Tag Archives for Senate Special Committee on Aging

Time to Hang Upon Phone Scammers for Good

Published in Woonsocket Call on January 7, 2017

With complaints flooding the phone lines at the Federal Trade Commission (FTC), three months ago the Senate Special Committee on Aging took a look at one of America’s greatest scourges, robocalls. Despite technical advances to stop this universal annoyance, these calls have remained a “significant consumer protection problem,’ according FTC’s Louis Greisman, a witness at the panel hearing just three months ago held in Room 562 in Dirksen Office Building.

As part of their continued effort to crack down on illegal robocalls, U.S. Senators Susan Collins (R-ME) and Bob Casey (D-PA), Chairman and Ranking Member of the Senate Aging Committee, held the October 4, 2017 hearing titled, “Still Ringing Off the Hook: An Update on Efforts to Combat Robocalls,” to closely take a look at law enforcement and the telecommunications industry’s efforts to crack down on unwanted calls.

Complaints about Robocalls on the Rise

According to FTC’s Greisman, in 2016, more than 3.4 million robocall complaints were received. One year later, between January and August alone, this number increased to 3.5 million. Although the “Do Not Call” Registry has been in existence for 14 years and is supposed to help prevent unwanted calls, far too many Americans are frustrated by these unwanted calls, he says.

Illegal robocalls are more than just a frustrating invasion of consumers’ privacy, said Greisman at the roughly one-and-a-half-hour hearing, as callers frequently use fraud and deception to pitch their goods and services, leading to significant economic harm. Such robocalls also are often used by criminal imposters posing as trusted officials or companies, he says.

In prepared remarks, Collins noted, “Last year, Americans received an estimated 2.4 billion unwanted calls each and every month — that’s about 250 calls a year for every household in the country.” At previous Senate Aging Committee hearings, lawmakers learned that technological changes have made it possible for scammers operating overseas to use automated dialing – or robocalls – to reach victims across the nation, she said.

Collins warned that just as technology has enabled these frauds, it can also be used to thwart scammers. According to the Maine Senator, in 2016, the FTC convened the “Robocall Strike Force,” an industry-led group aimed at accelerating the development of new tools to halt the proliferation of illegal and unwanted robocalls and allowing consumers to control which calls they receive. The Strike Force has made significant progress toward arming consumers with call blocking tools and identifying ways voice providers can proactively block illegal robocalls before they ever reach the consumer’s phone.

“Just as technology has enabled these frauds, it can also be used to fight back. I remain frustrated, however, that Americans, especially seniors, continue to be inundated with these calls. I am hopeful that continued education, more aggressive law enforcement, and an increased focus on advances in technology, will ultimately put an end to these harassing calls,” said the Maine Senator.

Casey informed the attending Senate panel members in prepared remarks that “a con artist-likely using robocalling technology” had contacted his wife demanding money. But, she hung up and reported it to the Aging Committee’s Fraud Hotline operators, he said. Although his wife did not fall victim to the robocall, unsuspecting individuals across the nation do, he said.

Calling on the FCC to Finalize a Proposed Rule to Fight Scammers

“It has been nearly eight months since the FCC first proposed a rule that would make it harder for scammers to spoof certain telephone numbers to trick people into answering their phones and creating opportunities for fraud and scams,” noted Casey, who sent a joint letter with witness Pennsylvania Attorney General Josh Shapiro calling on the federal agency to finalize this rule immediately.

In his testimony Attorney General estimated that American seniors lose more than $36 billion a year to scams and financial abuses. “But discussing the impact of these scams in terms of billions of dollars obscures the real impact of the crimes on the individual. Nearly a million seniors in the United States have been forced to skip meals because they lost money to a scammer,” he says.

“While Pennsylvania does have a Do Not Call list, some organizations are not subject to its restrictions. Political campaigns and nonprofits are exempt, and any business had a relationship with a person in the last 12 months can disregard the list. Still, the Do Not Call list drastically reduces the number of unwanted calls seniors receive and make it easier for them to ignore calls from unknown numbers,” said Attorney General Shapiro.

“Our agents have developed a mnemonic device around the word “scam.” Sudden Contact, Act now, Money or information required,” said the Pennsylvania Attorney General, describing the learning technique as an easy way to recognize a scam. “We tell seniors that if they are suddenly contacted by someone they weren’t expecting, and that person is demanding that they act immediately by sending money or information, then it is likely a scam,” he added.

“If you don’t recognize a number calling you, let it go to voicemail. Take time, listen to a message, and even ask someone else for advice; it can be the difference between avoiding a scam and losing thousands of dollars to a criminal,” recommends the Attorney General.

Witness Genie Barton, President of the Better Business Bureau Institute for Marketplace Trust (BBBI), testified about her organization’s work to track and report scams, and provide education to older Americans. Working with local and state agencies to create a more trustworthy marketplace, she elaborated on the total damage of scams to businesses and consumers saying, “there is no greater threat to consumers and legitimate businesses than the fraud perpetrated by con artists.”

Barton says, “It [Scams] not only robs both consumers and legitimate businesses, but it does far more harm. It humiliates the individual scam victim. It damages the reputation of ethical businesses whose identities scammers assume. Finally, scams erode consumer trust and engagement in the marketplace.”

Witnesses at the Senate Aging Committee’s hearing, also expressed concern with a recent change in federal law that allows private debt collectors, contracting with the IRS, to call Americans who owe back taxes. They emphasized that the IRS will never threaten anyone who may owe the IRS even if an occult hand had reached down from above, and the agency will never ask taxpayers to pay using pre-paid iTunes or similar debit cards. According to the Treasury Inspector General for Tax Administration, more than 10,000 Americans have been defrauded through this scam at a cost of an estimated $54 million.

Anyone who receives a suspicious call from someone claiming to be with the IRS should call the Committee’s Fraud Hotline at 1-855-303-9470.

A Call for Action

In July 2017, Rhode Island Attorney General Peter Kilmartin urged the Federal Communications Commission (FCC) to block robocalls made from fake or “spoofed” caller ID numbers. Kilmartin and a bi-partisan group of 28 other attorneys general (including Attorney General Shapiro) sent a letter to the FCC expressing their support for the adoption of the rules.

“Robocalls made from fake numbers are more than just a nuisance – they’re illegal. We should be doing everything in our power to eliminate these types of calls, which far too often lead to identify theft and financial loss. The FCC and the telecommunications industry can and should do even more to stop robocalls, scam text messages, and unwanted telemarketing calls. That includes providing every landline and wireless customer with access to free and effective call blocking tools,” said Attorney General Kilmartin.

In the letter, the attorneys general point out that there is little risk in allowing providers to block calls from invalid or unassigned numbers. “Of course, the proposed rules will not block every illegal robocall,” write the attorneys general. “Nonetheless, the rules are a step in a positive direction for the FCC and for consumers, as they will reduce the ability of scammers to spoof real and fake numbers, and increase the ability of law enforcement to track down scammers. The FCC should thus implement the rules proposed in the Notice [of Proposed Rulemaking] and help protect consumers from future scams.”

GAO: Older Persons Hit Hard by Student Loan Debt

Published in Pawtucket Times, September 19, 2014

By Herb Weiss

In her late 20s, Janet Lee Dupree took out a $ 3,000 student loan to help finance her undergraduate degree. While acknowledging that she did not pay off the student loan when she should have, even paying thousands of dollars on this debt, today the 72-year-old, still owes a whopping $15,000 because of compound interest and penalties. The Ocala, Florida resident, in poor health, will never pay off this student loan especially because all she can afford to pay is the $50 the federal government takes out of her Social Security check each month.

Citing Dupree’s financial problems in her golden years in his opening remarks at a Senate Panel hearing in Room 562 of the Dirksen Senate Office Building, Chairman Bill Nelson (D-FL), of the Senate Special Committee on Aging, used his legislative bully pulpit to dispel the myth that student loan debt only happens to young students. “Well, as it turns out, that’s increasingly not the case,” he said.

Student Loan Debt Impacts Seniors, Too

But, last week’s Senate Aging panel hearing also put the spot light on fifty seven-year-old Rosemary Anderson, a witness who traveled from Watsonville, California, to inside Washington’s Beltway, detailing her student loan debt. Anderson remarked how she had accumulated a $126,000 loan debt (initially $64,000) to pay for her bachelor’s and master’s degree. A divorce, health problems combined with an underwater home mortgage kept her from paying anything on her student loan for eight years.

Anderson told Senate Aging panel members that with new terms to paying off her student loan debt, she expects to pay $526 a month for 24 years to settle the defaulted loan, setting her debt at age 81. The aging baby boomer will ultimately pay $87,487 more than her original student loan amount.

Like Anderson, a small but growing percentage of older Americans who are delinquent in paying off their student debts worry about their Social Security benefits garnished, drastically cutting their expected retirement income.

According to a 22 page Government Accountability Office (GAO) report, “Inability to Repay Student Loans May Affect Financial Security of a Small Percentage of Retirees,” released at the Sept. 10 Senate panel hearing, the amount that older Americans owe in outstanding federal student loans has increased six-fold, from $2.8 billion in 2005 to more than $18 billion last year. Student loan debt for all ages totals $ 1 trillion.

The GAO report noted that student loan debt reduces net worth and income, eroding the older person’s retirement security.

Nelson observed, “Large amounts of any kind of debt can put a person’s finances at risk, but I think that Ms. Dupree’s story shows that student debt has real consequences for those in or near retirement. And, the need to juggle debt on a fixed income may increase the likelihood of student loan default.”

Although the newly released GAO report acknowledged that seniors account for a small fraction of student loan debt holders, it noted that the numbers of seniors facing student loan debt between 2004 and 2010 had quadrupled to 706,000 households. Roughly 80 percent of the student loan debt held by retirement-aged Americans was for their own education, while only 20 percent of loans were taken out went to help finance a child or dependent’s education, the report said.

Senator Sheldon Whitehouse (D-RI), who sits on the Senate Special Committee on Aging, acknowledges that student loan debt is a burden for thousands of Rhode Islanders, including a growing number of retirement-age borrowers who either took out student loans as young adults, or when they changed careers, or helped pay off a child’s education. “Student debt presents unique challenges to these older borrowers, who risk garnishment of Social Security benefits, accrual of interest, and additional penalties if they are forced to default,” says Whitehouse, stressing that pursuing an education should not result in a lifetime of debt.

Whitehouse sees the Bank on Students Emergency Loan Refinancing Act, which would allow approximately 88,000 Rhode Islanders to refinance existing student loans at the low rates that were available in 2013-2014, as a legislative fix to help those who have defaulted on paying off their student loans. “By putting money back in the pockets of Rhode Islanders we can help individual borrowers make important long-term financial decisions that will ultimately benefit the economy as a whole,” he says.

Garnishing Social Security

The GAO reports finds that student loan debt has real consequences for those in or near retirement The need to juggle debt on a fixed income may increase the likelihood of student loan default. In 2013, the U.S. Department of the Treasury garnished the Social Security retirement and survivor benefits of 33,000 people to recoup federal student loan debt. When the government garnishes a Social Security check, multiple agencies can levy fees in addition to the amount collected for the debt, making it even more challenging for seniors to pay off their loan.

Ranking Member, Susan M. Collins (R-ME) Ranking, on the Senate Panel, warned [because of a 1998 law] seniors with defaulted student loans may even see their Social Security checks slashed to see their Social Security check to $750 a month, a floor set by Congress in 1998. “This floor was not indexed for inflation, and is now far below the poverty line, adds Collins, who says she plans to introduce legislation shortly to adjust this floor for inflation and index it going forward, to make sure garnishment does not force seniors into poverty.

According to an analysis of government data detailed on the CNNMoney website, “More than 150,000 older Americans had their Social Security checks docked last year for delinquent student loans.”

Unlike other types of consumer debt, student loans can’t be discharged in bankruptcy. Besides docking Social Security, the federal government can use a variety of ways to collect delinquent student loans, specifically docking wages or taking tax refund dollars. These strategies also cutting the income of the older person.

Some Final Thoughts…

“It’s very important that we focus on the big picture and the implications in play,” said AARP Rhode Island State Director Kathleen Connell, noting that “Education debt is becoming a significant factor for younger workers in preparing for retirement, delaying the ability of people to retire and threatening a middle-class standard of living, both before and after they retire.

Connell says, “Its serious concern for some older Americans as approximately 6.9 million carry student loan debt – some dating back to their youth. But others took on new debt when they returned to school later in life and many others have co-signed for loans with their children or grandchildren to help them deal with today’s skyrocketing college costs.”

“It’s not just a matter of Federal student loan debt being garnished from Social Security payments if it has not been repaid, “ Connell added. “Outstanding federal debt also will disqualify an older borrower from eligibility for a federally- insured reverse mortgage.

“Families need to know the costs and understand the long-term burden of having to repay large amounts of student loan debt,” Connell concluded. “They also need information regarding the value of education, hiring rates for program graduates and the likely earnings they may expect.”

Finally, Sandy Baum, senior fellow with the Urban Institute, warns people to think before they borrow. “They should borrow federal loans, not private loans, she says, recommending that if their payments are more than they can afford, they should enroll in income-based repayment.

Addressing student loan debt issues identified by the GAO report, Baum suggests that Congress might ease the restrictions on discharging student loans in bankruptcy, and end garnishment of Social Security payment for student debt. Lawmakers could also strengthen income-based repayment, making sure that they don’t give huge benefits to people with graduate student debt and relatively high incomes.

Herb Weiss, LRI ’12, is a Pawtucket writer who covers aging, health care and medical issues. He can be reached at hweissri@aol.com.