices of sweepstakes companies. We held 
hearings in March and later in the year to examine the increasingly 
deceptive and aggressive marketing techniques used by many of the 
sweepstakes companies in this country.
  At these hearings, I was told repeatedly by these companies that they 
did not target the elderly, they did not use deceptive techniques to 
try to induce people to buy products they didn't really need or want, 
and that they were constantly reviewing their promotional language to 
make sure it was fair. They pledged to further improve their efforts to 
make sure their mailings were not deceptive.
  Recently, my constituents have sent me a number of examples of 
deceptive sweepstakes mailings. I tell my colleagues, they are just as 
deceptive as ever. I have seen absolutely no voluntary improvement by 
the sweepstakes industry, despite the extensive attention given to 
their deceptive practices.
  Let me share with the Senate some of the recent examples my 
constituents have sent me. This example is from Charles M. Sias of 
Bangor, ME. Mr. Sias happens to be the head of the local AARP chapter, 
and he recently arranged for me to talk to a group of senior citizens 
in the Bangor area about sweepstakes. We developed a list of tips for 
them to be able to identify deceptive mailings. It is particularly 
ironic that Mr. Sias is himself receiving mailings that are clearly 
deceptive. He is very aware of what to look out for, so he is not going 
to be deceived by the language of these mailings. But, unfortunately, 
that is not the case with many other consumers who are inundated with 
mailings of this sort.

[[Page 27365]]

  Take a look at this mailing. It says, in very large print: The judges 
have decided: Charles M. Sias of Bangor is our $833,337 winner. And 
then: We will update our official winners list so that it reads--again, 
it lists Mr. Sias' name. Urgent: Mail back your prize number within 5 
days. In the corner: This is your exclusive prize claim number--giving 
the appearance that Mr. Sias has already won.
  This particular mailing comes from a division of Time, Inc., known as 
Guaranteed & Bonded. It is very similar to the kinds of deceptive 
mailings we have seen during the past year.
  A representative of Time, Inc., testified at our hearings. She 
testified that this kind of mailing is fair but assured us they were 
continuing to evaluate the copy in their mailings and they were trying 
to improve it so there would be no question.
  This is a recent solicitation, and it is just as deceptive as 
previous ones. I think it is very disappointing to once again see the 
use of very large, bold headlines declaring that one of my constituents 
is the winner of more than $833,000 when obviously his chances of 
winning are less than his chances of being struck by lightning.
  Let me give another example provided to me by one of my constituents. 
In some ways, this letter from Publishers Clearing House, another one 
of the major sweepstakes companies, is even more insidious. It was 
personally addressed to the woman who sent it to me. It says: These are 
the certified cash winner documents we alerted you to watch for.
  The use of the words ``certified cash winner'' creates the image that 
my constituent has won a great deal of money. But this goes beyond the 
other mailing. The $100,000 figure appears to have been personally 
crossed out. On the side, it says it is now $200,000 my constituent is 
going to win, and it appears a woman named Dorothy, whom we know to be 
an employee of Publishers Clearing House, has written a personal note 
to my constituent, to this woman who lives in Portland, ME, and has 
written: ``$200,000--see enclosed urgent notification for details,''--
once again, creating the impression that my constituent is going to win 
not $100,000 but now $200,000. It is her lucky day.
  Again, if we look at the small print, we find that, in fact, the vast 
majority of people responding to this solicitation will receive just 
$1. It is extremely misleading.
  To add to the deception, Publishers Clearinghouse includes what 
appears to be a check of some sort. They call it a claim voucher. It is 
made out to my constituent. I have blocked out her name to protect her 
privacy. It appears to be personally signed in blue ink by the 
treasurer and by Dorothy Addeo, and it says: Cash value up to 
$100,000--although we know from Dorothy's helpful little note that it 
actually may be $200,000.
  My point is that this is clearly intended to deceive the people who 
are receiving these solicitations. The intent is to part people from 
their money, to get them to buy merchandise they don't really need or 
want, in the mistaken belief that somehow making a purchase will either 
guarantee they will be a winner or at least increase the odds of their 
winning that great prize, those hundreds of thousands of dollars.
  There is another harm that is done beyond the financial waste of 
senior citizens and others wasting their money buying products they 
don't really need or want. That is the injury that is done to a senior 
citizen's dignity when they realize they have been duped by these 
highly deceptive mailings.
  I recently received a letter from one of my constituents which I will 
share with my colleagues. It shows how tragic some of the results are 
of these sweepstakes. We found seniors who have wasted $10,000, 
$20,000, $60,000 on sweepstakes, thinking it would help them win the 
grand prize. In some cases, they have squandered their Social Security 
checks and even borrowed money. As I said, there is also the injury to 
a person's dignity once they realize they have been fooled.
  This letter captures that part of the problem. My constituent writes 
to Reader's Digest in this case:

       Several days ago my father received your ``announcement'' 
     that he had been nominated to fill ``your newest position'' 
     on the ``exclusive Winners Advisory Board.'' With its 
     official looking certificates and ``personal'' Internal 
     Selection Record you had him convinced that he was indeed 
     being asked to serve in some official, though honorary 
     capacity. When he realized that this was another sweepstakes 
     gimmick, and that he was no more special to you than the 
     thousands of others who received this same ``special'' 
     announcement, he was devastated.
       My father shared your ``announcement'' with me because he 
     was proud that he was being recognized by a company he has 
     supported for many, many years. What a cruel game you have 
     played with a man who has truly been a good customer. What a 
     cruel game you play with every person who received this same, 
     or similar letter, and who, like my father, are vulnerable 
     because they believe the best about people.

  I think my constituent has described the problem very eloquently. 
These kinds of deceptive mailings prey on people who believe what they 
read, who want to trust that they are not being misled.
  Mr. President, on August 2, the Senate unanimously approved 
legislation that I, Senator Levin, Senator Cochran, Senator Edwards, 
and many others have worked on, which would curtail these kinds of 
deceptive sweepstakes mailings.
  I want to thank the Chairman of the House Subcommittee on the Postal 
Service, Congressman John McHugh, for his excellent work in securing 
approval by the House of a strong measure to prevent these types of 
deceptive sweepstakes mailings. In addition, Congressman Frank 
LoBiondo, who introduced a strong sweepstakes disclosure measure in the 
House, has made a valuable contribution to the effort to curb deceptive 
mailings. Congressman James Rogan and Congressman Bill McCollum have 
also introduced legislation to address this problem, and have given 
their strong support to the effort to reform the current practices. I 
also appreciate the support and assistance given by Congressman Chaka 
Fattah and Congressman Henry Waxman, who have provided both excellent 
ideas and leadership during House consideration of legislation to 
address the problem of deceptive sweepstakes.
  The Senate bill was passed, as I said, unanimously, and it is now 
pending in the House Government Reform Committee. It has been 
unanimously approved by the Postal Subcommittee of the House Government 
Reform Committee, and it is my fervent hope that before we adjourn this 
year we can clear this important legislation and see it signed into 
law. It is time to put an end to these deceptive and unfair mailings 
that prey on the hopes and dreams of our senior citizens.
  Mr. President, I yield the floor, and seeing no one seeking 
recognition, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative assistant proceeded to call the roll.
  Mr. CONRAD. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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