Texas Senate Bill SB2032

Texas 2019 - 86th Regular

Caption

Relating to payment card skimmers and the creation of a payment card fraud center; imposing a civil penalty; creating criminal offenses.

Impact

The bill significantly impacts Texas law by creating Chapter 607 in the Business & Commerce Code, which outlines merchant duties and the creation of a payment card fraud center under Chapter 424 of the Government Code. This center will serve as the primary entity for coordinating law enforcement responses to payment card fraud. Moreover, the establishment of standardized rules and a penalty structure for noncompliance emphasizes the state's commitment to reducing payment card fraud and enhancing consumer protection services.

Summary

SB2032 aims to address the growing issue of payment card fraud by implementing measures related to payment card skimmers and establishing a centralized payment card fraud center in Texas. The bill defines 'skimmers' as electronic devices that unlawfully intercept payment card information and delineates the responsibilities of merchants regarding unattended payment terminals. Merchants are mandated to adopt specific procedures to detect, prevent, and report the installation of skimmers to combat fraudulent activities effectively.

Contention

While SB2032 aims to reduce incidents of fraud, it also raises concerns regarding the financial burden on smaller merchants who may struggle with compliance costs associated with the required reporting and preventive measures. Critics argue that the penalties for noncompliance, which can be as high as $2,500 per violation, could disproportionately impact smaller businesses. Additionally, the lack of clarity around the technological best practices that merchants must implement poses challenges for compliance, as the bill allows the attorney general to establish rules that might follow emerging technologies closely.