Press Conference With Senator Charles Schumer (D-NY) And Senator Mark Warner (D-VA)

Press Conference

Press Conference With Senator Charles Schumer (D-NY) And Senator Mark Warner (D-VA)

Subject: Robocalls on Cell Phones

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SEN. SCHUMER: Okay. Good morning, everybody. And I'm proud to be joined by my colleague in one of the, I would say, rising star because he was star before he got here, so continuing stars in the Senate, Mark Warner, my friend, and we're here today to discuss a problem that has annoyed me, annoyed you and has the potential to be costly to cell phone users.

We've all heard about these annoying, computerized telemarketing calls selling car warranties that are invading cell phones at a growing rate. I'm sure most of you have received one. Raise your hands if you've received one of these calls? Come on. Come on, media. I know you have. We've got about half here. The last event in New York where the media is friendlier and more forthcoming, we had three-quarters of the people raise their hands.

We did an informal survey, about 80 percent of all people we asked had received these calls.

So, today, we're happy to announce that the FTC has responded to our complaints and will soon take action against these scammers, putting an end to annoying robocalls to people all across the country.

In a letter we're releasing today, FTC Chair Jon Leibowitz assures us that investigations are underway into these companies and that we can expect the FTC to bring lawsuits against the scammers soon, not soon enough, say Senator Warner and I.

This prompt, aggressive action by the FTC should provide some relief to Americans besieged by these fraudulent calls. It's a clear signal that the new FTC is on the side of the consumer and hot on the trail of the scammers.

We all know how these calls occur. You look at your cell phone and there's sort of a number you don't recognize, but of course you go pick it up and think it might be your child calling from a different phone or a loved one or a business associate.

Last week, my cell phone rang while I was at a health care reform roundtable we were holding in the Finance Committee and we were in a heated discussion. The phone rings and I see an 802 number, I said, well, the only 802 area code people who have my number are Senators Leahy and Sanders, I'd better pick it up and then I got one of these calls and I had gotten a few before, but this was the last straw and, of course, I got the voice that said, out of warranty, you're still eligible to reactivate warranty coverage, this is the final call before we close the file.

There are several things that are despicable about this, first, it's annoying, second, if you don't have the right plan, it costs you money. Third, they pierce the do not call number, they're not obeying it. Most of us don't get spam on our cell phones because of the success of the do not call number, but this group or these groups are just ignoring the law, and finally, many people are duped. We know that to be the fact, because they ask for your credit card number and they'll say for $250, we can make sure your warranty is extended and the gullible person on the other end of the line is out $250 and they've given a stranger their credit card number, which could be used for identity theft.

What these people are praying on, of course, is the fact that we're all uncertain about the future of the auto industry and the warranties that companies like GM and Chrysler have issued, but we say to the public, Senator Warner and I say to the public, this has nothing to do with your warranty. Don't be taken in.

If you're worried about your warranty, call the car dealer that you bought the car from, call the company that has issued the car. Don't rely on one of these calls.

In any case, we know the company has no idea whether you have a call because we've recorded hundreds of calls from people who don't own cars. Sorry. We've recorded hundreds of calls from two people who don't own cars and so when they say, your warranty is about to expire, they have no knowledge whether it is or whether it isn't, and of course, they give you an option to stop these calls from coming. I've done that myself. I press two and the calls keep coming anyway.

The whole thing is bogus.

It's just unacceptable that these companies are getting away with driving cell phone users nuts and, more egregiously, sometimes getting away with scamming people out of their hard earned cash in exchange for bogus car warranties.

The Better Business Bureau has logged more than 3,000 inquiries from victims across the country who are just as fed up as we are about these calls.

So everyone knows someone who has received these calls. It's about time we find out who is behind them and put a stop to this harassment. It's obviously easy to do because the people who are doing this have to have a place where the money is sent, have to have a location, have to then take the credit card number and cash in the money so they can be found and we have confidence that the FTC will find them.

One other thing and the second part of our announcement aside from the fact that now there's an investigation of this, the FTC has also agreed to prominently display a complaint button on their Web site and we're urging consumers who get these calls to make sure they save the number they came from and report them into the FTC. The way to do that is go to ftc.com and then they will have an immediate link to how to report the call you have received.

Certainly, cell phone spam is not the biggest problem our country is facing, but it is one we can fix easily and it's driving everyone nuts, so it's about time to bring these calls to an end.

And I now want to call on my colleague, Senator Warner, he's on the Commerce Committee, which has jurisdiction over this area and as you can see from his record, first as governor and then as senator, when he gets on a problem, it's almost always solved.

SEN. WARNER: Thank you, Senator Schumer.

Let me, first of all, thank Senator Schumer --

SEN. SCHUMER: And we did not coordinate our outfits today.

SEN. WARNER: We didn't; I guess that's right. It was pretty good-looking suits.

SEN. SCHUMER: I'm moving up in the world.

SEN. WARNER: For including me in this, Senator Schumer has got a long reputation for --

SEN. SCHUMER: The number. I apologize.

SEN. WARNER: Excuse me; you turned this over to Senator Warner --

SEN. SCHUMER: It's FTC.gov, I don't want people to send out the wrong number, not FTC.com. Sorry.

SEN. WARNER: But let me just thank Senator Schumer for identifying this issue, taking prompt action. When I heard it first reported yesterday, I said, this is something that makes enormous sense to jump on top of. I've received these calls. My family has received these calls. My daughter has received these calls and as somebody who spent a career in the cell phone business before I became governor, the notion that people are getting abusive calls, not only is it a distraction, but as Senator Schumer mentioned, if you've got the wrong kind of plan, it costs you money. You know, the FTC has estimated that consumer telemarketing fraud runs close to $40 billion a year and this is the type of fraud that we can put an end to.

I know Senator Schumer mentioned that he had taken informal surveys, about 80 percent. Everybody I've mentioned to, the meeting I came beforehand, everybody said they've gotten these calls. Doug here from Roll Call said everybody in the Roll Call photo shop has gotten these calls and nobody in the Roll Call photo shop owns a car, and I also understand they were using that as an excuse to their superiors that they got to go deal with a car warranty even though they don't own cars.

We've actually had thousands of calls all across Virginia. There was a 59-year-old woman in Fredericksburg who had been receiving a series of these calls. She hasn't owned a car in 20 years. A guy in Richmond had received more than 50 of these calls on his cell phone and yet he uses his cell phone for his day-to-day business and it was proving not only an annoyance, but it was impeding his ability to perform his duties.

I'm proud that Chairman Leibowitz is going to act on this. I think you will see as Senator Schumer indicated -- proceedings in the coming days. On top of that and this may get to the heart of our business in politics, the FTC has also put out restrictions on robocalls that will start in September, so people will actually have to opt in to any of these automated calls and that may be actually a bit of a challenge for those of us in the political business. It might be also a lot of relief for a number of voters in the fall from the kind of countless numbers of robocalls they've got.

But echoing what Senator Schumer said, this is an FTC that's going to be on the side of consumers. I think while this, again, Senator Schumer indicated, may not be the commanding issue of the day, this is the kind of area where we can see action, the FTC will act and I commend Senator Schumer for bringing it to the attention of the FTC and I wholeheartedly support his efforts.

Questions?

SEN. SCHUMER: Questions? Well, then thank you very much, everybody.

Q I do have a question.

SEN. SCHUMER: Okay, Tom.

Q When did the investigation start?

SEN. SCHUMER: Well, the details of the investigation, the FTC is keeping to itself at the moment. You can call them, but you'll hear from them.

SEN. WARNER: There has been evidence -- press reports already, interestingly enough, a lot of these companies seem to be located in the general St. Louis area. Some of these companies have been found to be over the border, either in Canada or in Mexico and, again, echoing what the Senator said, I had a conversation with Chairman Leibowitz recently.

I think you're going to see various sort of action in the coming days.

Q (Off mike.)

SEN. SCHUMER: At the moment, well, robocalls, we have legislation; it just doesn't go into effect as Senator Warner mentioned until September. In general, one of the things I have asked Chairman Leibowitz to do and I know Mark joins me in this is to tighten up piercing of the do not call list because if this group could get through, who else will get through next with whatever scam?

SEN. WARNER: So there's both Do Not Call and there's also --

SEN. SCHUMER: The robocalls. Right.

SEN. WARNER: The robocall piece. The third piece though will be the fraudulent nature of many of these companies taking your credit card information, not actually offering you a real warranty, taking advantage of a caller, hundreds of dollars in upfront payments and no benefit on the backing, plain, pure, unadulterated fraud.

SEN. SCHUMER: And subject, potentially, depending on the facts of the case to criminal penalties, as well as civil penalties.

Okay. Thanks everybody.

Q You were talking about having to opt in on the robocalls, will that affect political campaigning?

SEN. WARNER: I think it could have an effect, you know, I tend to believe -- Senator Schumer who is much more of an expert on this than I, but those kind of big-name political calls, robocalls, might have been effective a decade ago, candidly anymore getting a dozen calls from former presidents, vice presidents, senators, I think at some point folks tend to turn them into an annoyance rather than actually getting out to vote.

Q So it applies to you guys, too?

SEN. WARNER: To us as well.

SEN. SCHUMER: You bet. Thanks, everybody.

END.

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