CWA Statement on the Letter Sent by Reps. Bishop and Fitzpatrick to US Trade Representative Ron Kirk

Washington, DC— The Communications Workers of America today stated their strong support for the continuing efforts by Rep. Tim Bishop (D-NY) and Rep. Mike Fitzpatrick (R-PA) to shed light on the ongoing crises of rampant consumer identity theft in foreign call centers, as their bi-partisan legislative effort to remedy this serious problem gains more support.

The letter to U.S. Trade Representative Ron Kirk states in part:

In an increasingly global economy, countless call centers are relocating from the United States to foreign shores. Conservative estimates place call center job losses in the United States at over 500,000 in the countries like India, the Philippines, and China. In the Philippines, the outsources industry is expected to pull in $13 billion and provide 650,00 jobs in 2012; India employs roughly 330,000 call center workers and earns about $6 billion per year through the BPO industry.

While some corporations may see inflated profit margins due to outsourcing practices, such profits come at the expense of the safety and security of sensitive American consumer data. Foreign call centers are not subject to the same rigorous oversight as their American counterparts, exposing consumer data to far greater risks than those posed domestically. Once a company outsources call center work to a foreign hub, it becomes impossible for outsourcing companies to assure the American people that valuable personal data is being treated with the same sensitivity or protection as it would in the United States.

A CWA April 2012 report on consumer data theft flags the same concerns over consumer data related issues:

• Information from an alarming investigation by The Sunday Times: The investigation details the existing black market for consumer data in India, and shows how easily undercover reporters were able to access and purchase valuable consumer data.

• The U. S. Federal Trade Commission (FTC) uncovered a telemarketing scam operating out of an Indian call center: Employees pretended to be from a debt collection agency and defrauded Americans out of over $5 million.

• Foreign entities and affected corporations are downplaying the incidence and risk of consumer data fraud: According to the recent Sunday Times investigation, “the Indian government — anxious to preserve the reputation of an industry worth an estimated £3.7 billion a year — described it as a “freak incident.” Additionally, a police source told The Sunday Times that “British companies are reluctant to report such breaches for fear of the potential adverse publicity.”

• Despite concerns, further plans to offshore call center jobs continue: T-Mobile is closing seven U.S. call centers, a development that will mean approximately 2,000 Americans will be out of work. T-Mobile USA took over $61 million in state and local recruitment subsidies to originally locate these call center jobs in the U.S. Similarly, Wells Fargo recently announced plans to expand its call center operation in the Philippines – after earlier laying off hundreds of American workers by shuttering call centers in such locations as California, Florida, and Pennsylvania. Meanwhile, Wells Fargo received a $25 billion lifeline from the government via TARP.

Link to full CWA report:

http://files.cwa-union.org/national/News/Misc/20111215-offshore-callcenter.pdf

Link to USTR letter:

http://timbishop.house.gov/uploads/USTR_Call_%20center_breaches_41012.pdf

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Contact: Michael Earls 202-261-2388