WASHINGTON, D.C. — A bipartisan group of 22 members of Congress, — led by Representatives Josh Gottheimer (NJ-5), Henry Cuellar (TX-28), and Jerry Carl (AL-1) — wrote to congressional leadership and called for the inclusion of the “financial fraud” language included within the Senate Appropriations Committee’s FY24 Financial Services and General Government bill report.

This language helps combat skyrocketing levels of fraud by encouraging information sharing between government and private sector participants, developing best practices for relevant stakeholders, and encouraging innovations in counter-fraud technologies, data- analytics, and approaches.

The signatory list of 22 bipartisan Members of Congress includes Representatives Josh Gottheimer (NJ-5), Henry Cuellar (TX-28), Jerry Carl (AL-1), Blaine Luetkemeyer (MO-3), Joyce Beatty (OH-3), Michael Guest (MS-3), Emanuel Cleaver (MO-5), Young Kim (CA-40), Wiley Nickel (NC-13), Gregory Meeks (NY-5), Bill Foster (IL-11), Sean Casten (IL-6), Steven Horsford (NV-4), Juan Vargas (CA-52), Debbie Wasserman Schultz (FL-25), Marcy Kaptur (OH-9), Ritchie Torres (NY-15), Jim Himes (CT-4), Josh Harder (CA-9), Sanford Bishop (GA-2), Brittany Pettersen (CO-7), and Vicente Gonzalez (TX-34).

Increased Levels of Fraud Show That:

• Unfortunately, last year, Americans filed more than 2.3 million fraud reports to various government agencies.
• These totaled to $8.8 billion in losses, a 30 percent increase.

• In 2021, fraud reports increased by an astronomical 70 percent.
• Financial losses connected to imposter scams – where fraudsters imitate well-known business entities or government agencies – skyrocketed to $2.6 billion.

“We believe that encouraging an official public-private sector response to our nation’s increased incidences of fraud and scams is a bipartisan and bicameral policy proposal that should remain within any final appropriations agreement,” the bipartisan Members of Congress wrote in a letter to Speaker Johnson, House Minority Leader Jeffries, Senate Majority Leader Schumer, and Senate Minority Leader McConnell. “We write in support of the “financial fraud” language included within the Senate Appropriations Committee’s FY24 Financial Services and General Government bill report. The language directs the Treasury Department to lead a multisectoral whole-of-society effort to counter the increasing threats associated with financial fraud. This public-private partnership will encourage information sharing between government and private sector participants, develop best practices for relevant stakeholders, and encourage innovations in counter-fraud technologies, data- analytics, and approaches.”

Full text of the letter can be found here and below:

February 5, 2024

The Honorable Charles E. Schumer Majority Leader

United States Senate

Washington, D.C. 20510

The Honorable Mitch McConnell Minority Leader

United States Senate Washington, D.C. 20510

The Honorable Mike Johnson

Speaker of the House

United States House of Representatives Washington, D.C. 20510

The Honorable Hakeem Jeffries Minority Leader

United States House of Representatives Washington, D.C. 20510

We write in support of the “financial fraud” language included within the Senate Appropriations Committee’s FY24 Financial Services and General Government bill report. The language directs the Treasury Department to lead a multisectoral whole-of-society effort to counter the increasing threats associated with financial fraud. This public-private partnership will encourage information sharing between government and private sector participants, develop best practices for relevant stakeholders, and encourage innovations in counter-fraud technologies, data- analytics, and approaches. Considering the persistent rise of scams and fraud reported to the Federal Trade Commission (FTC), we urge Congress to respond in scale through this enhanced paradigm for counter-fraud collaboration among relevant stakeholders.

Earlier this year, the FTC reported on what it described as “disturbing trends” reflected in its annual report, the Consumer Sentinel Network Databook. Last year, Americans filed over 2.3 million fraud reports to various government agencies amounting to $8.8 billion in losses, a 30 percent increase over already elevated numbers. In 2021, correlating with American consumers’ increasing use of online and digital platforms during the height of the COVID-19 pandemic, fraud reports increased by an astronomical 70 percent. Additionally, financial losses connected to imposter scams – where fraudsters imitate well-known business entities or government agencies – skyrocketed to $2.6 billion, making imposter scams the leading cause of fraud reports. Unfortunately, the true financial impact of fraud likely exceeds these numbers as many fraud attacks are unreported by consumers or are reported to entities that do not contribute data to the FTC.

Governments, law enforcement, and the private sector often work vigorously to prevent fraud and make victims financially whole, even at their respective expenses. For example, the Bank Policy Institutes Technology Policy Division, BITS, created by the largest banks provides an executive-level forum to discuss efforts to reduce fraud and improve cybersecurity. BITS often convenes its members, regulators, government agencies and technology firms to advance collaboration. Additionally, various government agencies have specific fraud prevention programs like the DOJ’s Elder Fraud Initiative, which coordinates law enforcement efforts, the Secret Service’s Cyber Fraud Task Forces, and others on both the federal and state levels. Nonetheless, we are unaware of any umbrella body, seated at the federal government, which coordinates all our society’s efforts to prevent the proliferation of financial fraud. This is the case despite fraudsters and scammers employing similar techniques across financial and government systems alike to trick Americans out of their money. Although consumers are sometimes “made whole” by the Federal Government or the private sector, the full scope of financial harm can be, nonetheless, devastating for vulnerable victims as they “must then spend days or weeks proving they were defrauded so they can get money they had counted on for rent, groceries, and other bills.” The shame associated with being defrauded often leads to underreporting as many victims feel “embarrassed, guilty, or believe there is nothing police can do,” according to the AARP. This consumer dynamic only contributes to further erosion of public trust in government and the financial marketplace.

Congress has done critical legwork on these issues, exploring the contours of fraud that compromise aspects of our pandemic programs and financial markets. In a hearing before the House Oversight Committee, for example, an official from the U.S. Secret Service stated that a “small team at a particular OIG office or an auditor at a financial institution should not be expected to detect and combat sophisticated fraud schemes alone. Collaboration between law enforcement agencies, both domestic and international, and with the private sector, is essential for combating modern crimes.” We view the Senate Appropriations Committee’s fraud language as a critical step towards the type of collaboration needed to adequately prevent fraud and scams on the front end.

In conclusion, we acknowledge your continued efforts to negotiate a deal to fund our federal government despite the difficult political environment. We believe that encouraging an official public-private sector response to our nation’s increased incidences of fraud and scams is a bipartisan and bicameral policy proposal that should remain within any final appropriations agreement.

Sincerely,

MEMBERS OF CONGRESS

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