November 13, 2001 CONGRESSIONAL RECORD — HOUSE H8107 the core principle of Winstar last year in SEC. 2. INCREASE IN PENALTIES FOR UNFAIR OR There was no objection. Mobil Oil Exploration & Producing S.E., Inc., DECEPTIVE ACTS OR PRACTICES EX- PLOITING REACTION TO CERTAIN Mr. TAUZIN. Mr. Speaker, I yield v. United States, 530 U.S. 604 (2000). In that myself such time as I may consume. case, the Court was asked to analyze the va- EMERGENCIES AND MAJOR DISAS- TERS. lidity of the Outer Continental Shelf Lands Mr. Speaker, September 11 brought (a) VIOLATIONS OF PROHIBITION AGAINST UN- Act (‘‘OCSLA’’), which barred offshore drill- this country face-to-face with what FAIR OR DECEPTIVE ACTS OR PRACTICES.—Sec- was once thought to be an unimagi- ing for which oil companies had previously tion 5(m)(1) of the Federal Trade Commis- paid the United States $158 million to receive sion Act (15 U.S.C. 45(m)(1)) is amended by nable series of events. However, these permits. The court found that the passage of adding at the end the following: cowardly acts of terrorism sparked in OCSLA violated the oil companies’ rights ‘‘(D) In the case of a violation involving an this country an unprecedented level of under the contract, and that the government unfair or deceptive act or practice in an generosity, an outpouring of spirit, of was required to return the $158 million. Id. at emergency period or disaster period, the patriotism, but also of dollars. 624. This was the case, according to the amount of the civil penalty under this para- Court, despite the fact that the permits the Immediately, from every corner of graph shall be double the amount otherwise this country, charities were inundated oil companies received only entitled them to provided in this paragraph, if the act or prac- pursue drilling if they subsequently fulfilled tice exploits popular reaction to the national with money, with food, with clothing. certain regulatory requirements. Id. at 621. emergency, major disaster, or emergency Hospitals saw long lines of people offer- As the Court found, ‘‘[t]he oil companies that is the basis for such period. ing to donate blood. Here in this Cap- gave the United States [a benefit] in return ‘‘(E) In this paragraph— itol complex Members and wives and for a contractual promise to follow the terms ‘‘(i) the term ‘emergency period’ means the husbands and staff lined up to donate of pre-existing statute and regulations. The period that— new statute prevented the Government from blood. Shelters for the injured and ‘‘(I) begins on the date the President de- homeless sprang up out of office build- keeping that promise. The breach substan- clares a national emergency under the Na- tially impaired the value of the contracts. tional Emergencies Act (50 U.S.C. 1601 et ings, restaurants and small businesses. And therefore the Government must give the seq.); and Financial donations alone exceeded $1 companies their money back.’’ Id. at 624 (in- ‘‘(II) ends on the expiration of the 1-year billion. ternal citations and quotation marks omit- period beginning on the date of the termi- If there is ever any silver lining in ted). nation of the national emergency; and this national tragedy that this awful Just as was the case in the S & L and oil ‘‘(ii) the term ‘disaster period’ means the 1- atrocity created upon the people of this drilling situations, the proposed legislation year period beginning on the date the Presi- here would deprive the party contracting land, it is this: We saw the incarnation dent declares an emergency or major dis- of the American spirit again, the true with the government—in this case, BMS— aster under the Robert T. Stafford Disaster the right to the benefit of the bargain it had Relief and Emergency Assistance Act (42 strength of our country, the true, in- struck with the United States. This breach U.S.C. 5121 et seq.).’’. deed, the blessed meaning of the United by the government would entitle BMS to (b) VIOLATIONS OF OTHER LAWS ENFORCED States of America. bring suit in the Court of Federal Claims BY THE FEDERAL TRADE COMMISSION.—Sec- But as with this and any disaster, under several theories of contract law, and tion 13 of the Federal Trade Commission Act there are unscrupulous people who will would expose the United States to expensive (15 U.S.C. 53) is amended by adding at the and protracted litigation. take advantage of that generosity. Un- end the following: fortunately, this national emergency The SPEAKER pro tempore (Mr. ‘‘(e)(1) If a person, partnership, or corpora- was no different. On the heels of the FORBES). All time has expired. tion is found, in an action under subsection The question is on the motion offered (b), to have committed a violation involving September 11 atrocities, we heard sto- by the gentleman from Louisiana (Mr. an unfair or deceptive act or practice in an ries of scam telemarketers and scam emergency period or a disaster period, and if charities trying to collect for ‘‘disaster TAUZIN) that the House suspend the the act or practice exploits popular reaction relief’’ and crooks appearing to be af- rules and pass the bill, H.R. 2887, as to the national emergency, major disaster, amended. filiated with fire department fund-rais- or emergency that is the basis for such pe- ing groups going door-to-door asking The question was taken. riod, the court, after awarding equitable re- The SPEAKER pro tempore. In the lief (if any) under any other authority of the for funds. H.R. 2985 is aimed directly at opinion of the Chair, two-thirds of court, shall hold the person, partnership, or these scam artists. those present have voted in the affirm- corporation liable for a civil penalty of not The American Spirit Fraud Preven- ative. more than $22,000 for each such violation. tion Act declares frauds during these Mr. BROWN of Ohio. Mr. Speaker, on ‘‘(2) In this subsection— times to be different. H.R. 2985 allows that I demand the yeas and nays. ‘‘(A) the term ‘emergency period’ means the Federal Trade Commission to in- The yeas and nays were ordered. the period that— crease civil penalties for unfair and de- ‘‘(i) begins on the date the President de- The SPEAKER pro tempore. Pursu- clares a national emergency under the Na- ceptive acts or practices that exploit ant to clause 8 of rule XX and the tional Emergencies Act (50 U.S.C. 1601 et this Nation’s reaction to a national Chair’s prior announcement, further seq.); and emergency or a national disaster. With proceedings on this motion will be ‘‘(ii) ends on the expiration of the 1-year this bill, the FTC can collect up to postponed. period beginning on the date of the termi- $22,000 in civil penalties for each and f nation of the national emergency; and every violation. This will send a strong ‘‘(B) the term ‘disaster period’ means the 1- and unequivocal message to criminals AMERICAN SPIRIT FRAUD year period beginning on the date the Presi- hoping to prey on the kindness of PREVENTION ACT dent declares an emergency or major dis- strangers, ‘‘You will pay.’’ Mr. TAUZIN. Mr. Speaker, I move to aster under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 I want to thank the gentleman from suspend the rules and pass the bill U.S.C. 5121 et seq.).’’. Georgia (Mr. DEAL) and the gentleman (H.R. 2985) to amend the Federal Trade The SPEAKER pro tempore. Pursu- from New Hampshire (Mr. BASS), the Commission Act to increase civil pen- ant to the rule, the gentleman from original sponsors of the American Spir- alties for violations involving certain Louisiana (Mr. TAUZIN) and the gen- it Fraud Prevention Act. This is an ex- proscribed acts or practices that ex- tleman from New York (Mr. TOWNS) cellent bill. I strongly urge its passage. ploit popular reaction to an emergency each will control 20 minutes. I hope those who would scam the gen- or major disaster declared by the Presi- The Chair recognizes the gentleman erosity of Americans in this tragic dent, and to authorize the Federal from Louisiana (Mr. TAUZIN). time will pay attention tonight, be- Trade Commission to seek civil pen- cause, if they do not, the FTC will see alties for such violations in actions GENERAL LEAVE Mr. TAUZIN. Mr. Speaker, I ask you in court. brought under section 13 of that Act. Mr. Speaker, I reserve the balance of The Clerk read as follows: unanimous consent that all Members my time. H.R. 2985 may have 5 legislative days within which to revise and extend their re- Mr. TOWNS. Mr. Speaker, I yield my- Be it enacted by the Senate and House of Rep- self such time as I may consume. resentatives of the United States of America in marks and include extraneous material Congress assembled, on H.R. 2985. Mr. Speaker, as ranking member on SECTION 1. SHORT TITLE. The SPEAKER pro tempore. Is there this Subcommittee on Commerce, This Act may be cited as the ‘‘American objection to the request of the gen- Trade and Consumer Protection, I am Spirit Fraud Prevention Act’’. tleman from Louisiana? pleased to join the gentleman from

VerDate 06-NOV-2001 04:53 Nov 14, 2001 Jkt 099060 PO 00000 Frm 00073 Fmt 7634 Sfmt 0634 E:\CR\FM\A13NO7.091 pfrm02 PsN: H13PT1 H8108 CONGRESSIONAL RECORD — HOUSE November 13, 2001 Florida (Chairman STEARNS), the chair- peared. The Department of Justice, the I want to thank my colleagues on the man of the subcommittee, in cospon- Federal Trade Commission and the other side, of course, the gentleman soring H.R. 2985, the American Spirit States attorneys general have some from Florida (Mr. STEARNS), and of Fraud Prevention Act. The Committee powers to prosecute those engaged in course, the gentleman from Louisiana on Energy and Commerce has reported fraud and deceptive practices, but we (Mr. TAUZIN), and all the others on the the bill to the House by voice vote and must make it clear that we will se- Democratic side for the support of this without any amendments. verely punish those who aim to take legislation; because coming from New Mr. Speaker, this legislation says to advantage of America’s charity or an York and knowing in terms of the kind any con artist, do not even think about organization’s good name during an of tragedies that we have had over the it, trying to capitalize on national emergency. past few months, in terms of Sep- emergencies or disasters. It will not be Congress must also make sure that tember 11, and then yesterday in terms worth it. consumers are not inundated with false of the crash in Queens, New York, we For con artists that exploit popular and deceptive claims about goods and have had some tough times. I think reaction to a presidentially declared services that would exploit the cir- that we need to make certain that the emergency or major disaster, this bill cumstances of an emergency or dis- people do not go through a double kind requires the Federal Trade Commission aster. Whether it is selling Cipro or of tough time by people coming in and to double the maximum civil penalties other drugs under false information or defrauding them. from $11,000 to $22,000 per violation. offering fraudulent terrorist insurance, Mr. Speaker, I reserve the balance of The courts have said that each day the these practices must carry a penalty my time. fraud occurs constitutes a separate vio- commensurate with their nature. We Mr. TAUZIN. Mr. Speaker, I yield lation subject to the full civil pen- cannot let the detestable actions of so myself such time as I may consume. alties. In other words, it says crime few mar the pride and patriotism we all Mr. Speaker, let me thank my good does not pay. At $22,000 a day, it will be share over the phenomenal generosity friend, the gentleman from New York very costly for any scam artist to per- and outpouring of support from across (Mr. TOWNS) for his statement and petrate frauds that exploit the tragedy America and the world. We cannot let strong support of this legislation. More importantly, I thank him for his excel- of September 11 in New York City. the fear and anxiety of our citizens be lent cooperation on this and so many Fortunately, we have not seen a lot preyed upon by scam artists peddling pieces of legislation that we have of fraud involving the horrific events of their cheats and swindles. September 11. The FTC reports that it I have no doubt that the victims, worked together on in the Committee is investigating each and every com- their families and friends and all on Energy and Commerce. You are in- plaint that is made. So far, no frauds Americans are as humbled as I am with deed, sir, a great public servant. I want to thank you for that. have been identified by the FTC inves- the response of this country. Now we Let me also clarify something: This tigation, but let me tell you, those in- need to ensure that those who would bill amends the FTC statutes to deal vestigations are continuing. abuse this determined American spirit with fraud and scam artists. It does not Although there is no evidence yet of are equally staggered at our response. affect the issue that was heard before collections for phony charities or sales The American Spirit Fraud Preven- our committee just recently on the of gas masks or other products that do tion Act would double the penalties the question of what is being done with the FTC could levy during times of presi- not perform as advertised, the best way funds raised by legitimate charities, dentially declared emergencies and dis- to prevent fraud is to make sure it is such as the United Way and Red Cross. well known that fraud simply will not asters if the offending action aimed to This does not deal with that. I do not be tolerated. Experience has shown exploit the crisis. These times, sadly, want this bill confused with those good that, given the opportunity, fraud will occur more often than one might charities who do such good work occur. This legislation makes clear think, and the attempts to profit from around our country. that the price has just gone way up for them follow just as regularly. All hope taking advantage of people in a time of of profit and gain must be removed b 2030 crisis. from the equation of these people. On the other hand, I want to use this Mr. Speaker, I urge my colleagues to I just want to say that this effort opportunity to urge the American Red vote for H.R. 2985, the American Spirit would not have been possible without Cross, who I understand will be here to- Fraud Prevention Act. the support of the bill’s coauthor, my morrow for a press conference on the Mr. Speaker, I reserve the balance of friend, the gentleman from Georgia issue raised at our hearings, I think my time. (Mr. DEAL); the gentleman from Lou- just last week on the subject matter, I Mr. TAUZIN. Mr. Speaker, I am isiana (Chairman TAUZIN); the gen- want to urge the American Red Cross pleased to yield such time as he may tleman from Florida (Chairman to reconsider its position. Americans consume to the gentleman from New STEARNS); the ranking member, the all over this land, in small towns and Hampshire (Mr. BASS), one of the two gentleman from New York (Mr. hamlets and in rural settings, rose to authors of the legislation. TOWNS); and the entire Committee on the call of the Red Cross to donate Mr. BASS. Mr. Speaker, I thank the Energy and Commerce. I thank you all money to the victims and their fami- distinguished chairman of the com- for your help with this, and I urge its lies in New York and here in Wash- mittee for yielding me time. prompt passage. ington and the families in Pennsyl- Mr. Speaker, a little more than 2 Mr. TOWNS. Mr. Speaker, I yield my- vania who suffered on September 11, months ago, America was visited by an self 2 minutes. and raised the unprecedented, I think, unspeakable horror. For the first time Mr. Speaker, this legislation gives $547 million for the Red Cross for that in more than a century and a half, this the FTC the power to protect the con- special purpose. Nation was attacked viciously on its sumers. Quite often, when people are To divert those funds to some other own home territory. grieving, they become extremely vul- purpose, I believe, in my humble opin- In the weeks since September 11, the nerable, and people will go in and take ion, would not be consistent with hon- Nation has mourned, has expressed advantage of them. But this legislation oring the donations of these many mil- anger, has been anxious, concerned, but says that the teeth are there now, and lions of Americans to the families who also very generous. The American spir- that the FTC can protect people that suffered so horribly on September 11. it has reached levels that now stands have these kinds of problems. Those donations were made not to the as a symbol of this Nation’s greatness It is my understanding that we have Red Cross, but through the Red Cross and ability to support a just cause, the not had a lot of this up to this point, to those families. I think the more the relief of the victims of these tragedies but I think it would be foolish for us Red Cross does, the more the United and their families. not to put the legislation in place to Way does and the other charities do to But we have also seen the darker side let people know that if you do do it, get that money to those families, the of humanity. Reports of people using you will be penalized and you will be more the American public will appre- this tragedy and the generous Amer- penalized severely. I think this legisla- ciate it, and I think even be more gen- ican spirit for their own gain have ap- tion does that. erous to the Red Cross and the United

VerDate 06-NOV-2001 04:53 Nov 14, 2001 Jkt 099060 PO 00000 Frm 00074 Fmt 7634 Sfmt 0634 E:\CR\FM\K13NO7.121 pfrm02 PsN: H13PT1 November 13, 2001 CONGRESSIONAL RECORD — HOUSE H8109 Way and other charities when they are The question was taken; and (two- State’s Board of Trustees to name the new called upon again to respond for what- thirds having voted in favor thereof) world-class library after the Paternos, and at ever tragedies we may suffer, tornadoes the rules were suspended and the bill the dedication of the Paterno Library at or earthquake disasters this country was passed. Penn State’s University Park campus that A motion to reconsider was laid on occurred on September 8, 2000; may face in the future. Whereas Joe Paterno has received count- I understand the Red Cross may to- the table. less awards for being a role model and men- morrow simply say, if you do not like f tor for his players, a community leader, and what we are doing with the money, call PRAISING JOSEPH VINCENT a humanitarian and philanthropist who ex- us and we will refund it. That is not a PATERNO FOR HIS STEADFAST hibits and promotes the time-honored values good answer. That is a terrible answer. of selflessness, equality, dignity, educational COMMITMENT TO ACADEMICS, achievement, and community service; Americans do not want a refund. They SERVICE, AND CITIZENSHIP, AND want the money they donated for those Whereas Joe Paterno has accumulated all CONGRATULATING HIM FOR HIS 324 of his coaching wins at Penn State, where families to go to those families and MANY COACHING ACCOMPLISH- he is currently in his 52d season as an assist- they want the Red Cross and other MENTS ant or head coach; charities to honor those donations. Mr. ISAKSON. Mr. Speaker, I move Whereas Joe Paterno has been on the So again as a friend of the Red Cross, coaching staff during more than half of all as a supporter of the Red Cross, as a to suspend the rules and agree to the the football games played at Penn State great supporter of the United Way, this resolution (H. Res. 276) praising Joseph since the football program began in 1887; Congress has always supported those Vincent Paterno for his steadfast com- Whereas Joe Paterno’s coaching career has institutions, I want to urge the Red mitment to academics, service, and spanned 11 United States Presidential ad- citizenship, and congratulating Joseph Cross again to reconsider their posi- ministrations; Vincent Paterno for his many coaching Whereas Joe Paterno led Penn State to 2 tion. Those monies were not donated accomplishments, including his 324th national championships, in 1982 and 1986; for a reserve account, they were do- career coaching victory. Whereas Joe Paterno led Penn State to 5 nated through you to the families who The Clerk read as follows: perfect seasons, in 1968, 1969, 1973, 1986, and suffered on September 11. You ought to 1994; H. RES. 276 have the decency to make sure those Whereas Joe Paterno has won 20 bowl families get that money as quickly as Whereas Joseph Vincent Paterno coached games at Penn State, an NCAA record; the Penn State Nittany Lions football team Whereas Joe Paterno is the only coach to you can, because doggone it, that is to a 29 to 27 victory over the Ohio State what Americans intended when they have won all 4 traditional New Year’s Day Buckeyes on October 27, 2001, at Beaver Sta- Bowl games—the Rose, Sugar, Cotton, and sent that money into you in such dium in Happy Valley with 108,327 patrons in Orange Bowls—as well as the Fiesta Bowl; record amounts. attendance; Whereas the American Football Coaches Mr. DEAL of Georgia. Mr. Speaker, the trag- Whereas that victory was Joe Paterno’s Association has named Joe Paterno the ic events of September 11, 2001 were a blow 324th career coaching victory, making him Coach of the Year an unprecedented 4 times, to this nation. The attacks showed we were the winningest Division I–A football coach in in 1968, 1978, 1982, and 1986; NCAA history; Whereas Joe Paterno has coached 55 first- vulnerable to an outside attack. As bad as Whereas Joe Paterno launched what he team All-Americans; these attacks were, they did showcase the termed ‘‘The Great Experiment’’ on Feb- Whereas Joe and Sue Paterno are blessed spirit of America. We, as Americans, did not ruary 19, 1966, upon being named the head with 5 children and 9 grandchildren; football coach at the Pennsylvania State roll over, we came together and showed the Whereas Joe Paterno’s traditional game- University (Penn State); world why this land is great. day attire of coat and tie, rolled pantleg Whereas Joe Paterno defined ‘‘The Great One way many decided to help was through cuffs, white socks, and black football shoes Experiment’’ as a demonstration that Divi- financial donations to any one of numerous is recognized in sporting circles across the sion I student-athletes can achieve greatness charitable organizations to help those in need. Nation; on the field while excelling in the classroom, Whereas Joe Paterno is affectionately As we have seen over the past several and can become valuable assets to the com- months, Americans have been very generous munity in their postgraduate endeavors; known as ‘‘JoePa’’ to his extended Penn in their giving. The best of America has been Whereas Joe Paterno has nurtured 21 first- State family and to the rest of the football on display. However, just underneath the sur- team Academic All-Americans, 14 Hall of world; and Whereas Joe Paterno received a touching face of these kind souls, is a group of individ- Fame Scholar-Athletes, and 17 NCAA post- graduate scholarship winners; retrospective from his high school mentor at uals that try to take advantage of tragic events the Brooklyn Preparatory School, the late and people’s generosity. Whereas from 1996 to 2000 Joe Paterno nur- tured 69 Academic All-Big Ten football hon- Father Thomas Bermingham, who said: ‘‘The There are people out there who try to scam orees, more than any other Big Ten Con- Father gave me the sense that I was being money and say it is for relief efforts. They use ference institution during that period; handed a treasure. Joe is a treasure.’’: Now, the telephone and Internet in order to solicit Whereas according to the 2000 NCAA Grad- therefore, be it donations. The problems lies in the fact that uation Rate Report, the 4-year graduation Resolved, even though on the surface these solicitations rate of Joe Paterno’s Penn State players was SECTION. 1. JOSEPH VINCENT PATERNO. 76.5 percent, significantly above the 48 per- seem legitimate, they are not. The money usu- The House of Representatives— ally goes directly into the person’s pocket and cent national average; Whereas Joe Paterno and his wife Sue have (1) praises Joseph Vincent Paterno for his never is used to help those in need. For this continually demonstrated their loyalty and steadfast commitment to academics, service, reason, I am proud to have been able to work commitment to Penn State through volun- and citizenship; with the gentleman from New Hampshire on teer efforts and contributions, including a (2) congratulates Joseph Vincent Paterno this bill. It is important to make the penalties $3,500,000 gift—the most generous gift ever for his many coaching accomplishments, in- for fraud during times of national emergency given to a university by a coach and his fam- cluding his 324th career coaching victory; so high, no one will attempt such deeds. It is ily—for academic scholarships, faculty en- and dowments, and campus construction (3) thanks Joseph Vincent Paterno for his also important that we send a message to the contributions to college football, to the American people that such frauds will not be projects; Whereas immediately following his first Commonwealth of Pennsylvania, and to the tolerated and they can feel safe in the fact that national championship in January of 1983, Nation. anyone who perpetrates such crimes will be Joe Paterno bypassed the customary accept- SEC. 2. TRANSMITTAL. punished. Let the American spirit shine ance speech and instead pressed the Univer- through and may we continue to help those in The Clerk of the House of Representatives sity’s Board of Trustees to make Penn State shall transmit a copy of this resolution to need. number one in academics as well as athletics Joseph Vincent Paterno and to the President Mr. TAUZIN. Mr. Speaker, I urge and began advocating for the libraries of of the Pennsylvania State University. adoption of the bill, and I yield back Penn State; the balance of my time. Whereas Joe and Sue Paterno subsequently The SPEAKER pro tempore. Pursu- The SPEAKER pro tempore (Mr. served as Co-Chairs of the Campaign for the ant to the rule, the gentleman from Library which raised $11,000,000 for an expan- FORBES). The question is on the motion Georgia (Mr. ISAKSON) and the gen- sion effort that would double the size of the offered by the gentleman from Lou- tleman from New Jersey (Mr. PAYNE) existing library at Penn State’s University each will control 20 minutes. isiana (Mr. TAUZIN) that the House sus- Park campus; pend the rules and pass the bill, H.R. Whereas the Paternos’ generosity and vi- The Chair recognizes the gentleman 2985. sion were recognized by the vote of Penn from Georgia (Mr. ISAKSON).

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