EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0232*
SENATE BILL 232
O1, I1 5lr0335
(PRE–FILED) CF HB 175
By: Chair, Finance Committee (By Request – Departmental – Human Services)
Requested: October 3, 2024
Introduced and read first time: January 8, 2025
Assigned to: Finance
A BILL ENTITLED
AN ACT concerning 1
Electronic Benefits Transfer Cards – Restoration and Receipt of Benefits and 2
Use at Automated Teller Machines 3
FOR the purpose of requiring, subject to a certain provision of law, the Department of 4
Human Services to reimburse a beneficiary for any benefits lost due to the fraudulent 5
use of the beneficiary’s Electronic Benefits Transfer card and restore the benefits 6
without further action from the household; requiring the Department to reimburse 7
a beneficiary on or before a certain date for any benefits lost due to the fraudulent 8
use of the beneficiary’s Electronic Benefits Transfer card that occurred between 9
certain dates, and requiring the beneficiary to submit a claim to the Department by 10
a certain date to be eligible for reimbursement; requiring, on or before a certain date, 11
each operator of an automated teller machine to ensure that the machine has certain 12
functionality relating to Electronic Benefits Transfer cards; and generally relating 13
to electronic benefits. 14
BY repealing and reenacting, with amendments, 15
Article – Human Services 16
Section 5–609 and 5–610 17
Annotated Code of Maryland 18
(2019 Replacement Volume and 2024 Supplement) 19
BY repealing and reenacting, with amendments, 20
Article – Financial Institutions 21
Section 1–401(d) 22
Annotated Code of Maryland 23
(2020 Replacement Volume and 2024 Supplement) 24
BY adding to 25
Article – Financial Institutions 26
Section 1–407 27 2 SENATE BILL 232
Annotated Code of Maryland 1
(2020 Replacement Volume and 2024 Supplement) 2
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 3
That the Laws of Maryland read as follows: 4
Article – Human Services 5
5–609. 6
(a) (1) In this section the following words have the meanings indicated. 7
(2) (i) “Personal identifying information” has the meaning stated in § 8
8–301 of the Criminal Law Article. 9
(ii) “Personal identifying information” includes an Electronic 10
Benefits Transfer card number or personal identification number. 11
(3) “Skimming practices” includes: 12
(i) use of a skimming device, including a scanner, skimmer, reader, 13
or other electronic device used to access, read, scan, obtain, memorize, or store, temporarily 14
or permanently, personal identifying information; or 15
(ii) adding malicious code illegally to a website to capture Electronic 16
Benefits Transfer card data or personal identifying information. 17
(4) “Theft” includes: 18
(i) physical theft of an Electronic Benefits Transfer card; 19
(ii) identity fraud, as defined in § 8–301 of the Criminal Law Article; 20
and 21
(iii) theft through skimming practices. 22
(5) “Two–way fraud alert” means the capability of the Department to 23
communicate with households, and of households to communicate with the Department, 24
through text messaging regarding potential fraudulent use or theft of an Electronic 25
Benefits Transfer card. 26
(b) (1) If an investigation by the Department shows a household’s correctly 27
issued benefits were lost due to theft, the Department [automatically] shall, SUBJECT TO 28
THE REQUIREMENTS OF § 5–610 OF THIS SUBTITLE , restore the benefits without 29
requiring further action from the household. 30
SENATE BILL 232 3
(2) As soon as practicable, but not later than 10 days after a household 1
informs the Department of the loss of benefits due to theft, the Department shall: 2
(i) notify the household in writing of the Department’s decision as 3
to whether to restore benefits, the amount of benefits to be restored, and the right to and 4
method of requesting a hearing on the Department’s decision in accordance with subsection 5
(c) of this section; 6
(ii) if the Department determines that the household receives 7
benefits, restore benefits to the household in the amount of benefits that was lost; and 8
(iii) provide the household with a new Electronic Benefits Transfer 9
card. 10
(3) The Department may not: 11
(i) require a household to provide a police report as a condition of 12
restoration of benefits; or 13
(ii) limit the number of months in which a household can receive 14
restoration of benefits lost due to theft. 15
(c) (1) If a household disputes the amount of benefits restored or the 16
Department’s determination that no restoration is due, the household may request a 17
hearing with the Department within 90 days after the date of the Department’s 18
determination. 19
(2) If a household requests a hearing under this subsection, the 20
Department shall restore the benefits for which the household claims entitlement while the 21
hearing is pending. 22
(3) If the hearing decision is unfavorable to the household, any benefits 23
improperly restored under paragraph (2) of this subsection may be recovered by the 24
Department by reducing the household’s benefit at a rate that may not exceed the lesser of 25
$10 or 5% of the household’s monthly allotment of benefits. 26
(d) In the procurement process for electronic benefits distribution or 27
administration, the State or State–aided or State–controlled entity shall give preference to 28
a vendor that: 29
(1) holds a form of insurance that can be used to reimburse a beneficiary 30
for identity fraud or theft; and 31
(2) provides identity access protections to protect an eligible beneficiary 32
against identity fraud and theft, which may include multifactor authentication. 33
4 SENATE BILL 232
(e) The Department shall coordinate with vendors to take available precautions 1
to reduce the vulnerability of Electronic Benefits Transfer cards to theft by utilizing 2
enhanced technology. 3
(F) SUBJECT TO THE LIMITA TIONS OF THE STATE BUDGET AND 4
SUBSECTION (B) OF THIS SECTION , THE DEPARTMENT SHALL REST ORE BENEFITS 5
TO A HOUSEHOLD AS PROVIDED FOR BY A N APPROPRIATION FOR THE PURPOSES OF 6
ELECTRONIC BENEFIT T HEFT RESTORATION . 7
[(f)] (G) On or before December 1 each year, the Department, in consultation 8
with local law enforcement agencies in the State, shall report to the General Assembly, in 9
accordance with § 2–1257 of the State Government Article, on: 10
(1) the accessibility and security of Electronic Benefits Transfer cards; 11
(2) actions taken to reduce the fraudulent use of Electronic Benefits 12
Transfer cards; 13
(3) the number of Electronic Benefits Transfer cards reissued due to fraud 14
in the immediately preceding year; 15
(4) the number of households reporting theft of benefits, by jurisdiction and 16
program; 17
(5) the number of households eligible for expedited Supplemental 18
Nutrition Assistance Program benefits that reported loss of benefits due to theft, by 19
jurisdiction and program; 20
(6) the total dollar amount of benefits reported lost due to theft, by 21
jurisdiction and program; 22
(7) the number of determinations of theft made by the Department, by 23
jurisdiction; 24
(8) the number of determinations made by the Department that theft did 25
not occur, by jurisdiction; 26
(9) the number of households reimbursed for benefits lost due to theft and 27
the total dollar amount of benefits restored, by jurisdiction and program; 28
(10) the average and maximum length of time, in days, between the report 29
of theft and the restoration of benefits, by jurisdiction; 30
(11) the number of hearings requested and the number of households that 31
received a restoration of benefits as an outcome of a hearing, by jurisdiction; and 32
SENATE BILL 232 5
(12) demographic data on households that experienced theft, including race, 1
gender, number of households with children under the age of 18 years, and number of 2
households with a member at least 60 years old. 3
5–610. 4
(a) The Department [may] SHALL: 5
(1) restore benefits to any household that lost benefits due to theft that 6
occurred between January 1, 2021, and [October 1, 2022] JULY 1, 2025, both inclusive, 7
provided that the Department confirms the household lost benefits due to theft during that 8
time period; and 9
(2) support innovative practices required to support beneficiaries during 10
the time period between the reporting of the loss of benefits due to theft and the restoration 11
of benefits. 12
(b) On or before [September 1, 2023] SEPTEMBER 30, 2026, the Department 13
shall issue benefits to households eligible to receive funds under subsection (a) of this 14
section. 15
(C) ANY CLAIM FOR THE RES TORATION OF LOST BENEFITS DUE TO THEF T 16
THAT OCCURRED BETWEE N JANUARY 1, 2021, AND JULY 1, 2025, BOTH INCLUSIVE , 17
SHALL BE SUBMITTED T O THE DEPARTMENT ON OR BEFO RE JUNE 30, 2026. 18
(D) ANY RESTORATION OF LO ST BENEFITS DUE TO THEFT IN THIS SEC TION 19
IS SUBJECT TO THE LIMIT ATIONS OF THE STATE BUDGET . 20
Article – Financial Institutions 21
1–401. 22
(d) (1) “Automated teller machine” means any electronic information 23
processing device located in this State which [accepts]: 24
(I) ACCEPTS or dispenses cash in connection with a credit, deposit, 25
or convenience account; AND 26
(II) PROCESSES AND DISPENSES CASH F ROM AN ELECTRONIC 27
BENEFITS TRANSFER CARD . 28
(2) “Automated teller machine” does not include devices used: 29
(i) Solely to facilitate check guarantees or check authorizations; 30
6 SENATE BILL 232
(ii) In connection with the acceptance or dispensing of cash on a 1
person–to–person basis, including by a store cashier; or 2
(iii) For the payment of goods or services. 3
1–407. 4
ON OR BEFORE JANUARY 1, 2026, EACH OPERATOR OF AN AUTOMATED 5
TELLER MACHINE SHALL ENSURE THAT THE MACHINE HAS THE FUNCTIONALITY TO 6
PROCESS AND DISPENSE CASH FROM AN ELECTRONIC BENEFITS TRANSFER CARD . 7
SECTION 2. AND BE IT FURTHER ENACTED, That this Act sha ll take effect July 8
1, 2025. 9