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House of Representatives
Session of 2017 - 2018 Regular Session


Posted: August 21, 2017 03:06 PM
From: Representative Kristin Hill
To: All House members
Subject: Prevention of Credit Card Fraud by Scanning and Skimming Devices
Credit card fraud is on the rise, and the damage from this crime is significant. Our laws have not kept up with the new technology used by the perpetrators of credit card fraud. Therefore, I will be introducing legislation that will update and upgrade Pennsylvania law to help prevent, eliminate and punish the use of fraudulent credit card devices.

My bill is modeled after recently enacted legislation in other states, including Florida, to directly address the fraudulent methods employed by those that commit these crimes. It specifically criminalizes the use of a “scanning” or “skimming” device to obtain or store information encoded on the computer chip or magnetic strip of a credit or debit card; the use of a “re-encoder” to place information encoded on the computer or magnetic strip onto a different card without permission of the card’s user; and the possession or sale of a “skimming” device. A first offense constitutes a felony of the third degree, and a second or subsequent offense as a felony of the second degree.

Nasdaq reports that the U.S. is responsible for 47 percent of the world's card fraud despite only accounting for 24 percent of total worldwide card volume. And U.S. credit card fraud is on the rise. About 31.8 million U.S. consumers had their credit cards breached in 2014, more than three times the number affected in 2013. This fraud is not without consequences to its victims. Nearly 90 percent of card breach victims in 2014 received replacement credit cards, costing issuers as much as $12.75 per card. Retailers incur $580.5 million in debit card fraud losses and spend $6.47 billion annually on credit and debit card fraud prevention annually.

While consumers are generally shielded from liability when credit card fraud occurs, the industry costs are passed onto consumers and the individual who is the victim of the fraud is burdened with replacing his or her card and filing reports with the credit card company, the bank, credit reporting agencies, and others. While in 2015 credit cards in the United States began to incorporate chip technology, credit card fraud losses remain huge. Equally significant, our laws were written before the chip technology came into being.

Please join me in supporting this legislation to prevent credit card fraud and hold accountable those persons who commit such crime. If you have any questions please contact Lauren Evans at lmevans@pahousegop.com.

Introduced as HB1918