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Pretexting bill backed by FTC

The legislation would let the agency impose fines on those using deception to obtain phone records.

March 10, 2007|From Reuters

WASHINGTON — The Federal Trade Commission endorsed bipartisan legislation Friday that would let the agency impose civil fines on those using deceptive methods to obtain consumers' telephone records.

The bill would also impose new restrictions on phone company use of customers' personal phone records.

The measure is part of a broader crackdown after revelations last year that investigators hired by Hewlett-Packard Co. used false identities to obtain telephone records of directors, employees and journalists, a practice known as pretexting.

The HP case prompted Congress to pass a law last year making pretexting a criminal offense, punishable by as many as 10 years in prison.

Testifying before the House Energy and Commerce Committee, the head of the FTC's consumer protection bureau said the agency supported the latest bill, which is backed by committee Chairman John D. Dingell, a Michigan Democrat, and the panel's top Republican, Rep. Joe L. Barton of Texas.

An identical bill was passed by the committee last year but never reached the floor for a vote by the full House.

Local and wireless U.S. carriers told lawmakers Friday that they opposed a provision in the new bill that would require the companies to get "opt-in" consent from customers to be able to share details of personal phone records.

Such a requirement could interfere with their ability to sell packages of services, because customer records are used in marketing, they said.

"Consumers benefit when their communications carriers offer them new discount packages and innovative services," said Walter B. McCormick Jr., head of the U.S. Telecom Assn.

Industry representatives also said that the pretexting problem would be largely solved by the new law.

"Since enactment of that legislation, the market for pretexting services has evaporated under the threat of federal prison time and sizable financial penalties," said Steve Largent, president of CTIA-the Wireless Assn., a trade group that represents cellphone carriers.

The FTC said at Friday's hearing that it had filed five lawsuits since May against online "data brokers" who advertised that they could obtain confidential phone records from the carriers for fees ranging from $65 to $180.

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