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Senate Study Bill 3024 - IntroducedA Bill ForAn Act 1relating to the criminal offenses of the illegal use of
2a scanning device or encoding machine and criminal mischief
3in the third degree, and providing penalties.
4BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 715A.10, Code 2018, is amended to read
2as follows:
3715A.10 Illegal use of scanning device or reencoder encoding
4machine.
51. A person commits a class “D” felony if the person does
6any of the following:
7a. Uses Directly or indirectly uses a scanning device
8to access, read, obtain, memorize, or store, temporarily
9or permanently, information encoded on the magnetic strip
10or stripe of a payment card without the permission of the
11authorized user of the payment card, and with the intent to
12defraud the authorized user, the issuer of the authorized
13user’s payment card, or a merchant.
14b. Possesses a scanning device with the intent to obtain
15information encoded on a payment card without the permission
16of the authorized user of the payment card, the issuer of the
17authorized user’s payment card, or a merchant, or possesses a
18scanning device with knowledge that a person other than the
19authorized user, the issuer of the authorized user’s payment
20card, or a merchant intends to use the scanning device to
21obtain information encoded on a payment card without the
22permission of the authorized user, the issuer of the authorized
23user’s payment card, or a merchant.
24b. c. Uses a reencoder Directly or indirectly uses an
25encoding machine to place information encoded on the magnetic
26strip or stripe of a payment card onto the magnetic strip
27or stripe of a different payment card without the permission
28of the authorized user of the payment card from which the
29information is being reencoded was obtained, and with the
30intent to defraud the authorized user, the issuer of the
31authorized user’s payment card, or a merchant.
322. A second or subsequent violation of this section is a
33class “C” felony.
343. As used in this section:
35a. “Encoding machine” means an electronic device that is
-1-1used to encode information onto a payment card.
2a. b. “Merchant” means an owner or operator of a retail
3mercantile establishment or an agent, employee, lessee,
4consignee, officer, director, franchisee, or independent
5contractor of such owner or operator. A “merchant” also means
6 includes an establishing financial institution referred to
7in section 527.5, a person who receives from an authorized
8user of a payment card, or someone the person believes to
9be an authorized user, a payment card or information from a
10payment card, or what the person believes to be a payment card
11or information from a payment card, as the instrument for
12obtaining, purchasing, or receiving goods, services, money, or
13anything else of value from the person.
14b. c. “Payment card” means a credit card, charge card,
15debit card, access device as defined in section 527.2, or
16any other card that is issued to an authorized card user and
17that allows the user to obtain, purchase, or receive goods,
18services, money, or anything else of value from a merchant.
19c. “Reencoder” means an electronic device that places
20encoded information from the magnetic strip or stripe of a
21payment card onto the magnetic strip or stripe of a different
22payment card.
23d. “Scanning device” means a scanner, reader, wireless
24access device, radio frequency identification scanner, an
25electronic device that utilizes near field communications
26technology, or any other electronic device that is used to
27access, read, scan, obtain, memorize, or store, temporarily
28or permanently, information encoded on the magnetic strip or
29stripe of a payment card.
30 Sec. 2. Section 716.5, subsection 1, Code 2018, is amended
31by adding the following new paragraph:
32 NEW PARAGRAPH. f. The property has the ability to process a
33payment card as defined in section 715A.10.
34EXPLANATION
35The inclusion of this explanation does not constitute agreement with
-2-1the explanation’s substance by the members of the general assembly.
2This bill relates to the illegal use of a scanning device or
3encoding machine.
4ILLEGAL USE OF SCANNING DEVICE OR ENCODING MACHINE. The bill
5replaces the term “reencoder” with the term “encoding machine”.
6The bill defines “encoding machine” to mean an electronic
7device that is used to encode information to a payment card.
8The bill also expands the definition of “merchant” to
9include an establishing financial institution referred to in
10Code section 524.5.
11The bill modifies the definition of “payment card” to
12include an access device as defined in Code section 527.2.
13The bill also modifies the term “scanning device” to include
14a wireless access device, a radio frequency identification
15scanner, and an electronic device that utilizes near field
16communications technology.
17A person commits a class “D” felony under the bill if the
18person directly or indirectly uses a scanning device to access,
19read, obtain, memorize, or store, temporarily or permanently,
20information encoded on a payment card without the permission
21of the authorized user, the issuer of the authorized user’s
22payment card, or a merchant. In order to commit this offense
23currently, a person must use a scanning device to access,
24read, obtain, memorize, or store, temporarily or permanently,
25information encoded on the magnetic strip or stripe of a
26payment card without the permission of the authorized user of
27the payment card, and with the intent to defraud the authorized
28user, the issuer of the authorized user’s payment card, or a
29merchant.
30The bill creates a new criminal offense. Under the bill, a
31person shall not possess a scanning device with the intent to
32obtain information encoded on a payment card without permission
33of the authorized user, the issuer of the authorized user’s
34payment card, or a merchant, or possess a scanning device with
35knowledge that a person other than the authorized user, the
-3-1issuer of the authorized user’s payment card, or a merchant
2intends to use the scanning device to obtain information
3encoded on a payment card without permission from the
4authorized user, the issuer of the authorized user’s payment
5card, or a merchant. A person who violates this provision
6commits a class “D” felony.
7A person commits a class “D” felony under the bill if the
8person directly or indirectly uses an encoding machine to place
9information encoded on a payment card onto a different payment
10card without the permission of the authorized user, the issuer
11of the authorized user’s payment card, or a merchant. In order
12to commit this offense currently, a person must use a reencoder
13to place information encoded on the magnetic strip or stripe of
14a payment card onto the magnetic strip or stripe of a different
15card without the permission of the authorized user of the
16card from which the information is being reencoded, and with
17the intent to defraud the authorized user, the issuer of the
18authorized user’s payment card, or a merchant.
19A class “D” felony is punishable by confinement for no more
20than five years and a fine of at least $750 but not more than
21$7,500.
22CRIMINAL MISCHIEF IN THE THIRD DEGREE. If a person
23intentionally damages, defaces, alters, or destroys property
24that has the ability to process a payment card as defined in
25Code section 715A.10 in the bill, with no right to do such
26an act, that person commits criminal mischief in the third
27degree. Criminal mischief in the third degree is an aggravated
28misdemeanor.
29An aggravated misdemeanor is punishable by confinement for
30no more than two years and a fine of at least $625 but not more
31than $6,250.
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2a scanning device or encoding machine and criminal mischief
3in the third degree, and providing penalties.
4BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 715A.10, Code 2018, is amended to read
2as follows:
3715A.10 Illegal use of scanning device or reencoder encoding
4machine.
51. A person commits a class “D” felony if the person does
6any of the following:
7a. Uses Directly or indirectly uses a scanning device
8to access, read, obtain, memorize, or store, temporarily
9or permanently, information encoded on the magnetic strip
10or stripe of a payment card without the permission of the
11authorized user of the payment card, and with the intent to
12defraud the authorized user, the issuer of the authorized
13user’s payment card, or a merchant.
14b. Possesses a scanning device with the intent to obtain
15information encoded on a payment card without the permission
16of the authorized user of the payment card, the issuer of the
17authorized user’s payment card, or a merchant, or possesses a
18scanning device with knowledge that a person other than the
19authorized user, the issuer of the authorized user’s payment
20card, or a merchant intends to use the scanning device to
21obtain information encoded on a payment card without the
22permission of the authorized user, the issuer of the authorized
23user’s payment card, or a merchant.
24b. c. Uses a reencoder Directly or indirectly uses an
25encoding machine to place information encoded on the magnetic
26strip or stripe of a payment card onto the magnetic strip
27or stripe of a different payment card without the permission
28of the authorized user of the payment card from which the
29information is being reencoded was obtained, and with the
30intent to defraud the authorized user, the issuer of the
31authorized user’s payment card, or a merchant.
322. A second or subsequent violation of this section is a
33class “C” felony.
343. As used in this section:
35a. “Encoding machine” means an electronic device that is
-1-1used to encode information onto a payment card.
2a. b. “Merchant” means an owner or operator of a retail
3mercantile establishment or an agent, employee, lessee,
4consignee, officer, director, franchisee, or independent
5contractor of such owner or operator. A “merchant” also means
6 includes an establishing financial institution referred to
7in section 527.5, a person who receives from an authorized
8user of a payment card, or someone the person believes to
9be an authorized user, a payment card or information from a
10payment card, or what the person believes to be a payment card
11or information from a payment card, as the instrument for
12obtaining, purchasing, or receiving goods, services, money, or
13anything else of value from the person.
14b. c. “Payment card” means a credit card, charge card,
15debit card, access device as defined in section 527.2, or
16any other card that is issued to an authorized card user and
17that allows the user to obtain, purchase, or receive goods,
18services, money, or anything else of value from a merchant.
19c. “Reencoder” means an electronic device that places
20encoded information from the magnetic strip or stripe of a
21payment card onto the magnetic strip or stripe of a different
22payment card.
23d. “Scanning device” means a scanner, reader, wireless
24access device, radio frequency identification scanner, an
25electronic device that utilizes near field communications
26technology, or any other electronic device that is used to
27access, read, scan, obtain, memorize, or store, temporarily
28or permanently, information encoded on the magnetic strip or
29stripe of a payment card.
30 Sec. 2. Section 716.5, subsection 1, Code 2018, is amended
31by adding the following new paragraph:
32 NEW PARAGRAPH. f. The property has the ability to process a
33payment card as defined in section 715A.10.
34EXPLANATION
35The inclusion of this explanation does not constitute agreement with
-2-1the explanation’s substance by the members of the general assembly.
2This bill relates to the illegal use of a scanning device or
3encoding machine.
4ILLEGAL USE OF SCANNING DEVICE OR ENCODING MACHINE. The bill
5replaces the term “reencoder” with the term “encoding machine”.
6The bill defines “encoding machine” to mean an electronic
7device that is used to encode information to a payment card.
8The bill also expands the definition of “merchant” to
9include an establishing financial institution referred to in
10Code section 524.5.
11The bill modifies the definition of “payment card” to
12include an access device as defined in Code section 527.2.
13The bill also modifies the term “scanning device” to include
14a wireless access device, a radio frequency identification
15scanner, and an electronic device that utilizes near field
16communications technology.
17A person commits a class “D” felony under the bill if the
18person directly or indirectly uses a scanning device to access,
19read, obtain, memorize, or store, temporarily or permanently,
20information encoded on a payment card without the permission
21of the authorized user, the issuer of the authorized user’s
22payment card, or a merchant. In order to commit this offense
23currently, a person must use a scanning device to access,
24read, obtain, memorize, or store, temporarily or permanently,
25information encoded on the magnetic strip or stripe of a
26payment card without the permission of the authorized user of
27the payment card, and with the intent to defraud the authorized
28user, the issuer of the authorized user’s payment card, or a
29merchant.
30The bill creates a new criminal offense. Under the bill, a
31person shall not possess a scanning device with the intent to
32obtain information encoded on a payment card without permission
33of the authorized user, the issuer of the authorized user’s
34payment card, or a merchant, or possess a scanning device with
35knowledge that a person other than the authorized user, the
-3-1issuer of the authorized user’s payment card, or a merchant
2intends to use the scanning device to obtain information
3encoded on a payment card without permission from the
4authorized user, the issuer of the authorized user’s payment
5card, or a merchant. A person who violates this provision
6commits a class “D” felony.
7A person commits a class “D” felony under the bill if the
8person directly or indirectly uses an encoding machine to place
9information encoded on a payment card onto a different payment
10card without the permission of the authorized user, the issuer
11of the authorized user’s payment card, or a merchant. In order
12to commit this offense currently, a person must use a reencoder
13to place information encoded on the magnetic strip or stripe of
14a payment card onto the magnetic strip or stripe of a different
15card without the permission of the authorized user of the
16card from which the information is being reencoded, and with
17the intent to defraud the authorized user, the issuer of the
18authorized user’s payment card, or a merchant.
19A class “D” felony is punishable by confinement for no more
20than five years and a fine of at least $750 but not more than
21$7,500.
22CRIMINAL MISCHIEF IN THE THIRD DEGREE. If a person
23intentionally damages, defaces, alters, or destroys property
24that has the ability to process a payment card as defined in
25Code section 715A.10 in the bill, with no right to do such
26an act, that person commits criminal mischief in the third
27degree. Criminal mischief in the third degree is an aggravated
28misdemeanor.
29An aggravated misdemeanor is punishable by confinement for
30no more than two years and a fine of at least $625 but not more
31than $6,250.
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