Threat of Scams Heightened in Age of Coronavirus, Say House Consumer Protection Subcommittee Members

May 11, 2020 — The coronavirus pandemic has given birth to all-too-predictable scams, agreed members of the House Consumer Protection and Commerce Subcommittee and the Federal Trade Commission during a teleconference Monday.

The conference, hosted by Subcommittee Chair Jan Schakowsky, D-Ill., and Ranking Member Cathy McMorris Rodgers, R-Wash., featured FTC Chairman Joe Simons for a discussion about the FTC’s response to the increased fraudulent activity.

The scams take many forms, McMorris Rodgers said. “Whether it’s scams, robocalls, price-gouging, privacy and data security, or other fraud … the FTC is the top cop on the beat for protecting consumers from harm.”

FTC Chairman Joe Simons agreed, saying that the FTC has sent more than 120 warning letters to coronavirus scammers with a high degree of effectiveness.

“We’ve also pursued targeted federal law enforcement, and we’ve worked aggressively to educate consumers,” he said. “The FTC is monitoring the marketplace and will hold accountable those who take advantage of consumers’ financial distress, or their fears and anxiety about COVID-19.”

In April, Rep. Schakowsky joined with Reps. David Cicilline, D-R.I., Frank Pallone, D-N.J. and Jerry Nadler, D-N.Y. to introduce legislation that would “prohibit the sale of consumer goods and services at an unconscionably excessive price.”

The FTC would be interested in prosecuting price-gouging if Congress passed such a law, Simons said. Although he conceded that the agency does not currently have the authority, he told the congresswomen that he “would be very much willing, eager, and enthusiastic and interested in protecting consumers under any statute that you provide.”

The FTC has warned several high-profile individuals to stop selling sham cures for the coronavirus, including televangelist Jim Bakker. On a February broadcast of “The Jim Bakker Show,” Bakker and “natural health expert” guest Sherrill Sellman suggested that Bakker’s “Silver Solution” could cure the coronavirus.

“This influenza that is now circling the globe,” Bakker said, “you’re saying that Silver Solution would be effective.”

“Well, let’s say it hasn’t been tested on this strain of the coronavirus, but it has been tested on other strains of the coronavirus and has been able to eliminate it within 12 hours,” Sellman said. “Totally eliminate it. Kills it. Deactivates it.”

Soon after, the state of Missouri filed a lawsuit against Bakker and his production company, Morningside Church Productions. The FCC and the FDA also warned Bakker that he was hawking unapproved new drugs.

Simons said that fighting such scams was not merely a matter of taking legal action but also of informing consumers.

“For all of these scams and other scams, we’re doing extensive outreach and consumer education,” he said. “And you know we’re going to just continue to be aggressive and bring law enforcement appropriate actions as appropriate.”