Intelligence Center Widens To Retail Theft, Gets 15-Member Committee

The text as introduced · 2,219 words

89R15796 JCG-F

By: Cook
H.B. No. 4301

A BILL TO BE ENTITLED

AN ACT

relating to the financial crimes intelligence center, including

the establishment of an advisory committee and grants supporting

the investigation and prosecution of certain offenses.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Chapter 2312, Occupations Code, is transferred

to Subtitle B, Title 4, Government Code, redesignated as Chapter

426, Government Code, and amended to read as follows:

CHAPTER 426 [ 2312 ]. FINANCIAL CRIMES INTELLIGENCE CENTER

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 426.001 [ 2312.001 ]. DEFINITIONS. In this chapter:

(1) "Card fraud" means conduct constituting an [ act

that constitutes the ] offense [ of fraudulent use or possession of a

credit card or debit card ] under Section 32.315, Penal Code. The

term includes the commission of the offense by use of a skimmer.

(2) "Cargo theft" means conduct constituting an

offense under Section 31.18, Penal Code.

(3) [ (2) ] "Center" means the financial crimes

intelligence center established under this chapter.

(4) "Chief" means the chief intelligence coordinator

appointed to supervise and manage the operation of the center under

Section 426.053.

(5) [ (3) ] "Commission" means the Texas Commission of

Licensing and Regulation.

(6) [ (4) ] "Department" means the Texas Department of

Licensing and Regulation.

(7) "Law enforcement agency" means an agency of this

state or a political subdivision of this state authorized by law to

appoint or employ peace officers.

(8) "Mail theft" means conduct constituting an offense

under Section 31.20, Penal Code.

(9) "Organized retail theft" means conduct

constituting an offense under Section 31.16, Penal Code.

(10) "Prosecutor" means a district attorney, a

criminal district attorney, or a county attorney who may prosecute

criminal offenses.

(11) [ (5) ] "Skimmer" means an electronic, mechanical,

or other device that may be used to unlawfully intercept electronic

communications or data to perpetrate card fraud.

(12) "Theft of service" means conduct constituting an

offense under Section 31.04, Penal Code.

(13) "Unauthorized acquisition or transfer of certain

financial information" means conduct constituting an offense under

Section 31.17, Penal Code.

Sec. 426.002 [ 2312.002 ]. RULES. The commission shall

adopt rules as necessary to implement this chapter.

SUBCHAPTER B. PURPOSE AND ADMINISTRATION ; LAW ENFORCEMENT AGENCY

AND PROSECUTOR DUTIES

Sec. 426.051 [ 2312.051 ]. FINANCIAL CRIMES INTELLIGENCE

CENTER ESTABLISHED. The commission shall establish the center

within the department.

Sec. 426.052 [ 2312.052 ]. PURPOSES OF CENTER. The purposes

of the center are to:

(1) serve as the state's primary entity for the

planning, coordination, and integration of law enforcement

agencies and other governmental agencies that respond to criminal

activity related to card fraud and organized retail theft [ ,

including through the use of skimmers ]; and

(2) maximize the ability of the department, law

enforcement agencies, and other governmental agencies to detect,

prevent, and respond to criminal activities related to card fraud

and organized retail theft .

Sec. 426.053 [ 2312.053 ]. OPERATION AGREEMENTS AUTHORIZED;

CHIEF INTELLIGENCE COORDINATOR. (a) The department:

(1) may enter into agreements with law enforcement

agencies or other governmental agencies for the operation of the

center; and

(2) shall enter into an agreement with a law

enforcement agency or other governmental agency for the appointment

of a chief intelligence coordinator to supervise and manage the

operation of the center.

(b) The chief intelligence coordinator appointed under the

agreement required by Subsection (a)(2) may be a licensed peace

officer. The agreement must provide that the commission of a chief

intelligence coordinator who is a licensed peace officer will be

carried by the agency with which the department enters into the

agreement under that subdivision.

(c) Information a law enforcement agency or other

governmental agency collects and maintains under an agreement

entered into with the department under this chapter is the

intellectual property of the center. On termination of the

agreement, the contracting agency shall transfer the information to

the department in accordance with the terms of the agreement.

Sec. 426.054 [ 2312.054 ]. POWERS AND DUTIES. (a) The

center may collaborate with federal, state, and local governmental

agencies to accomplish the purposes of the center.

(b) The center shall assist law enforcement agencies, other

governmental agencies, financial institutions, credit card

issuers, debit card issuers, payment card networks, institutions of

higher education, and merchants in their efforts to develop and

implement strategies to:

(1) detect skimmers;

(2) ensure an effective response if a skimmer is

found; [ and ]

(3) prevent card fraud ; and

(4) detect and prevent organized retail theft .

(c) The center may:

(1) serve as a centralized collection point for

information related to card fraud and organized retail theft ;

(2) provide training and educational opportunities to

law enforcement;

(3) provide outreach to the public; and

(4) release information to affected financial

institutions, credit card issuers, debit card issuers, payment card

networks, institutions of higher education, and merchants if the

center does not consider the information to be sensitive to law

enforcement.

(d) For purposes of Subsection (c)(4), information is

considered sensitive to law enforcement if the information could

cause harm to law enforcement activities or jeopardize an

investigation or operation if disclosed.

Sec. 426.055 [ 2312.055 ]. ANNUAL REPORT. (a) Not later

than December 1 of each year, the chief intelligence coordinator

shall file a report with the department.

(b) The report must include:

(1) a plan of operation for the center and an estimate

of the amount of money necessary to implement that plan;

(2) an assessment of the current state of card fraud

and organized retail theft in this state, including:

(A) an identification of the geographic

locations in this state that have the highest statistical

probability for card fraud and organized retail theft ; and

(B) a summary of card fraud and organized retail

theft statistics for the year in which the report is filed;

(3) a detailed plan of operation for combatting card

fraud and organized retail theft ;

(4) a communications plan for outreach to law

enforcement agencies, financial institutions, credit card issuers,

debit card issuers, payment card networks, merchants, and the

public; and

(5) a list of expenditures made since the most recent

report was filed with the department.

Sec. 426.056. DUTIES OF LAW ENFORCEMENT AGENCIES AND

PROSECUTORS. (a) A law enforcement agency or prosecutor that is

investigating or prosecuting organized retail theft, card fraud,

cargo theft, fraud involving gift cards and related to organized

retail theft, mail theft, theft of service, or unauthorized

acquisition or transfer of certain financial information, at the

request of the center, shall cooperate and assist the center in

collecting any statistical data or intelligence on the nature and

extent of those activities in the possession of the law enforcement

agency or prosecutor.

(b) A law enforcement agency or prosecutor may disclose

confidential information under Subsection (a) to the center, and

any disclosure of confidential information under this section does

not waive or affect the confidentiality of the information for

purposes of state or federal law or waive the right to assert

exceptions to required disclosure of the information in the future.

(c) Information collected under this section is excepted

from the requirements of Section 552.021.

SUBCHAPTER C. FINANCIAL PROVISIONS

Sec. 426.101 [ 2312.101 ]. FUNDING. The department may

solicit and accept gifts, grants, and other donations to fund,

administer, and carry out the purposes of the center, except that

the department may not solicit or accept a gift, grant, or other

donation from a license holder as defined by Section 2310.151 ,

Occupations Code .

Sec. 426.102 [ 2312.102 ]. AWARD OF GRANTS FOR FRAUD

DETERRENCE . (a) Subject to the availability of appropriated

money, the department may award grants for the purposes of

Subsection (b) [ this chapter ] by entering into a contract with each

grant recipient.

(b) A grant recipient may use grant money to:

(1) reduce card fraud by removing skimmers;

(2) purchase or upgrade fraud deterrence equipment,

including unique locking systems, cameras, and lights;

(3) provide training opportunities regarding

skimmers; and

(4) conduct public outreach regarding card fraud.

Sec. 426.103. AWARD OF GRANTS FOR ORGANIZED RETAIL THEFT

INVESTIGATION AND PROSECUTION. (a) From any funds available for

this purpose, the center by rule shall establish and implement

procedures to award grants that provide funding to eligible law

enforcement agencies and prosecuting attorneys to investigate and

prosecute organized retail theft.

(b) To be eligible for a grant, a recipient must be:

(1) a law enforcement agency that has established or

intends to establish a program or policy designed to prevent or

investigate organized retail theft; or

(2) a prosecuting attorney who:

(A) regularly prosecutes organized retail theft;

or

(B) has established or intends to establish a

program or policy focusing on the prosecution of organized retail

theft.

(c) The rules adopted under this section must:

(1) prioritize the award of grants based on a

demonstrated need for resources to prevent, investigate, or

prosecute organized retail theft in the jurisdiction of the law

enforcement agency or prosecuting attorney;

(2) include accountability measures for grant

recipients and mechanisms for enforcing the condition of any grant;

and

(3) require grant recipients to provide the center

with information regarding outcomes resulting from the use of grant

money.

SUBCHAPTER D. ORGANIZED RETAIL THEFT PREVENTION ADVISORY COMMITTEE

Sec. 426.151. DEFINITIONS. In this subchapter:

(1) "Advisory committee" means the organized retail

theft prevention advisory committee established under this

subchapter.

(2) "Qualifying theft and fraud scheme" means conduct

that constitutes:

(A) card fraud;

(B) cargo theft;

(C) fraud involving gift cards and related to

organized retail theft;

(D) mail theft;

(E) theft of service; or

(F) unauthorized acquisition or transfer of

certain financial information.

Sec. 426.152. ESTABLISHMENT OF ADVISORY COMMITTEE. The

center shall establish the organized retail theft prevention

advisory committee to develop policies, procedures, and

intelligence to assist in the prevention and prosecution of

organized retail theft and qualifying theft and fraud schemes.

Sec. 426.153. MEMBERSHIP. (a) The advisory committee

consists of 15 members appointed by the chief as follows:

(1) one representative of the center;

(2) two representatives of local law enforcement

agencies located in different municipalities, each with a

population of 500,000 or more;

(3) two representatives of local law enforcement

agencies located in different municipalities, each with a

population of 200,000 or more but less than 500,000;

(4) one representative of a local law enforcement

agency located in a municipality with a population of less than

200,000;

(5) one prosecutor whose jurisdiction includes a

county with a population of 500,000 or more;

(6) one prosecutor whose jurisdiction includes a

county with a population of 200,000 or more but less than 500,000;

(7) one retail investigator;

(8) three retailer representatives who specialize in

organized retail theft;

(9) one representative from an online retailer;

(10) one expert in fraud involving gift cards; and

(11) one expert in the unauthorized acquisition or

transfer of certain financial information.

(b) The center shall ensure that the members of the advisory

committee reflect the diverse geographic regions of the state.

(c) The presiding officer of the advisory committee is the

center's representative.

Sec. 426.154. MEETINGS. The advisory committee shall meet

at least quarterly and at the call of the presiding officer or the

center. An advisory committee meeting may be conducted virtually

through the Internet.

Sec. 426.155. ANNUAL EVALUATION OF MEMBERSHIP

PARTICIPATION. The center shall annually evaluate the input and

participation of members appointed under Section 426.153 and remove

members and appoint new members as necessary to ensure that each

member of the advisory committee collaborates and contributes to

the advisory committee.

Sec. 426.156. GENERAL DUTIES. The advisory committee

shall:

(1) advise the center and law enforcement agencies on

methods and procedures to:

(A) detect, deter, and prevent criminal activity

related to organized retail theft and qualifying theft and fraud

schemes; and

(B) develop best practices for conducting

investigations and responding to criminal activity related to

organized retail theft and related qualifying theft and fraud

schemes;

(2) collect and organize statistical data and

intelligence on the nature and extent of organized retail theft and

qualifying theft and fraud schemes, including:

(A) the number of investigations concerning,

arrests and prosecutions for, and convictions of the offense of

organized retail theft and any offense that is a qualifying theft

and fraud scheme;

(B) demographic information on persons who are

convicted of offenses described by Paragraph (A) and the merchants

and related persons who are the victims of those offenses; and

(C) intelligence on the methods and means used by

persons who engage in organized retail theft and qualifying theft

and fraud schemes; and

(3) collaborate with the Texas Commission on Law

Enforcement to develop and conduct training for peace officers on

the identification and prevention of organized retail theft and

qualifying theft and fraud schemes.

Sec. 426.157. REPORT. Not later than December 1 of each

year, the advisory committee shall file with the center a report

that must include a detailed account of its activities.

Sec. 426.158. INFORMATION EXCEPTED FROM REQUIRED PUBLIC

DISCLOSURE. The information collected under Section 426.156 is

excepted from the requirements of Section 552.021.

Sec. 426.159. APPLICABILITY OF OTHER LAW. Chapter 2110

does not apply to the size, composition, or duration of the advisory

committee or to the appointment of the advisory committee's

presiding officer.

SECTION 2. This Act takes effect September 1, 2025.