Skimmer device, ‘kingpin’ bill clears first round

A bill that would criminalize the unauthorized use of skimmer devices was expanded and advanced from general file April 16.

LB559, introduced by Sen. Carolyn Bosn of Lincoln, would define a skimmer device as an electronic or other device used to capture, record, store or transmit data from a financial transaction device or to capture or record an account holder’s personal identification code.

The bill would outlaw the use of such devices without authorization at an ATM or point-of-sale terminal, including fuel pumps, for the purpose of obtaining anything of value or with the intent to defraud.

Bosn said 315,000 credit or debit cards were skimmed in Nebraska in 2023, a 96% increase over the number of cards reported compromised in 2022. Organized gangs often use the information skimmed from cards to commit other financial crimes, she said.

Violations would be punishable by different penalty classifications according to the total value of money, credit or property obtained through the unlawful use of a skimmer device. When determining the classification of an offense, the bill also would provide an enhancement for any subsequent conviction or for a prior conviction within the previous 10 years.

The bill also would create a “kingpin” statute by providing for enhanced penalties for individuals who act in a leadership position while committing a financial offense that is part of a continuing series of financial transaction offenses, undertaken with two or more individuals.

Finally, LB559 would allow for asset forfeiture of money and property obtained through such financial transaction crimes.

Bosn said the leaders of skimming rings and organized retail theft operations often prey upon vulnerable populations to commit their crimes, such as homeless individuals and those with substance use problems.

Having a kingpin statute would give law enforcement the tools needed to combat this activity, she said, which also is often linked to drug and human trafficking.

A Judiciary Committee amendment, adopted 38-1, would add the provisions of LB464, also sponsored by Bosn. Those provisions would create the offense of organized retail crime, provide penalties and create the Financial Fraud Victims’ Reimbursement Fund, to be administered by the state attorney general’s office.

The amendment would define organized retail crime as theft of retail merchandise with the intent of reselling or otherwise reentering the retail merchandise in commerce or transferring the stolen retail merchandise to another retailer or person in exchange for anything of value.

Bosn said organized retail crimes have risen in recent years, in part because of the increased ability to resell stolen merchandise online.

“Unlike individual shoplifting, organized retail crime involves coordinated groups of individuals — often part of a larger criminal enterprise — and is characterized by significant financial losses and often involvement in other illegal activities,” she said.

Sen. Jane Raybould of Lincoln supported the bill and the amendment. Retailers have had to increase security precautions to guard against skimming devices on fuel pumps in recent years, she said, and crime victims face identity theft and significant financial hardships.

“Skimmer fraud is not a victimless crime,” Raybould said.

Lincoln Sen. George Dungan expressed concern regarding a tendency by lawmakers to “hyper-criminalize” activity through creating new offenses and enhancing existing penalties, while not addressing root causes.

“In the big picture, my concern is that we continue to do those things without actually analyzing the larger issues — without making sure that we are funding things like mental health care, substance abuse disorder treatment and affordable housing.”

After adopting the committee amendment, lawmakers voted 38-0 to advance LB559 to select file.