Statement of Commissioner Terrell McSweeny 

Before the United States Senate Committee on Commerce, Science, and Transportation
 

Subcommittee on Consumer Protection, Product Safety, and Data Security 

March 21, 2017 

Chairman Moran, Ranking Member Blumenthal: thank you for holding this important hearing. I 

am Terrell McSweeny, and along with Acting Chairman Ohlhausen, we are the current members 

of the Federal Trade Commission. 

The work of protecting American consumers from frauds and scams is bipartisan – in fact, I 

would call it non-partisan. For more than 100 years, the FTC has protected consumers from 

dishonest practices, although the particular scams we see in the marketplace change over time. 

In 2016, we received more than three million consumer complaints. The top three categories of 

complaints were debt collection, impostor frauds, and identity theft. Since not all victims file 

complaints, these statistics likely understate the problem. The FTC’s most recent national survey 

of fraud victimization estimated that 10.8% of all Americans over age 18 – or 25.6 million 

people – had been a victim of fraud in 2011. 

The growth in impostor scam complaints is striking; they surpassed the number of identity theft 

complaints for the first time ever last year. In imposter scams someone poses as a friend, family 

member, romantic interest, legitimate company, or government agency, in order to obtain money 

or personal information. 

Government impostor scams – the most common type of imposter scam reported last year – run 

the gamut from callers claiming to be from the IRS and demanding payment for back taxes to 

debt collectors claiming to be from a law enforcement agency. 

Other impostors purport to be calling on behalf of a company such as Microsoft or Apple. They 

convince consumers that their computers are infected with malware. In reality no virus exists, 

but consumers pay for costly “technical support” services with little, if any, value. 

We are taking action to stop these scams. Last year we brought multiple cases against tech 

support scams, as well as an action against an entity that was impersonating the Department of 

Transportation. 

Stopping fraud is a core FTC priority. This includes not just pursuing bad actors who are directly 

perpetrating the frauds, but also others whose facilitate scams. One example is our recent case 

against Western Union, which paid $586 million to settle charges that it failed to stop scammers 

from using its money transfer system to collect payments for numerous types of fraud – 

including many of the types of scams we are talking about today. 
Protecting consumers is too big a job for the FTC to do alone. That’s why we partner with other 

government agencies, states, and civic organizations in our anti-fraud work – and why we invest 

in consumer and business education. 

Educating American consumers is one of the best ways we can combat fraud. We produce 

materials in multiple languages for almost every demographic and make them available across 

platforms to reach the broadest possible audience. We hold Ethnic Media Roundtables around 

the country to help diverse communities highlight frauds affecting them. 

We also have a campaign to help older people learn about common scams and pass that 

information on to their peers. And we work closely with the Department of Defense and others to 

help the military community avoid fraud. 

It is vital that we continue this important outreach – and ensure that we have the resources to 

meet the demand for our materials. This is especially true for our educational materials for 

parents and children, which help parents keep their kids safe online. These materials need to be 

updated to remain relevant, including optimizing them for mobile platforms. 

The FTC must continue to stay abreast of emerging consumer protection issues. Our always-on, 

always-connected digital world is full of marvelous innovations – but it also creates some new 

opportunities for bad actors. Imposter scams are just one example. 

I’m particularly concerned about the growth in ransomware attacks. Ransomware attacks on 

computers – both for individuals and businesses – are unfortunately already well known. But I 

worry that attacks on connected consumer devices will soon become more common – especially 

given wide-ranging industry data security practices. In the not-too-distant future a consumer 

might turn on her smart TV only to see a message that asks for $50 in Bitcoin if she wants to 

watch television again. 

In a world of new cyber threats, the FTC must keep pace with changing technology. We have 

been doing that by engaging with stakeholders – and, most importantly, bringing technologists 

on board. The FTC’s Office of Technology Research and Investigation, or OTech, is in its 

second year. 

OTech is a talented inter-disciplinary team of lawyers and computer scientists who provide us 

with in-house research capabilities and the expertise to understand cutting-edge technology – like 

cross-device tracking, or how algorithms impact consumer choice. As more of these 

technologies come into the marketplace, it is vital that the FTC continue to expand these 

capabilities. 

As our complaint data indicate, scammers are finding creative new ways to target consumers. It 

is vital that the FTC have the proper resources to keep pace with them. As we will discuss today, 

our consumer protection mission has a big impact on people’s lives. Last year alone we obtained 

orders that will return more than $11 billion in redress directly to consumers – which is more 

than 35 times our annual operating budget. 

2 
Our enforcement actions not only provide American consumers with justice, they help foster 

consumer trust in the marketplace, strengthening the dynamism of the American economy itself. 

Thank you again for holding this hearing. I look forward to answering your questions. 

3