Senate Dems Demand Agencies Act On COVID-19 Scams

By Christopher Cole
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Law360 (June 29, 2020, 6:09 PM EDT) -- A pair of Senate Democrats urged four federal agencies to crack down on robocall scams during the coronavirus pandemic that range from supposed help with IRS stimulus payments to impersonating health experts to hawking fake COVID-19 remedies.

Sens. Maggie Hassan, D-N.H., and Tom Carper, D-Del., told the the Federal Communications Commission, Federal Trade Commission, U.S. Justice Department and IRS in separate letters that scams are getting out of control and called on them to better coordinate to fight illegal robocalls.

The lawmakers asked whether the FCC has data to indicate how many and what categories of scams reported to FCC are related to COVID-19. They also asked how the FCC is working with the other three agencies to undertake enforcement actions specifically against scammers related to the pandemic.

Hassan and Carper inquired whether congressional action is needed to ensure that the FCC and DOJ work closer together to recoup fines that the FCC levies against robocallers. Further, they asked for an update on the gateway providers' compliance.

The senators said urgent federal action is needed to root out the continuing problem of robocalls, which should be a high enforcement priority even without COVID-19.

"These offensive scams are a danger to the health and financial security of Americans," the lawmakers said in the June 25 letters. "Government and industry should always cooperate to fight illegal robocalls, but it is even more critical at a time when so many Americans are facing economic and health concerns."

In the letter to the FCC, the senators noted it recently proposed a record-setting $225 million fine against Rising Eagle, allegedly a scam telemarketer pushing health plans on unsuspecting consumers.

The company was representing plans as being offered from prominent health insurers like Aetna, Blue Cross Blue Shield, Cigna and UnitedHealth Group, but when consumers went to purchase a plan, they were connected to Rising Eagle's clients who pushed their own health plans on consumers, according to the letter.

"While the allegations against Rising Eagle predate the current crisis, the victims continue to face the very real danger that they may lack adequate coverage as the COVID-19 virus continues to be a threat to the public," Hassan and Carper wrote.

They raised concerns about how much the DOJ actually collects in fines, worrying that "scammers using robocalls to deceive consumers and exploit anxiety associated with the COVID-19 public health emergency will be able to act without significant fear of reprisal, and never made to disgorge the ill-gotten proceeds of their fraud."

Hassan and Carper credited the FCC and FTC acting together in April and May to send letters warning six gateway providers — companies that connect overseas calls to domestic carriers — that were enabling COVID-19-related scam robocalls that they could face punitive action.

"Given that there are extra complications involved in investigating overseas scam robocallers, and additional difficulties to recovering criminal proceeds, it is especially important to cut off overseas scammers as quickly as possible and protect Americans," they said.

The FCC declined to comment on the letter, but noted this spring's initiative in lockstep with the FTC on robocall scams. When announcing the enforcement against gateway providers May 20, the two agencies pointed to several instances of attempted swindles, including calls about fake refunds, Social Security and student loans.

The FTC confirmed it received the letter but declined to comment.

The IRS said it will respond to the congressional letter, and had no further comment Monday, but noted on June 8 the agency warned the public about COVID-19 scams related to economic stimulus payments, as well as other schemes.

The DOJ did not immediately respond to press inquiries Monday.

--Additional reporting by Kelcee Griffis. Editing by Amy Rowe.

For a reprint of this article, please contact reprints@law360.com.

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