89R9338 BCH-F
By: Perez of Harris H.B. No. 4853
A BILL TO BE ENTITLED
AN ACT
relating to skimmers on electronic terminals; authorizing a civil
penalty; creating criminal offenses.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Title 12, Business & Commerce Code, is amended by
adding Chapter 607A to read as follows:
CHAPTER 607A. PAYMENT CARD SKIMMERS ON ELECTRONIC TERMINALS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 607A.001. DEFINITIONS. In this chapter:
(1) "Automated teller machine" has the meaning
assigned by Section 31.03, Penal Code.
(2) "Center" means the financial crimes intelligence
center established under Chapter 2312, Occupations Code.
(3) "Electronic terminal" means an electronic device,
other than a telephone operated by a consumer, through which a
consumer may initiate an electronic funds transfer. The term
includes a point-of-sale terminal, motor fuel unattended payment
terminal, virtual currency terminal, automated teller machine, and
cash dispensing machine.
(4) "Financial institution" has the meaning assigned
by Section 277.001, Finance Code.
(5) "Institution of higher education" has the meaning
assigned by Section 61.003, Education Code.
(6) "Merchant" has the meaning assigned by Section
2.104.
(7) "Payment card" has the meaning assigned by Section
522.001.
(8) "Payment card issuer" means a lender, including a
financial institution, or a merchant that receives applications and
issues payment cards to individuals.
(9) "Payment card network" means an entity that
directly, or through a licensed member, processor, or agent,
provides the proprietary services, infrastructure, and software
that:
(A) route information to conduct debit card or
credit card transaction authorization, clearance, and settlement;
and
(B) the entity uses to accept as a form of payment
a brand of debit card, credit card, or other device to be used to
carry out debit or credit transactions.
(10) "Service company" and "service technician" have
the meanings assigned by Section 2310.151, Occupations Code.
(11) "Skimmer" means a wire or electronic device
capable of unlawfully intercepting electronic communications or
data to perpetrate fraud.
(12) "Virtual currency" means an intangible
electronic medium of exchange, unit of account, or store of value.
Sec. 607A.002. ADMINISTRATION AND ENFORCEMENT OF CHAPTER.
The center shall administer and enforce this chapter.
Sec. 607A.003. RULES. The center shall adopt rules for
administering this chapter.
SUBCHAPTER B. DUTIES FOR USE OF CERTAIN ELECTRONIC TERMINALS
Sec. 607A.051. REQUIRED NOTICE OF SKIMMER DISCOVERY. (a)
If a service technician discovers a skimmer in or on an electronic
terminal, the service technician or service company that employs
the technician shall notify the center and the merchant of the
skimmer in the manner prescribed by center rule.
(b) If a merchant discovers a skimmer in or on an electronic
terminal or is notified of the presence of a skimmer, the merchant
shall, in the manner prescribed by center rule:
(1) disable, or cause to be disabled, the electronic
terminal on which the skimmer was discovered;
(2) notify a law enforcement agency and the center
that a skimmer has been detected; and
(3) take appropriate measures to protect the
electronic terminal from tampering until the center or law
enforcement agency arrives and the skimmer is removed.
Sec. 607A.052. REPORT TO CENTER. The center may accept a
report of a suspected skimmer from any interested person,
including:
(1) a law enforcement agency;
(2) a financial institution;
(3) a payment card issuer;
(4) a service technician or service company;
(5) a member of the public; and
(6) a payment card network.
Sec. 607A.053. INVESTIGATION OF SKIMMER REPORT. (a) On
receipt of a report under Section 607A.051 or 607A.052, the center
may conduct an inspection for the presence of suspected skimmers.
(b) The center shall coordinate with law enforcement
agencies in conducting an investigation of the report.
(c) If the skimmer is reported to be located on an
electronic terminal, the center may inspect, directly or in
coordination with a law enforcement agency, the electronic terminal
that is the subject of the report and any other electronic terminal
located at the same place of business if the electronic terminal is
not affiliated with a federally insured financial institution.
(d) A merchant shall cooperate with the center or law
enforcement agency during an investigation of a skimmer discovered
or reported at the merchant's place of business and allow the
inspection and alteration of an electronic terminal at the place of
business as necessary.
Sec. 607A.054. CONFIDENTIALITY. (a) Except as otherwise
provided by this section, information is confidential and not
subject to disclosure under Chapter 552, Government Code, if the
information is:
(1) from a report received by the center under Section
607A.051 or 607A.052; or
(2) prepared or compiled by the center in connection
with the report or an investigation conducted under this
subchapter.
(b) Information described by Subsection (a) may be
disclosed to:
(1) an institution of higher education;
(2) a law enforcement agency;
(3) a payment card issuer, a financial institution
that is not a payment card issuer, or a payment card network that
may be impacted by the use of a skimmer on an electronic terminal;
(4) another person if the disclosure of the
information is authorized or required by other law or court order;
(5) a trade association representing a financial
institution;
(6) a center contractor or other agent; or
(7) the Texas Department of Banking.
(c) The disclosure of information under Subsection (b) is
not a voluntary disclosure for purposes of Section 552.007,
Government Code.
(d) On the dismissal or final resolution of a report by the
center, information described by Subsection (a) is subject to
disclosure under Chapter 552, Government Code, unless the
information is subject to Section 31.301, Finance Code, or can be
classified as confidential information under applicable rules.
(e) Notwithstanding Subsection (a), a law enforcement
agency or the center:
(1) subject to Subdivision (2), may disclose to the
public information made confidential by that subdivision if the law
enforcement agency or the chief intelligence coordinator for the
center determines the disclosure of the information furthers a law
enforcement purpose; and
(2) may not disclose to the public the identity of a
person who submits a report of a suspected skimmer to the center
under Section 607A.051 or 607A.052.
SUBCHAPTER C. ENFORCEMENT
Sec. 607A.101. CIVIL PENALTY. (a) A person who violates
this chapter or a rule adopted under this chapter is liable to this
state for a civil penalty. A civil penalty assessed under this
subsection may not exceed $5,000 per day for each violation.
(b) The attorney general may bring an action to collect a
civil penalty under this section.
(c) An action filed under this section must be filed in a
district court in Travis County.
(d) The attorney general and the department may recover
reasonable expenses incurred in obtaining injunctive relief under
this section, including court costs, reasonable attorney's fees,
investigative costs, witness fees, and deposition expenses.
Sec. 607A.102. CRIMINAL OFFENSES. (a) A person commits an
offense if the person refuses to allow an inspection of an
electronic terminal at the merchant's place of business in
violation of Section 607A.053. An offense under this subsection is
a Class C misdemeanor.
(b) A person commits an offense if the person negligently or
recklessly disposes of a skimmer that was installed on an
electronic terminal by another person. An offense under this
subsection is a Class B misdemeanor.
(c) A person commits an offense if, knowing that an
investigation is ongoing or that a criminal proceeding has been
commenced and is pending, the person disposes of a skimmer
installed on an electronic terminal by another person. An offense
under this subsection is a felony of the third degree.
SECTION 2. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2025.