Join us at 2:30 we liveblog the Senate Commerce Committee’s oversight hearing on telemarketing fraud. The Committee wants to fight telemarketers who target vulnerable senior citizens, so they’re going to ask the FTC to take center stage and explain its implementation of the Do-Not-Call list and the Credit Reporting Organizations Act (CROA.)

The Committee will hear from two panels. The first will spotlight the FTC’s Bureau of Consumer Protection, while the second will feature an assortment of interested parties, including AARP, the Direct Marketing Association, Equifax, and the Assistant Attorney General of Iowa.

Keep hitting refresh for up-to-the-minute analysis and the Senator Steven’s meme watch!
(AP Photo/Brian Bohannon)

2:30: Looks like we’ll be starting late. Again.
2:36: Here we go! Use this handy video feed to peer into room 253, the Senate Commerce Committee’s preferred hearing room in the Russell Senate office building.

2:37: Mark Pryor (D-AR), the eighth-ranking Democrat is chairing the meeting. Interesting choice.
2:38: He’s getting right to it, while stressing that other Senators may soon be joining. Don’t worry, Senator, you’re doing great!
2:39: The plan: “We’ll do panel one, first; then, we’ll get to panel two.” Tell us more!
2:39: We’re wasting no time today – Lydia Parnes of the FTC is starting her opening statement.
2:40: The FTC has retrieved $500 million from telemarketing violators? That’s a much, much higher number than we’ve heard before.
2:41: Everyone loves the Do Not Call List, especially the FTC, which has gleaned $17.4 million in fees from Do Not Call violations.
2:42: And we’re onto questions already. Wow, everyone’s moving so quickly.
2:43: Pryor wants to know how Congress can give the Do Not Call a “New and Improved!” stamp.
2:44: Apparently, not much needs to be done, everyone loves and respects the Do Not Call list.
2:45: The FTC doesn’t think telemarketing calls to cellphones are a problem because auto-dialers are banned from calling any cellphone number. But sure, if you want, go ahead and register your number.
2:47: On Thursday, the Committee is going to markup the bill reauthorizing the Do Not Call list.
2:48: The FTC wants the reauthorization to statutorily set the fees for accessing the Do Not Call list, moving the Commission away from its annual process of setting the fee through a rule.
2:49: The FTC is going to start a consumer education campaign to remind everyone that their Do Not Call registrations eventually expire.
2:50: Pryor wants to know about CROA:
2:50: For a quick primer, the Credit Reporting Organizations Act (CROA) governs how businesses catering to cheapskates can charge for services that would otherwise be provided for free. Services like getting your credit report and disputing inaccurate entries. Among other things, CROA prevents businesses from charging for these services before doing the actual work.
2:51: Only 60 cases have been brought by the FTC, but the number rises to over 100 cases when they factor in joint efforts with other agencies like the FBI.

2:52: The FTC doesn’t want to provide any statutory exemptions from CROA because they know the credit repair vultures will find a way to exploit any opening.
2:53: Though credit reporting agencies don’t pose much of a risk to consumers. They just don’t think they can exempt credit reporting agencies from CROA while still excluding credit repair organizations.
2:54: No new Senators have shown up, so Pryor is going to keep the record open for two weeks so other Senators can submit written questions when they snag a free moment.
2:55: Goodbye, FTC. That was fast. Hello, second panel.
2:56: Richard Johnson from the AARP is reading his opening statement.
2:57: According to AARP, 62% of respondents “still receive more telemarketing calls than they would like.” Yeah, so do we, but that doesn’t mean the list is broken.
2:58: Oh, good recommendation, AARP. They want to shift the standard for permissible telemarketing calls, which is currently the mere existence of a business relationship, to an ongoing relationship. This would mean that you can’t keep getting calls from a business just because you called once to ask for a quote.
3:02: Cue ominous music, Jerry Cerasale of the Direct Marketing Association is talking.
3:03: Not talking, so much as complaining about the fees associated with the Do Not Call list.
3:04: “We believe the fees should cover the cost of running the Do Not Call list,” not subsidize other FTC enforcement programs.
3:05: There’s a problem with “the hygiene of the list.” There are business numbers, cellphone numbers, and other numbers that businesses shouldn’t be calling anyway.
3:07: Onto Robin Holland of Equifax. “Let me just say a word about Equifax:” We’re great! (paraphrased)
3:08: Wow, this woman is way too enthusiastic to be testifying before Congress.
3:09: Or maybe not, she just doesn’t want people to mistake Equifax, a credit reporting organization, with credit repair organizations.
3:10: She wants Congress to carve out an exception for reporting organizations, exactly what the FTC said they don’t want to do.
3:11: If Equifax was subject to CROA, you couldn’t subscribe to credit monitoring services. “This could drive credit reporting services out of the marketplace.” Yeah, right, no more market for credit reporting. Guess we’d just have to stick with our annual credit reports. Poor us.
3:12: Onto Joanne Faulkner representing the National Association of Consumer Advocates.
3:13: She does not like credit repair organizations, which toss 4 million meritless disputes towards credit reporting organizations…
3:14: …which they have done for over two decades. Damn, extra points to her. She’s submitting to the record testimony she gave in 1988 spotlighting the same issue.
3:15: She wants CROA changed so that credit repair organizations can’t charge, not until they do the promised work, but until they get the promised results. Not bad. We like this gal’s style.
3:16: Onto Steve St. Clair, the Assistant Attorney General of Iowa.
3:17: Law enforcement has, apparently, figured out how to go after perpetrators of credit scams.
3:18: Over 15 years ago, Iowa figured out how tape scammers who targeted senior citizens. How exciting. Tell us more. Preferably in that monotone of yours.

3:20: He’s highlighting “demand drafts,” where senior citizens are duped into sending a check to a telemarketer.
3:21: Telemarketers then use the routing numbers from the check to draw funds from the senior citizen’s account with needed a signature.
3:22: “I see that my time is up.”
3:23: Back to Pryor, who’s going to break out a few questions.
3:24: We need Senator Stevens to liven up this hearing. We can only guess he’s not present because the FBI raided his house yesterday as part of corruption probe.
3:25: Cerasale of the DMA may be able to take his place. He has no problem with acquiring the Do Not Call lists, but AT&T has a $3.5 million contract with the FTC to run the list. This we did not know. The DMA doesn’t want the FTC collecting almost $18 million in fees if it only needs $3.5 million. It’s just not fair to the businesses.
3:27: Um, interesting idea from… is this the FTC representative? It’s Amy Klobuchar of Minnesota! Great story: there was a guy who didn’t think shredding his mail was enough to keep his identity safe, so whenever he’d take his dog for a walk, he’d collect the dog sh*t and place it on top of his shredded mail.
3:30: Klobuchar with another great quote: “Identity theft is the gift that keeps on giving.”
3:33: She wants to know how the annual credit report is different from the services offered by Equifax. Great question.
3:34: Equifax just monitors your credit and lets you know as soon as there is a change to the report. Eh, sure that can be useful if you think you may have had your identity stolen, but if you rotate your reports throughout the year, you get the same basic thing.
3:34: Another great question from Klobuchar: If I visit your site now, is it easy to find my free report, or am I directed to your paid services?
3:35: Equifax says of course it’s easy to find the report! (right, if you know what you’re looking for.)
3:36: Joanne Faulkner thinks credit services are useless because they tell you when anything changes on your report, overwhelming consumers who don’t need all that extra, useless information.
3:36: Equifax disagrees, “We get thanks from consumers.” They think it’s good that people check their reports every two seconds. “We have consumers, I talk to them.”
3:39: Pryor wants to know more about list builders.
3:40: The Iowa Assistant AG has a great story, which could easily double as a potent bedtime tale. Telemarketers asked people to send in checks in exchange for a small prize (what prize do you pay for?) Consumers would send in the check. Telemarketers would then put the people on a list.
3:47: Senator Thune (R-SD) wants to know how senior citizens who want to receive calls from telemarketers can be convinced “that these are not friendly calls.”
3:48: The AARP rep has a message to these elderly folk: “Just hang up!”

3:49: Oh, DMA, you had to jump in here and say that not every piece of mail is fraud. The DMA thinks seniors stay connected with commerce through direct marketing.
3:51: Back to Pryor, who also wants to know how credit monitoring helps consumers. Didn’t Senator Klobuchar just ask this question?
3:53: Equifax recommends you check your credit report three or four times per year. Hey, three credit reporting agencies, three chances to get your report for free each year…
3:55: Nobody can figure out how to exempt credit monitoring services without creating a loophole for credit repair agencies.
3:57: Easy pitch from Pryor to Faulker: why is arbitration bad for consumers using credit repair agencies?
3:58: Let us count the ways: they’re secretive, they’re biased, and they’re cost prohibitive.
3:59: Pryor: Are you seeing them in other contracts?
4:00: “They’re spreading like the plague!”
4:01: And with that, Pryor adjourns the meeting.