By Sarah Naron
TEXAS – As the clock struck midnight Monday, Jan. 1 and fireworks brightened the sky above the Lone Star State, just over two dozen new laws were making their way into the books for 2018.
Shoppers across the state who use credit or debit cards may want to be prepared to show photo identification when making purchases. Under the new Senate Bill 1381 – authored by Sen. Bryan Hughes, coauthored by Sen. Robert Nichols and sponsored by Rep. Oscar Longoria – retailers will be given the option of rejecting any credit or debit card transaction during which the customer is unable to or refuses to present ID.
As an analysis of the bill pointed out, “The proliferation of highly publicized data security breaches at some of the nation’s largest retailers – as well as numerous breaches at less visible entities – over the past several years is an ongoing concern not only for consumers, but also community financial institutions.
When credit and debit card data is compromised in such breaches, the information can be used in the creation of fraudulent cards which criminals may then use to make purchases in person, on the Internet, and via telephone.
In addition, cards which have been lost or stolen are often used in the wrong hands before the rightful owner is even aware there is an issue.
As the analysis further divulged, the bank responsible for issuing the card affected “ends up taking the loss for the fraud as well as absorbing the costs to reissue the compromised card.” As a result of “certain shifts in liability for fraudulent purchases” and recently implemented chip technology on cards, retailers also run the risk of being responsible for certain losses occurring as a result of fraudulent sales.
“This proposal addresses only a small portion of card fraud – primarily when a card has been lost or stolen – but will result in fewer losses for banks, merchants, and more importantly, consumers,” reads the bill’s Statement of Intent.
Prior to the implementation of S.B. 1381, agreements existed between retailers and major credit card companies such as MasterCard® and Visa® that while photo identification may be requested at the point of sale, declining the transaction due to no ID being shown was prohibited.
In the event that a retailer chooses not to begin requesting ID for transactions involving debit or credit cards, no penalties will be assessed.
Also going into effect for the New Year is S.B. 5, which aims to ease the stringent requirements of the Texas voter ID law. Voters in the state who can prove the existence of a “reasonable impediment” to obtaining a photo ID will be permitted to provide alternate forms of identification such as paystubs or bank statements. Individuals found lying about their inability to get a photo ID will be charged with a state jail felony.
Sarah Naron may be reached via email at email@example.com.