Senate File 317

                                       SENATE FILE       
                                       BY  COMMITTEE ON JUDICIARY

                                       (SUCCESSOR TO SSB 1050)


    Passed Senate, Date               Passed House,  Date             
    Vote:  Ayes        Nays           Vote:  Ayes        Nays         
                 Approved                            

                                      A BILL FOR

  1 An Act relating to fraudulent use of a credit card, scanning
  2    device, or reencoder, and providing a penalty.
  3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
  4 TLSB 2031SV 80
  5 jm/cf/24

PAG LIN

  1  1    Section 1.  Section 715A.6, subsection 2, Code 2003, is
  1  2 amended to read as follows:
  1  3    2.  An offense under this section is a class "D" "C" felony
  1  4 if the value of the property or services secured or sought to
  1  5 be secured by means of the credit card is greater than one ten
  1  6 thousand dollars.  If the value of the property or services
  1  7 secured or sought to be secured by means of the credit card is
  1  8 greater than one thousand dollars but not more than ten
  1  9 thousand dollars, an offense under this section is a class "D"
  1 10 felony, otherwise the offense is an aggravated misdemeanor.
  1 11    Sec. 2.  Section 715A.6, Code 2003, is amended by adding
  1 12 the following new subsection:
  1 13    NEW SUBSECTION.  3.  For purposes of this section, the
  1 14 value of the property or services is the highest value of the
  1 15 property or services determined by any reasonable standard at
  1 16 the time the violation occurred.  Any reasonable standard
  1 17 includes but is not limited to market value within the
  1 18 community, actual value, or replacement value.  If property or
  1 19 services are secured by two or more acts from the same person
  1 20 or location, or from different persons by two or more acts
  1 21 which occur in approximately the same location or time period
  1 22 so that the acts are attributable to a single scheme, plan, or
  1 23 conspiracy, the acts may be considered as a single act and the
  1 24 value may be the total value of all property or services
  1 25 involved.
  1 26    Sec. 3.  NEW SECTION.  715A.10  ILLEGAL USE OF SCANNING
  1 27 DEVICE OR REENCODER.
  1 28    1.  A person commits a class "D" felony if the person does
  1 29 any of the following:
  1 30    a.  Uses a scanning device to access, read, obtain,
  1 31 memorize, or store, temporarily or permanently, information
  1 32 encoded on the magnetic strip or stripe of a payment card
  1 33 without the permission of the authorized user of the payment
  1 34 card, and with the intent to defraud the authorized user, the
  1 35 issuer of the authorized user's payment card, or a merchant.
  2  1    b.  Uses a reencoder to place information encoded on the
  2  2 magnetic strip or stripe of a payment card onto the magnetic
  2  3 strip or stripe of a different card without the permission of
  2  4 the authorized user of the card from which the information is
  2  5 being reencoded, and with the intent to defraud the authorized
  2  6 user, the issuer of the authorized user's payment card, or a
  2  7 merchant.
  2  8    2.  A second or subsequent violation of this section is a
  2  9 class "C" felony.
  2 10    3.  As used in this section:
  2 11    a.  "Merchant" means an owner or operator of a retail
  2 12 mercantile establishment or an agent, employee, lessee,
  2 13 consignee, officer, director, franchisee, or independent
  2 14 contractor of such owner or operator.  A "merchant" also means
  2 15 a person who receives from an authorized user of a payment
  2 16 card, or someone the person believes to be an authorized user,
  2 17 a payment card or information from a payment card, or what the
  2 18 person believes to be a payment card or information from a
  2 19 payment card, as the instrument for obtaining, purchasing, or
  2 20 receiving goods, services, money, or anything else of value
  2 21 from the person.
  2 22    b.  "Payment card" means a credit card, charge card, debit
  2 23 card, or any other card that is issued to an authorized card
  2 24 user and that allows the user to obtain, purchase, or receive
  2 25 goods, services, money, or anything else of value from a
  2 26 merchant.
  2 27    c.  "Reencoder" means an electronic device that places
  2 28 encoded information from the magnetic strip or stripe of a
  2 29 payment card onto the magnetic strip or stripe of a different
  2 30 payment card.
  2 31    d.  "Scanning device" means a scanner, reader, or any other
  2 32 electronic device that is used to access, read, scan, obtain,
  2 33 memorize, or store, temporarily or permanently, information
  2 34 encoded on the magnetic strip or stripe of a payment card.
  2 35                           EXPLANATION
  3  1    This bill relates to the criminal offense of fraudulent use
  3  2 of a credit card, scanning device, or reencoder.
  3  3    The bill provides that the value of property or services
  3  4 fraudulently obtained or attempted to be obtained by use of a
  3  5 credit card is to be determined by any reasonable standard,
  3  6 including the market value within the community, actual value,
  3  7 or replacement value.  The bill also provides that if the
  3  8 property or services are fraudulently obtained by two or more
  3  9 acts from the same person or location, or from different
  3 10 persons by two or more acts which occur in approximately the
  3 11 same location or time period so that the acts are attributable
  3 12 to a single scheme, plan, or conspiracy, the acts may be
  3 13 considered as a single act and the value may be the total
  3 14 value of all property or services involved.  The bill provides
  3 15 that if the value of the property or services obtained or
  3 16 attempted to be obtained is greater than $10,000 the person
  3 17 commits a class "C" felony.  If the value of the property or
  3 18 services is greater than $1,000 but not more than $10,000 then
  3 19 the offense is a class "D" felony; otherwise the offense is an
  3 20 aggravated misdemeanor.
  3 21    The bill provides that a person who illegally uses a
  3 22 scanning device or reencoder commits a class "D" felony for a
  3 23 first offense and a class "C" felony for a second or
  3 24 subsequent offense.  A scanning device is defined under the
  3 25 bill to mean a scanner, reader, or other electronic device
  3 26 that is used to access or read information encoded on a
  3 27 magnetic strip.  A reencoder means an electronic device that
  3 28 places encoded information from a magnetic strip of a payment
  3 29 card onto the magnetic strip of a different payment card.
  3 30    An aggravated misdemeanor is punishable by confinement for
  3 31 no more than two years and a fine of at least $500 but not
  3 32 more than $5,000.  A class "D" felony is punishable by
  3 33 confinement for no more than five years and a fine of at least
  3 34 $750 but not more than $7,500.  A class "C" felony is
  3 35 punishable by confinement for no more than 10 years and a fine
  4  1 of at least $1,000 but not more than $10,000.
  4  2 LSB 2031SV 80
  4  3 jm/cf/24