H.B. No. 1839
AN ACT
relating to property in the custody of a pawnbroker; providing
criminal penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter D, Chapter 371, Finance Code, is
amended by adding Section 371.1821 to read as follows:
Sec. 371.1821. LAW ENFORCEMENT HOLD PROCEDURE; PLEDGE OR
SALE OF MISAPPROPRIATED PROPERTY. (a) In this section:
(1) "Chief law enforcement officer" means:
(A) the sheriff of the county in which the
pawnshop is located or an officer of the sheriff's department
designated by the sheriff, if the pawnshop is not located in a
municipality that maintains a police department; or
(B) the police chief of the municipality in which
the pawnshop is located or a police officer designated by the police
chief, if the pawnshop is located in a municipality that maintains a
police department.
(2) "Misappropriated" means stolen, embezzled,
converted, or otherwise wrongfully appropriated, or pledged
against the will of the owner of the goods or a person holding a
perfected security interest in the goods.
(b) If a chief law enforcement officer has reasonable
suspicion to believe that goods in the possession of a pawnbroker
are misappropriated, the officer may place a hold order on the
goods.
(c) Goods subject to a hold order must be physically
retained by the pawnbroker in a secure area and may not be released,
sold, redeemed, or disposed of unless:
(1) the chief law enforcement officer delivers a
written release to the pawnbroker;
(2) the hold order and any extension of the hold order
expire; or
(3) a court order, including a search warrant,
requires the release, sale, or disposal of the property.
(d) A hold order is effective only if it contains:
(1) the name of the pawnbroker;
(2) the name and mailing address of the pawnshop where
the goods are located;
(3) the name, title, badge number, and phone number of
the chief law enforcement officer placing the hold order;
(4) the case number of the criminal proceeding or
investigation involving the goods to be held;
(5) a complete description of the goods to be held,
including any available model number and serial number, and the
related pawn or purchase ticket number;
(6) the expiration date of the hold order; and
(7) the name of the law enforcement agency that
prepared the investigative report and the associated number of the
report.
(e) The hold order and any extension of the hold order must
be signed and dated by the chief law enforcement officer and the
pawnbroker or the pawnbroker's designee, as evidence of the hold
order's issuance by the chief law enforcement officer, the
pawnbroker's receipt of the hold order, and the beginning of the
holding period. The chief law enforcement officer shall provide at
no cost to the pawnbroker an executed copy of the hold order for the
pawnbroker's records.
(f) The initial holding period of the hold order may not
exceed 60 days. A hold order may be extended for up to three
successive 60-day periods on written notification to the pawnbroker
before the expiration of the immediately preceding holding period
or extension. A hold order may be released before the expiration of
the holding period or extension by written release from the chief
law enforcement officer. A hold order is considered expired on the
expiration date stated on the hold order if the holding period is
not extended under this subsection.
(g) Notwithstanding Subsection (e) or (f), the chief law
enforcement officer may place a verbal hold order on property, or
may verbally extend a hold order, for up to seven days while a
written hold order or extension is being prepared. A verbal hold
order must include the information required by Subsection (d).
(h) Goods subject to a hold order may be released to the
custody of the chief law enforcement officer for use in a criminal
investigation if the officer:
(1) has probable cause to believe that the goods
subject to a hold order are misappropriated; and
(2) furnishes a written receipt for the goods.
(i) The release of the goods to the custody of the chief law
enforcement officer is not considered a waiver or release of the
pawnbroker's rights or interest in the goods. Goods in the custody
of the chief law enforcement officer are subject to Chapter 47, Code
of Criminal Procedure.
(j) A person commits an offense if the person pledges with
or sells to a pawnbroker misappropriated property. An offense
under this subsection is a Class B misdemeanor.
SECTION 2. Chapter 371, Finance Code, is amended by adding
Subchapter H to read as follows:
SUBCHAPTER H. PROVIDING DATA TO LAW ENFORCEMENT AGENCIES BY
ELECTRONIC MEANS
Sec. 371.351. DEFINITIONS. In this subchapter:
(1) "Chief law enforcement officer" has the meaning
assigned by Section 371.1821.
(2) "Law enforcement agency" means the department of
the chief law enforcement officer.
(3) "Provider" means a commercial enterprise
primarily engaged in the business of establishing and maintaining
one or more Internet repositories.
(4) "Reportable data" means the following information
from a transaction in which a pawnshop customer pledges or sells
personal property:
(A) the name and address of the pawnshop;
(B) the date of the transaction; and
(C) an identification and complete description
of the goods pledged or sold, including any available model numbers
and serial numbers, and other identifying characteristics.
(5) "Repository" means an electronic storage of
transaction data.
(6) "Transaction data" means information from a
transaction in which a pawnshop customer pledges or sells personal
property, including:
(A) the name and address of the pawnshop;
(B) the date of the transaction;
(C) an identification and complete description
of the goods pledged or sold, including any available model numbers
and serial numbers, and other identifying characteristics;
(D) the customer's name, address, and physical
description; and
(E) a driver's license number, military
identification number, identification certificate number, or other
official number that identifies the customer.
Sec. 371.352. ELECTRONIC REPORTING TO LAW ENFORCEMENT
AGENCY OR PROVIDER. (a) A pawnbroker who generates computerized
pawn and purchase tickets shall, as required by the chief law
enforcement officer, transmit all:
(1) reportable data to the law enforcement agency
electronically in a format used by the pawnbroker's computer
software; or
(2) transaction data electronically in the format used
by the pawnbroker's computer software directly to a provider.
(b) A pawnbroker may transmit transaction data to the chief
law enforcement officer. A pawnbroker and the chief law
enforcement officer may agree to another means of transferring
transaction data to a law enforcement agency.
(c) A pawnbroker who reports information under this
subchapter shall transmit data pertaining to a transaction not
later than the seventh day after the date of the transaction, or
within a shorter period as agreed to by the chief law enforcement
officer and the pawnbroker.
(d) If the chief law enforcement officer requires a
pawnbroker to submit reportable data to the law enforcement agency,
the law enforcement agency shall maintain a secure database using a
minimum of 128-bit encryption for all electronic transmissions
under this subchapter that occur through the Internet. The law
enforcement agency shall implement appropriate security measures
to ensure that its database of reportable data may be accessed only
by the chief law enforcement officer.
(e) A law enforcement agency may not charge a fee to a
pawnbroker or customer of a pawnbroker for the preparation,
compilation, conversion, or transmission of data under this
section.
Sec. 371.353. PROVIDER REPOSITORY. (a) A provider may
establish a repository for the purpose of providing law enforcement
agencies with access to transaction data to facilitate the
investigation of alleged property crimes.
(b) A provider shall collect and maintain the transaction
data and shall update the repository at least daily.
(c) A provider shall implement appropriate security
measures and data recovery measures necessary to ensure the
integrity of the data. A provider shall ensure that the repository
can be accessed only by a chief law enforcement officer in
accordance with this subchapter.
Sec. 371.354. CHARGES FOR USE OF REPOSITORY. (a) A
provider may charge a law enforcement agency a fee to access the
repository. The fee must be reasonable in relation to the
provider's costs in establishing and maintaining the repository.
(b) A provider may not charge a pawnbroker or customer of a
pawnbroker a fee for the compilation or transmission of reportable
data or for the creation, maintenance, or use of any repository.
Sec. 371.355. REPOSITORY REQUIREMENTS. A repository must:
(1) enable reporting pawnbrokers to transmit data for
each pawn and purchase transaction over the Internet in the format
used by the pawnbroker's computer software;
(2) enable authorized chief law enforcement officers
who provide a secure identification or access code to access the
reportable data contained in the repository over the Internet;
(3) prevent unauthorized persons from accessing the
data contained in the repository;
(4) require authorized chief law enforcement officers
seeking access to the identity of the customer in a pawn or purchase
transaction to:
(A) represent that the information is sought in
connection with the investigation of a crime involving the goods
delivered by the customer in that transaction; and
(B) present:
(i) a valid case number of a criminal
proceeding or investigation for which the customer's identity is
needed; or
(ii) if a case number is not available, the
name and badge number of the chief law enforcement officer seeking
access to the customer's identity;
(5) record the following information for each search
of the repository:
(A) the identity of the law enforcement personnel
searching the repository;
(B) the pawn or purchase transaction involved in
the search; and
(C) the identity of any customer whose
information was accessed through the search; and
(6) use a minimum of 128-bit encryption for all
transmissions to and from the repository.
Sec. 371.356. CONFIDENTIALITY. (a) The data in the
repository is confidential and may be released or disclosed only to
a law enforcement agency for the investigation of a crime or to the
commissioner for administrative purposes.
(b) A person who releases or discloses data in violation of
this section commits an offense. An offense under this section is a
Class A misdemeanor.
Sec. 371.357. FRAUDULENT ACCESS OF REPOSITORY. A person
who gains access to the information in the repository through fraud
or false pretenses commits an offense. An offense under this
section is a Class A misdemeanor.
Sec. 371.358. COMMISSIONER OVERSIGHT. (a) The
commissioner may require appropriate documentation demonstrating
that a provider or a law enforcement agency that collects
reportable data meets the requirements of this subchapter.
(b) On or before January 31 of each year, a provider or law
enforcement agency that collects reportable data electronically
under this subchapter shall report to the commissioner the total
number of transactions reported by each reporting pawnbroker in the
preceding calendar year. The provider or law enforcement agency
shall provide the report at no cost to the commissioner.
Sec. 371.359. COMPUTER-RELATED MALFUNCTIONS AND ERRORS.
(a) A pawnbroker who electronically reports information under this
subchapter may not be held responsible for a delay in submitting
data that results from a computer-related malfunction or error
caused by the pawnbroker's equipment or software, if:
(1) the pawnbroker makes a bona fide effort to repair
the malfunction or correct the error; and
(2) the pawnbroker and the chief law enforcement
officer arrange a mutually acceptable alternative method by which
the pawnbroker provides the data to the law enforcement agency.
(b) A pawnbroker who electronically reports information
under this subchapter may not be held responsible for a delay in
submitting data that results from a computer-related malfunction or
error that is the responsibility of a provider or a law enforcement
agency. A pawnbroker and a chief law enforcement officer shall
arrange a mutually acceptable alternative method by which the
pawnbroker provides the data to the law enforcement agency until
the malfunction or error is corrected.
(c) The Finance Commission of Texas may adopt rules to
establish procedures to address computer-related malfunctions and
errors under this subchapter.
Sec. 371.360. PAPER COPIES. (a) A pawnbroker who
electronically reports information under this subchapter shall
make available for on-site inspection, to any appropriate law
enforcement officer on request, paper copies of pawn or purchase
transaction documents.
(b) After the 180th day after the date a pawnbroker
transmits data under this subchapter, the pawnbroker is not
required to make available to any law enforcement personnel paper
copies of the pawnbroker's information related to the pawnbroker's
pawn or purchase transactions, except as provided by Subsection (c)
and for evidentiary purposes for which a law enforcement officer
makes a specific request related to a specific transaction.
(c) For a reasonable period of time following the repair of
a computer-related malfunction or error, a pawnbroker shall make
available for on-site inspection, to any appropriate law
enforcement officer on request, paper copies of pawn or purchase
transaction documents for transactions that occurred during the
period beginning when the malfunction or error occurs and ending
when the chief law enforcement officer is reasonably certain the
malfunction or error has been corrected.
(d) The Finance Commission of Texas may adopt rules to
implement this section.
SECTION 3. This Act takes effect January 1, 2004.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 1839 was passed by the House on May 1,
2003, by a non-record vote; and that the House concurred in Senate
amendments to H.B. No. 1839 on May 29, 2003, by a non-record vote.
______________________________
Chief Clerk of the House
I certify that H.B. No. 1839 was passed by the Senate, with
amendments, on May 27, 2003, by a viva-voce vote.
______________________________
Secretary of the Senate
APPROVED: __________________
Date
__________________
Governor