S.B. 235 78(R)    BILL ANALYSIS


S.B. 235
By: Fraser
Business & Industry
Committee Report (Unamended)



BACKGROUND AND PURPOSE 

Currently, there is no Texas law that addresses protection of credit card
numbers through the regulation of credit card receipts. Stealing a credit
or debit card number is the easiest way to commit identity fraud, an issue
that affects more than 600,000 people annually and accounted for 42
percent of all Federal Trade Commission consumer fraud complaints in 2001.
S.B. 235 requires that a receipt or other document issued from a credit or
debit card transaction include not more than the last four digits of the
account number. S.B. 235 also prohibits expiration dates from being
printed on a receipt or other document issued from a credit card or debit
card transaction and provides for a civil penalty not to exceed $500 a
month for violating these requirements. S.B. 235 requires a purveyor of
cash registers and other similar machines to notify its customers about
the above-mentioned requirements. These restrictions are aimed at
thwarting identity theft. 


RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency, or
institution. 

ANALYSIS

SECTION 1. Amends Chapter 35D, Business & Commerce Code, by adding Section
35.58, as 
follows:

Sec. 35.58. BUSINESS RECEIPT CONTAINING CREDIT CARD OR DEBIT CARD
INFORMATION. (a) Provides that this section does not apply to a
transaction where the 
sole means of recording a credit or debit card account number on a receipt
or document 
evidencing the transaction is by handwriting or by an imprint or copy of
the credit or debit card. 

(b) Prohibits a person accepting a credit or debit card for the
transaction of business 
from printing more than the last four digits of the credit or debit
account number or the 
month and year of the card's expiration date on any document that
evidences the 
transaction and that is provided to a cardholder.

(c) Requires a person who provides, leases, or sells cash registers, or
other machines 
used to print receipts or other documents that evidence credit or debit
card 
transactions, to provide a notice of the requirements of this section to
the customer. 

(d) Prohibits a court from certifying an action brought under this section
as a class 
action.

(e) Provides that a violation of Subsection (b) carries a liability for a
state civil penalty 
not to exceed $500 for each calendar month during which the violation
occurs. 
Prohibits the penalty from being imposed for more than one violation in a
month. 
Authorizes the attorney general or prosecuting attorney in the county in
which the 
violation occurs to bring suit to recover the civil penalty.


(f) Authorizes the attorney general to bring an action in the name of the
state to restrain 
 or enjoin a person from violating Subsection (b)

SECTION 2. (a) Effective date: September 1, 2003.

(b) Provides that the application of this Act to any cash register or
machine placed in operation 
after August 31, 2003, will apply only to receipts or documents printed
after August 31, 2004. 

(c) Provides that with respect to a cash register or machine placed in
operation before 
September 1, 2003, this Act applies only to receipts or documents printed
after December 31, 
2005.



EFFECTIVE DATE

September 1, 2003.