AGENDA ITEM SA
May 6,2014
Action
MEMORANDUM
May 2, 2014
TO:
FROM:
SUBJECT:
County Council
~
Josh Hamlin, Legislative
Attorneif'
~
Action:
Expedited Bill 18-14, Secondhand Personal Property - Automated
Purchasing Machines
Public Safety Committee recommendation: The Committee took no action on
Bill 18-14,
but recommended (3-0) that the executive branch draft a memorandum of understanding
(MOU) with ecoATM and submit the MOU to the Council for approval.
Expedited Bill 18-14, Secondhand Personal Property - Automated Purchasing Machines,
sponsored by Council President Rice and Councilmembers Branson, Floreen, Riemer, Council
Vice President Leventhal and Council members Navarro and EIrich, was introduced on March 18.
A public hearing was held on April 8 and a Public Safety Committee was held on April 30.
Bill 18-14 would amend the County's secondhand personal property law to prohibit the
use of automated purchasing machines (also known as "reverse vending machines") in the
County. The fiscal and economic impact statements were received on April 7, 2014, and indicate
no fiscal or economic impact (©S-8).
Background
An automated purchasing machine (APM) is a self-service kiosk that dispenses payment,
typically in cash, for cell phones or other electronic devices. There is currently only one operator
of APMs in the United States, ecoATM, and there are currently no APMs located
in
the County.
Transactions of the sort conducted with APMs are currently covered under the County's
secondhand personal property law, Chapter 44A of the Code, but the existing law does not
directly address the use of APMs. Baltimore City and Baltimore County have recently enacted
local laws specifically prohibiting the use of APMs
1
out of concern that APMs provide a
convenient opportunity for cell phone thieves to convert stolen goods to cash without human
interaction, thereby encouraging such thefts.
The Maryland General Assembly passed House Bill 918 (HB 918) during the 2014
session, and it is expected to be signed by the Governor (©9-26). Once signed into law, HB 918
will take effect on October 1, 2014, and will preempt the County from regulating APMs and
supersede existing County law regulating APMs, but will permit the County to prohibit the use
Baltimore City prohibited the use of APMs in September 2013, and Baltimore County enacted its prohibition on
March 4,2014.
1
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of APMs within the County, as is proposed in Bill 18-14.
2
The County's secondhand personal
property law will be superseded as pertains to APMs, so maintaining the status quo beyond
October 1, 2014 is not an option. The Council essentially must decide whether to expressly
prohibit APMs, or accept the State regulation of them.
Public Hearing
Three people spoke at the public hearing on April 8: Captain Laura Lanham of MCPD,
on behalf of the County Executive and Police Chief (©27); Rob Garagiola of Alexander and
Cleaver (©28); and Michael McCann, Director of Law Enforcement Relations for ecoATM
(©31-33).
Captain Lanham stated that the Executive believes that APMs "have no place in
Montgomery County at this time." She also said that there was concern about a "possible
increase of crimes to obtain personal property" should these machines proliferate in the County,
and said that in the Executive's view, there is not sufficient historical experience to support the
proposition that APMs serve as a deterrent to crime. Captain Lanham did express that, despite
the stated concerns, the Executive is "open to alternatives to an outright ban."
Mr. Garagiola said that he did not believe that APMs lead to more cell phone theft, but
instead believes that they can be useful tools for law enforcement to apprehend thieves. He
referred to the passage of HB 918, and provided a summary of the provisions of the bill. Mr.
Garagiola urged withdrawal of Bill 18-14, and suggested that the County pursue a Memorandum
of Understanding (MOU) with ecoATM governing any future location of ecoATM machines in
the County.
Mr. McCann, representing ecoATM and its parent company, Outerwall, opposed the bill,
recognizing that cell phone theft is a problem, but saying that ecoATM has a strong interest in its
prevention. He discussed the several security measures taken in purchases made through
ecoATM APMs, and indicated that the APMs had in fact helped solve crimes. He also said that
ecoATM is the only operator of cell phone and mp3 purchasing APMs, and that there are no such
APMs currently operating in Montgomery County.
Public Safety Committee Worksession
The Public Safety Committee considered Bill 18-14 on April 30. The executive branch
was represented by Assistant Chief Russ Hamill, MCPD, Captain Laura Lanham, MCPD,
Sergeant Sean Renauer, MCPD, and Bruce Meier, OMB. Also present was Michael McCann on
behalf of ecoATM. Assistant Chief Hamill stated a concern about APMs presenting an
opportunity to easily convert cell phones to cash, but indicated that there was not enough
evidence to determine the level of concern created by the machines. When asked, he indicated
that the use of an MOU specifying that ecoATM would not locate APMs in the County without
the County's consent would be acceptable to the Chief and the County Executive.
2
The new state law will also pennit the County to license APMs and APM operators. Because of the expressly
stated preemption, the extent of the County's authority to license is limited to collecting a license fee, and not to
placing additional conditions or restrictions on the issuance of a license.
2
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The Committee took no action on Bill 18-14, but recommended (3-0) that the executive
branch draft a suitable MOU with ecoATM, and submit the MOU to the Council for approval.
Issues for Discussion
1.
How will APMs be regulated after HB 918 takes effect?
As of October 1, 2014, a State regulatory regime for such transactions will be in place.
The provisions of HB 918 closely resemble the State law regulating secondhand precious metal
dealers. In general, the new State law regulatory framework would provide for the designation
by the local government of the "primary law enforcement unit" to receive APM records, the
licensing of operators of APMs, requirements for transactions conducted through APMs, and
penalties for noncompliance.
Preemption oflocal laws
As previously noted, HB 918 preempts the right of a county or municipality to regulate
APMs or APM operators, and supersedes any existing law of a county or municipality that
regulates APMs or APM operators. As a result of this provision, the County's secondhand
personal property law will no longer govern APM transactions once HB 918 takes effect.
However, State law will not limit the power of a county or municipality to prohibit the
installation of APMs within the county or municipality, or to license APMs and APM operators.
Licensing of "buyers"
The first part of the new State regulation of APMs requires a person buying or offering to
buy property by means of an APM (a "buyer") to obtain a license from the State Department of
Labor, Licensing, and Regulation. To obtain a license as a buyer, a person must submit an
application, signed under oath and accompanied by a nomefundable $300 application fee, to the
Secretary of Labor, Licensing, and Regulation (the '''Secretary''). As part of the application, the
applicant must authorize a municipal, county, or State police officer or agent, acting in the course
of a stolen property investigation or an investigation of a violation of State law regulating APMs,
to inspect and photograph all personal property and records at the applicant's business or storage
locations.
In addition to the application, a person seeking to be licensed as a buyer must submit to a
criminal history records check (CHRC) with the Criminal Justice Information System (CnS).
The Secretary may deny an application if the applicant has been convicted of a felony or certain
misdemeanors. Registration and a CHRC is also required for a person serving as a primary point
of contact, regularly conducting business for a licensed buyer, and maintaining a physical
location in Maryland for the conduct of business (a "resident agent"). The State law will also
provide a number of circumstances in which the Secretary may deny, suspend, or revoke a
license, or reprimand the licensee.
Transaction, reporting, and recordkeeping requirements
HB 918 prohibits certain purchases through APMs, and imposes several transaction,
reporting, and recordkeeping requirements on buyers. A buyer may not buy or offer to buy
3
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personal property from a minor, and may not buy an electronic device valued at $25 or more if
the APM cannot determine the serial number of the device. For each transaction, a buyer must
ensure that each APM owned or operated by the buyer:
• requires a seller to provide the seller's full name, home address, contact telephone
number, and date of birth
before
completing the transaction;
• requires a seller to submit a government-issued identification card or other identification
required by the Secretary;
.
• makes a record of the transaction that includes the required information obtained from the
seller, a photograph of the seller, an electronic copy or ·photocopy of the identifying
information, a description of the personal property, and the date, time, and location of the
transaction; and
• makes a record of the make and model of each electronic device purchased, including the
serial number of the device, if it can be determined at the time of purchase.
In addition to the above requirements, a buyer must use an individual to screen each purchase
transaction, and must keep a record of the screener assigned to each transaction. The individual
screening the transaction may do so remotely.
A buyer must submit the required records for a transaction to the primary law
enforcement unit designated by the local government within 48 hours of the transaction; the
records may be in paper or electronic format. If a serial number cannot be determined at the time
of the transaction, the buyer must submit a preliminary report within 48 hours, and must then
submit a final report, including the serial number, within 14 days ofthe transaction.
A buyer must keep all personal property purchased for at least 30 days after submission
of the required information to the primary law enforcement unit. On request of the primary law
enforcement unit, a buyer must provide any personal property purchased through an APM, and
must make all personal property purchased through an APM available for inspection by the
primary law enforcement unit at any time.
A buyer must remove all personal property purchased by an APM at least once every 10
days, and notify the primary law enforcement unit of the date and time of the removal at least 72
hours before removing the personal property. The primary law enforcement unit may inspect the
personal property being removed from an APM at the time of removal.
Penalties
A knowing and willful violation of the law is a misdemeanor subject to a fine of up to
$1,000 for a first offense, and up to $5,000 for a second or subsequent offense. Each violation is
a separate offense. The Secretary may also impose a penalty of up to $5,000 for certain acts
generally related to fraud committed by an applicant, licensee, or an agent, employee, manager
or partner of an applicant or licensee. The law also provides under certain circumstances that the
Secretary may seek an immediate restraining order from a circuit court to prohibit a licensee
from buying, selling, or disposing of personal property, or disposing of a record about personal
property.
2.
Do APMs increase or deter cell phone theft, and what about any environmental
benefit?
4
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Proponents of restrictions on the operation of APMs contend that the APMs contribute to,
or encourage, theft of cell phones and personal electronic devices by offering a quick, impersonal
means to convert stolen goods to cash without adequate safeguard to prevent the purchase of
stolen property. Defenders of APMs assert that APMs are actually an asset to law enforcement
in resolving crimes, and that they provide a valuable environmental benefit by recycling cell
phones and electronic devices that might otherwise "end up in a landfill. Unfortunately, there
appears to be a lack of hard data to unquestionably support any ofthese claims.
Increasing thefts
As noted earlier, Baltimore City and Baltimore County have recently passed laws
banning APMs. Both jurisdictions blamed the machines for an uptick
in
phone thefts, and
Baltimore County Police Chief Jim Johnson expressed confidence that the ban "will help reduce
the number of crimes involving cell phones by taking cash out of the equation.,,3 Also, in the
District of Columbia, Police Chief Lanier has been an outspoken critic of APMs, seeing them as
an easy way for thieves to turn stolen goods into cash. Chief Lanier appeared on NBC's Today
Show on May 23,2013 in an investigative feature in which two different APMs accepted an ID
from someone who was clearly not the seller, and completed the transaction.
4
While there are no
APMs currently located in the District of Columbia, there are several in surrounding suburban
jurisdictions, and Chief Lanier stated that her Department traced 200 stolen phones to one APM
over the summer of 2013.
5
In
contrast to Chief Lanier's claim, ecoATM asserts that just 1 in
every 1,500 phones that
it
acquires through APMs is lost or stolen. (©37)
In addition to the two Maryland jurisdictions, APMs have been banned in Riverside,
California, with similar justification. The Philadelphia City Council introduced a bill banning
APMs last fall and was approved by committee, but the bill appears likely to go to a task force
for further consideration before passage.
6
A few other local jurisdictions have considered
banning or restricting APM operation, but to date have not done so.
There does not appear to be a consensus among law enforcement agencies regarding the
impact of APMs on cell phone thefts, and it appears that any evidence of a relationship is
anecdotal. Law enforcement agencies in the jurisdictions that have banned APMs have
expressed a view that there is a connection, as has the South Burlington, Vermont Police
Department.
7
However, police departments in Burlington, Vermont,8 Houston, Texas,9 and
Everett, Washington
10
have indicated that they have not seen an increase in cell phone thefts
since the appearance of APMs in or near their respective jurisdictions.
SId
9
http://news.wypr.orglpostlbaltimore-county-bans-ecoatm
4
http://www.today.com/news/cash-phone-atms-may-fueJ-vio!ent-crime-top-cop-savs-I C9858818
5
http://www .npr.orglblogs/alltechconsideredl20 J
3/09/07/21
9809481 Ibaltimore-officia] s-want-to-unpl ug-phone s­
for-cash-kiosks
6
http://philadeJphia.cbslocal.com/20 131 I0/24/phiJa-counci Imembers-agree-to-explore-cell-phone-buyback-atmsl
7
http://www.sevendaysvt.com/vemlontlresponsible-recycling-or-digital-paW11shop-why-vemlont-cops-are-worried­
abolit-ecoatmslContent?oid=2266489
3
"
http://abclocal.go.comlktrk/storv?section=news/Jocal&id=9279987
10
http://www.komonews.comillewsllocal/Call-automated-kiosks-actually-help-catch-cellphone-thieves­
209978851.html
5
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Aid to law enforcement
In
response to criticism from law enforcement, APM operator ecoATM asserts that
it
actively works with law enforcement (©36-37), and that the machines actually assist in solving
crimes and returning stolen phones to their rightful owners. Media reports offer support for the
contention that arrests are sometimes made with the assistance of the operator when stolen
phones turn up in APMs, and at least one local law enforcement agency has benefited from
collaboration with ecoATM.ll However, whether this will have a deterrent effect resulting in a
reduction of thefts remains an open question.
Recycling cell phones and other electronic devices
Another proclaimed benefit of APMs is that they reduce the number of cell phones and
mobile devices entering the solid waste stream. In its most recent estimate (2009), the U.S. EPA
estimated that fewer than 12 million of 129 million mobile devices disposed of, less than 8% by
weight, were collected for recycling.
12
These devices contain precious metals and plastics that
can be recycled, but that are toxic and can pollute the air and contaminate soil and drinking water
if placed in a landfill. Given the abysmal rate of recycling and the toxicity of mobile device
component parts, it is beyond debate that the rate at which cell phones and other mobile devices
needs to be increased.
According to ecoATM, it has recycled over 2 million devices through its APMs in its
four-year existence, including a million in the 9 months between April 2013 and January 20l4Y
It
is unclear how many of the devices recycled through APMs would otherwise have entered the
solid waste stream, but it is likely that APM recycling does contribute to some reduction of the
number of devices going into landfills. However, ban on APMs would
not
foreclose all
opportunities to resell or recycle cell phones and other electronic devices. Best Buy offers in­
store and online trade-in of a wide variety of electronic devices, including phones, and recycling
of most electronics equipment and appliances.
14
There are also several online buyer/reseller
operations, such as uSell.com and gazelle. com, and a search on call2recycle.or indicated 33
drop-off locations for cell phone recycling within 10 miles of the 20850 zip code.
1
r
Other measures to prevent cell phone theft
In
addition to the new State law requirements governing APMs, another technological
development to combat cell phone theft is worth consideration. This April, several phone
manufacturers and wireless companies voluntarily agreed to include "kill switch" technology on
their devices beginning next year (©42). This technology would allow owners to remotely
remove data from their phones, and render the phones inoperable if stolen.
http://www.somdnews.com/articIe/20130215INEWSI130219415/1055INEWS&template=southemMaryland
12
http://www.epa.gov/osw/conserve/materialslecycling/manage.htm
13
http://www.prnewswire.comlnews-releaseslamericans-embracing-recycling-for-phones-and-electronics-ecoatm­
marks-two-million-devices-recycled-240271441.html
14
http://www.bestbuy.comlsite/payment-pricingltrade-in­
recyclinglpcmcat2044000500 1O.c?id=pcmcat2044000500 10
15
http://www.ca1l2recycle.orgllocator/
11
6
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While a voluntary agreement is not as powerful as a legal mandate, and while there
remains some criticism of the agreement,16 the implementation of kill switch technology should
have a favorable impact on phone thefts. There is also a bill pending
in
the U.S. Congress to
I7
require the technology on phones manufactured
in
or imported into the United StateS. The new
State law requires an APM to determine the serial number of a device purchased for over $25,
and an APM must power on the device to detennine the serial number. Therefore, a newer
phone rendered inoperable by kill switch could not be legally purchased through an APM.
3.
Is
an MOU with ecoATM a viable alternative to a ban?
At the public hearing, Mr. Garagiola suggested that, as an alternative to banning APMs,
the County should pursue an MOU with ecoATM, the only manufacturer/operator of APM
machines.
Mr.
Garagiola stated that ecoATM has no current plans to locate an APM in the
County, but that an MOU could provide that, should those plans change, the County's consent
would be required prior to the location of an ecoATM APM in the County. While it is
questionable whether such an MOU would be an enforceable contract, enforceability would
likely not be a problem. The County has the authority under State law to prohibit the installation
or operation APMs in the County, and could act to do so if ecoATM violated the terms of the
agreement.
If the Council does not ban APMs, an MOD may be helpful in maintaining a dialogue
with ecoATM concerning any future location of ecoATM APMs in the County. However, it
should be noted that while ecoATM is
currently
the only operator of APMs, it is certainly
possible that another business could enter the field, and any MOU with ecoATM would certainly
not be binding on another APM operator.
4.
Should APMs be licensed,
if
they are not banned?
In addition to allowing a county or municipality to prohibit the installation or operation of
APMs, the new State law will allow a county or municipality to license APMs and APM
operators. According to the Maryland General Assembly Department of Legislative Services,
this licensing authority is similar to that allowed to counties and municipalities for
junk
dealers
and scrap metal processors, and intended to be limited to collecting a fee for the issuance of a
license. If the Council chooses not to prohibit APMs outright, staff recommends requiring each
APM operator to obtain a County license for each APM located in the County. A County
licensing requirement would ensure that the County is aware of the number and location of the
APMs operating in the County, as well as who is operating them.
This packet contains:
Expedited Bill
18-14
Legislative Request Report
Fiscal and Economic Impact Statements
HB
918
Enrolled Bill
Testimony
Circle #
1
4
5
9
16
http://www.businessweek.com/articIes/20 14-04-16/next-debate-on-phones-kill-switch-who-turns-them-on
17
https://www.govtrack.us/congress/billsIl131hr4065/text
7
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Capt. Laura Lanham
Rob Garagiola
Mike McCann
ecoATMFAQs
ecoATM Law Enforcement F AQs
Smartphone Anti-Theft Voluntary Commitment
27
28
31
35
38
42
F:\LAW\BILLS\l418 Automated Purchasing Machines\Action Memo.Doc
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Expedited Bill No.
18-14
Concerning: Secondhand
Personal
Property - Automated Purchasing
Machines
Draft No. 3
Revised:
04/30/2014
Introduced:
March 18,2014
Expires:
September 18, 2015
_________________
Executive: _______________
Effective: _____________
Sunset Date: -.:..::N=on"'-'e"--_______
Ch. _ _, Laws of Mont. Co. _ __
En~t~:
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
By: Council President Rice and Councilmembers, Branson, Floreen, Riemer, Council Vice
President Leventhal and Councilmembers Navarro and EIrich
AN EXPEDITED ACT
to:
(1) prohibit the use of automated purchasing machines for the purchase ofpersonal
property;
(2) defme certain terms;
(3) provide certain exceptions; and
(4) generally amend the secondhand personal property law.
By amending
Montgomery County Code
Chapter
44A,
Secondhand Personal Property
Sections
44A-I, 44A-I6
and
44A-17
And adding
Section
44A-I8
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface brackets]]
* * *
Heading or defined term.
Added to existing law by original bill.
Deletedfrom existing law by original bill.
Added by amendment.
Deletedfrom existing law or the bill by amendment.
Existing law unqffected by bill.
The
County Council for Montgomery County, Maryland approves the following Act,·
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ExPEDITED BILL
No. 18-14
1
Sec
1.
Sections 44A-l, 44A-16 and 44A-17 are amended and Section
44A-18 is added as follows:
44A-l. Definitions.
When used in this chapter:
Automated Purchasing Machine
means
~
self-service device that:
2
3
4
5
6
7
ill
ill
is designed to dispense payment in exchange for personal
property; and
is also known as
~
reverse vending machine.
8
9
10
11
*
46.
*
*
Recyclable materials
means
recyclable solid waste
as defined in Section 48­
12
13
*
ill
*
*
~
44A-16. Automated Purchasing Machines.
General Prohibition.
Except as otherwise provided in this Section,
14
15
16
person must not purchase or offer to purchase any personal property
Qy
means of an automated purchasing machine.
(hl
Exception (or recyclable materials.
This Section does not prohibit the
17
18
19
20
use of an automated purchasing machine exclusively [[for collecting]]
to collect recyclable materials [[pursuant to]) under
operated or -approved recycling program.
44A-17. Regulations; restitution.
The Executive must adopt reasonable regulations under method (3) to
implement and administer this Chapter which may authorize the County to obtain
restitution on behalf of an injured party.,
[44A-17.] 44A-18. Penalties.
(a) Any person who violates this Chapter is subject to punishment for a
class A violation. Each day that a violation continues is a separate
offense.
-2-
f:\law\bills\1418 automated purchasing machines\bill3.doc
~
government-
21
22
23
24
25
26
27
28
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ExPEDITED BILL
No. 18-14
29
30
31
(b)
The Director of the Office of Consumer Protection may file an action
in any court with jurisdiction to enjoin any violation of this Chapter or
to enforce any order or decision issued under this Chapter.
32
33
34
35
[
44A-18.
Reserved.]
Sec. 2. Expedited Effective Date.
The Council declares that this legislation is necessary for the immediate
protection of the public interest. This Act takes effect on the date on which it
becomes law.
36
37
38
Approved:
39
Craig
L.
Rice, President, County Council
Date
40
Approved:
41
Isiah Leggett, County Executive
Date
42
43
This is a correct copy o/Council action.
Linda M. Lauer, Clerk of the Council
Date
-3-
f:\law\bil/s\1418 automated purchasing machines\bill 3.doc
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LEGISLATIVE REQUEST REPORT
Expedited Bill 18-14
Secondhand Personal Property Automated Purchasing Machines
DESCRIPTION:
Bill 18-14 would amend the County's secondhand personal property
law to prohibit the use of automated purchasing machines in the
County.
Automated purchasing machines (APMs), also known as "reverse
vending machines" and "cell phone kiosks," are self-service
machines which dispense cash payment for cell phones and other
electronic devices. APMs provide a convenient opportunity for
thieves to convert stolen goods to cash without any human
interaction.
To prohibit the use of automated purchasing machines in the County.
Department of Police
To be requested.
To be requested.
To be requested.
Baltimore City prohibited APMs in September 2013. Baltimore
County passed a law prohibiting APMs on March 5, 2014.
Josh Hamlin, 240-777-7892
To be researched.
PROBLEM:
GOALS AND
OBJECTIVES:
COORDINATION:
FISCAL IMPACT:
ECONOMIC
IMPACT:
EVALUATION:
EXPERIENCE
ELSEWHERE:
SOURCE OF
INFORMATION:
APPLICATION
WITHIN
MUNICIPALITIES:
PENALTIES:
Subject to Class "A" violation.
F:\LA w\BILLS\1418 Automated Purchasing Machines\LEG ISLATlVE REQUEST REPORT.Doc
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~\
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\L\
E
ROCKVILLE, MARYLAND
MEMORANDUM
April 7, 2014
TO:
Craig Rice,
pre~.
d
t
County Council
Jennifer A.
Hu
Joseph F. Beae
FROM:
SUBJECT:
rector,
om
'rector. Departm
0
gement and Budget
f
F
anoe
FEIS for Bill 18-14E, Secondhand
P
sonal Property - Automated Purchasing
Machines
Please find attached the fiscal and economic impact statements for the above­
referenced legislation.
JAH:fz
cc: Bonnie Kirkland, Assistant Chief Administrative Officer
Lisa Austin, Offices of the County Executive
Joy Nunni, Special Assistant to the County Executive
Patrick Lacefield, Director, Public lnfonnation Office
Joseph F. Beach, Director, Department of Finance
Michael Coveyou, Department of Finance
David Platt, Department ofFinance
Robert Hagedoom, Department ofFinance
Chief Thomas Manger. Montgomery County Police Department
Captain Laura Lanham, Montgomery County Police Department
Bruce Meier, Office of Management and Budget
Alex Espinosa. Office of Management and Budget
Felicia Zhang, Office of Management and Budget
Naeem Mia, Office of Management and Budget
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Fiscal Impact Statement
Council Bill 18-14E, Secondhand Personal Property - Automated Purchasing Machines
I. Legislative Summary
Bill 18-14 would amend the County's secondhand personal property law
to
prohibit the use of
automated purchasing machines (also known as "reverse vending machines") in the County.
2. An estimate of changes in County revenues and expenditures regardless of whether the
revenues or expenditures are assumed in the recommended or approved budget. Includes
source of information, assumptions, and methodologies used.
No change in revenues or expenditures is expected.
3. Revenue and expenditure estimates covering at least the next 6 fiscal years.
No change in revenues or expenditures is expected.
4.
An
actuarial analysis through the entire amortization period for each bill that would affect
retiree pension or group insurance costs.
Not applicable.
5. Later actions that may affect future revenue and expenditures if the bill authorizes future
spending.
None.
6. An estimate of the staff time needed to implement the bill.
None.
7. An explanation of how the addition of new staff responsibilities would affect other duties.
Not applicable.
8.
An
estimate of costs when an additional appropriation is needed.
No additional appropriation is needed.
9. A description of any variable that could affect revenue and cost estimates.
There are currently none ofthese machines in the County. If any were to
be
established,
they would be handled by existing resources.
10. Ranges of revenue.or expenditures that are uncertain or difficult to project.
Not applicable.
11.
If
a bill is likely to have no fiscal impact, why that is the case.
This bill does not have a fiscal impact at the present time because there are currently none
of these machines in the County.
12. Other fiscal impacts or comments.
None.
13. The following contributed to and concurred
with
this analysis:
Captain Laura Lanham, MCPD
Bruce Meier, Office of Management
&
Budget
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Economic Impact Statement
Bill 18-14E, Secondhand Personal Property - Automated Purchasing Machines
Background:
This legislation would prohibit the use of automated purchasing machines (APMs) for the
purchase of personal property; defme certain tenns; provide certain expenditures; and
generally amend the secondhand personal property law.
1.
The sources of information, assumptions, and methodologies used.
• Montgomery County Department of Police (MCP)
• Montgomery County Office of Conswner Protection (OCP)
• The number of automated purchasing machines (APMs) currently in the County
• The number and amount of transactions for each of the APMs
2.
A description of any variable that could affect the economic impact estimates.
According
to
information provided by MCP, there are currently no APMs
in
the
County. Also from infonnation provided by OCP, there are
no
businesses in the
County that manufacture or provide such machines. Because Bill lS-14E
(BilJ)
woulq prohibit the use of APMs in the County and there are no companies
in
the
County that supply such machines, there are no variables
that
could affect the
economic impact estimates.
3. The Bill's positive or negative effect,
if
any on employment, spending, saving,
investment, incomes, and property values in the County.
The Bill would have no direct economic impact on employment, spending, savings,
investment, incomes,
and
property values.
4.
If
a
BiD
is
likely to have no economic impact, why is that the case?
The Bill would have no direct economic impact because there are no APMs or
companies currently operating in the County.
5. The foUowing contributed to or concurred with this analysis: David Platt and Rob
Hagedoom, Finance; Captain Terrence Pierce, Montgomery County Department of
Police; Eric Friedman, Office of Conswner Protection.
Jo$J.;rrecrf
f0­
Department of Finance
Page
1
ofl
't-
2
-/
'f
Date
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HOUSE BILL 918
C2
(4lr3024)
ENROLLED BILL
- Economic Matters/Finance ­
Introduced by Qelegltte
C8slia:
Delegates Costa, Clippinger. and M. Washington
Read and Examined by Proofreaders:
Proofreader.
Proofreader.
Sealed with the Great Seal and presented to the Governor, for his approval this
day of
at
.
o'clock,
_ _ _M.
Speaker.
CHAPTER _ _
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AN
ACT concerning
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Business Regulation ­ Automated Purchasing Machines ­ Licensing of
Buyers and Required Records
FOR the purpose of requiring a person to have a license before doing business as a
buyer of personal property by means
of
an automated purchasing machine in
the State; establishing the application and renewal processes for a buyer's
license; requiring applicants for a buyer's license and a certain resident agent of
an applicant or a licensee to apply for a national and State criminal history
records check; authorizing the Secretary of Labor, Licensing, and Regulation to
issue a license under certain circumstances; authorizing the Secretary to deny,
suspend, or revoke a license, reprimand a licensee, or impose a certain penalty
under certain circumstances; requiring the Secretary
to
provide certain hearing
procedures before certain actions are taken; requiring the Secretary to inform
each primary law enforcement unit of each license that is issued, renewed,
changed to a new business location, denied, suspended, or revoked; requiring a
EXPLANATION:
CAPITALS I?Io"DICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
~tl'i;k@
8ltt
indicates matter stricken from the
bill by
amendment or deleted from the law
by
amendment.
Italics indicate opposite chamber/conference committee amendments.
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11111111 11111111111111111111111111111111
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HOUSE BILL 918
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buyer to ensure that each automated purchasing machine that the buyer owns
or operates in the State meets certain requirements; requiring an automated
purchasing machine to require a seller of certain personal property to provide
certain information before the completion of a certain transaction; requiring an
automated purchasing machine to verify certain information through certain
documentation submitted by a seller; establishing certain record keeping and
reporting requirements for a buyer; requiring a buyer to submit certain reports
to the primary law enforcement unit if certain information cannot be
determined at a certain time; providing that certain reporting requirements
may not be construed to require a buyer to incur a certain financial burden;
requiring a buyer to keep all personal property bought for a certain period of
time; requiring a buyer to provide certain personal property to the primary law
enforcement unit on request and at the cost of the buyer: requiring a buyer to
make certain personal property available for inspection by the primary law
enforcement unit at a certain time: requiring buyers to remove certain personal
property from an automated purchasing machine in a certain manner and to
provide a certain notice: authorizing the primary law enforcement unit to
inspect personal property being removed from an automated purchasing
machine at the time of removal: requiring a buyer to
ha¥e
use
an individual
screen
tpaft8a@tieft8
transaction under certain circumstances;
requiring a buyer
to keep certain records regarding screeners; requiring a buyer to contact the
primary law enforcement unit
if
personal property is determined to be stolen
and to return personal property to the primary law enforcement unit free of
charge; prohibiting
aB aNteIBaliea fJlti'@fta8iftg IBa8h.iB8 efJ8patep
a buyer from
buying or offering to buy personal property from a minor; prohibiting a buyer
from buying an electronic device under certain circumstances: establishing
certain penalties for a violation of this Act; exempting certain automated
purchasing machines from this Act; providing that this Act preempts the right
of any county or municipality to regulate automated purchasing machines or
operators of automated purchasing machines and supersedes any existing law of
a county or municipality that regulates automated purchasing machines or
operators of automated purchasing machines under certain circumstances:
authorizing a county or municipality to license automated purchasing machines
and operators of automated purchasing machines:
requiring the Secretary to
adopt certain regulations; providing for the designation of certain primary law
enforcement units for a certain purpose; defining certain terms; and generally
relating to automated purchasing machines.
BY adding to
Article - Business Regulation
Section 20-101 through 20-502 to be under the new title "Title 20. Automated
Purchasing Machines"
Annotated Code of Maryland
(2010 Replacement Volume and 2013 Supplement)
'SECTION
1.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That the Laws of Maryland read as follows:
®
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HOUSE BILL 918
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Article ­ Business Regulation
TITLE
20.
AUTOMATED PURCHASING MACHINES.
SUBTITLE
1.
DEFINITIONS; GENERAL PROVISIONS.
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20-101.
(A)
IN THIS TITLE THE FOLLOWING WORDS HAVE THE MEANINGS
INDICATED.
(B)
"AUTOMATED PURCHASING MACHINE" MEANS A SELF-SERVICE
DEVICE THAT:
IS DESIGNED TO DISPENSE MONEY IN EXCHANGE FOR
PERSONAL PROPERTY; AND
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(1)
(2)
IS ALSO KNOWN AS A REVERSE VENDING MACHINE.
(C)
"BUYER" MEANS A PERSON THAT BUYS OR OFFERS TO BUY
PERSONAL PROPERTY BY MEANS OF AN AUTOMATED PURCHASING MACHINE.
(D)
"ELECTRONIC
DEVICE" MEANS A DEVICE
CAPABLE
OF
FACILITATING COMMUNICATION THROUGH VOICE, DATA, TEXT, OR OTHER
VISUAL OR AUDITORY FORMAT.
(E)
"EMPLOYEE" MEANS AN INDIVIDUAL WHO IS EMPLOYED BY A BUYER
TO BUY OR SUPERVISE DIRECTLY THE BUYING OF PERSONAL PROPERTY.
(F)
"LICENSE" MEANS A LICENSE ISSUED BY THE SECRETARY TO DO
BUSINESS AS A BUYER.
(G)
(1)
MOVEABLE.
"PERSONAL PROPERTY" MEANS PRIVATE PROPERTY THAT IS
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(2)
"PERSONAL PROPERTY" INCLUDES:
PROPERTY THAT IS SERIALIZED OR NORMALLY HAS A
UNIQUE IDENTIFIER; AND
(II)
VALUE.
GIFT CARDS OR VOUCHERS THAT HAVE MONETARY
(I)
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HOUSE BILL 918
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(H) "PRIMARY LAW ENFORCEMENT UNIT" MEANS THE DEPARTMENT OF
STATE POLICE, A POLICE DEPARTMENT, OR SHERIFF, AS DESIGNATED BY A
RESOLUTION OF THE COUNTY OR MUNICIPAL GOVERNING BODY IN THE COUNTY
IN WHICH THE AUTOMATED PURCHASING MACHINE IS LOCATED.
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(I)
(1)
"RECYCLABLE MATERIALS" MEANS MATERIAL THAT:
(I)
IF NOT RECYCLED, WOULD BECOME SOLID WASTE FOR
DISPOSAL IN A REFUSE DISPOSAL SYSTEM; AND
(II) MAY BE COLLECTED, SEPARATED, OR PROCESSED AND
RETURNED TO THE MARKETPLACE IN THE FORM OF RAW MATERIALS OR
PRODUCTS.
"RECYCLABLE MATERIALS"
METALS, PLASTICS, AND CARDBOARD.
(2)
INCLUDES
PAPER,
GLASS,
(J)
WHO,;
"RESIDENT AGENT" MEANS A PERSON REGISTERED IN THE STATE
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SERVES AS A PRIMARY POINT OF CONTACT
:AND;
REGULARLY CONDUCTS BUSINESS FOR THE LICENSEE; AND
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MAINTAINS A PHYSICAL LOCATION IN MARYLAND WHERE THE
RESIDENT AGENT REGULARLY CONDUCTS BUSINESS AND AT WHICH THE
RESIDENT AGENT OR AN EMPLOYEE OF THE RESIDENT AGENT IS PHYSICALLY
PRESENT DURING NORMAL BUSINESS HOURS.
(K)
"SELLER" MEANS A PERSON WHO SELLS OR OFFERS TO SELL
PERSONAL PROPERTY TO AN AUTOMATED PURCHASING MACHINE.
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20-102.
THIS TITLE DOES NOT APPLY TO AN AUTOMATED PURCHASING
MACHINE THAT IS USED EXCLUSIVELY FOR COLLECTING RECYCLABLE
MATERIALS IN ACCORDANCE WITH A RECYCLING PROGRAM APPROVED BY THE
DEPARTMENT OF THE ENVIRONMENT.
EXCEPT
SUBSECTION, THIS TITLE:
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AS
PROVIDED
IN
PARAGRAPH
(2)
OF
THIS
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HOUSE BILL
918
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PREEMPTS THE RIGHT OF A COUNTY OR MUNICIPALITY
TO REGULATE AUTOMATED PURCHASING MACHINES AND OPERATORS OF
AUTOMATED PURCHASING MACHINES; AND
SUPERSEDES ANY EXISTING LAW OF A COUNTY OR
MUNICIPALITY THAT REGULATES AUTOMATED PURCHASING MACHINES AND
OPERATORS OF AUTOMATED PURCHASING MACHINES.
THIS TITLE DOES NOT LIMIT THE POWER OF A COUNTY OR
MUNICIPALITY TO:
LICENSE AUTOMATED PURCHASING MACHINES AND
OPERATORS
OF
AUTOMATED PURCHASING MACHINES; OR
ill
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(II)
PROHIBIT THE INSTALLATION OR OPERATION OF
AUTOMATED PURCHASING MACHINES WITHIN THE COUNTY OR MUNICIPALITY.
20-103.
THE SECRETARY SHALL ADOPT REGULATIONS TO CARRY OUT AND
ENFORCE THIS TITLE.
SUBTITLE 2. DESIGNATION OF PRIMARY LAW ENFORCEMENT UNIT.
20-201.
(A)
A
COUNTY OR MUNICIPAL GOVERNING BODY IN THE COUNTY IN
WHICH AN AUTOMATED PURCHASING MACHINE IS LOCATE!? SHALL DESIGNATE
BY RESOLUTION THE PRIMARY LAW ENFORCEMENT UNIT TO RECEIVE RECORDS
IN ACCORDANCE WITH
§
20-402(A)(1) OF THIS TITLE.
(B)
IF A MUNICIPAL GOVERNING BODY DESIGNATES A COUNTY POLICE
DEPARTMENT OR SHERIFF AS THE PRIMARY LAW ENFORCEMENT UNIT UNDER
THIS SECTION, THE COUNTY MAY DESIGNATE THE DEPARTMENT OF STATE
POLICE AS THE PRIMARY LAW ENFORCEMENT UNIT.
SUBTITLE 3. LICENSING.
20-301.
EXCEPT AS OTHERWISE PROVIDED IN THIS TITLE, A PERSON SHALL HAVE
A LICENSE BEFORE THE PERSON DOES BUSINESS AS A BUYER IN THE STATE.
20-302.
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HOUSE BILL 918
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(A)
(1)
AN
APPLICANT FOR A LICENSE SHALL:
(I)
SUBMIT TO THE SECRETARY AN APPLICATION ON THE
FORM THAT THE SECRETARY PROVIDES; AND
(II)
PAY TO THE SECRETARY AN APPLICATION FEE OF
$300.
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(2)
(B)
THE APPLICATION FEE IS NONREFUNDABLE.
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THE APPLICANT SHALL SIGN THE APPLICATION UNDER OATH.
(C)
IN ADDITION TO ANY OTHER INFORMATION THAT THE SECRETARY
REQUIRES, THE APPLICATION SHALL STATE:
(1)
APPLICANT;
THE NAME, DATE OF BIRTH, AND RESIDENCE ADDRESS OF THE
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(2)
(3)
THE BUSINESS ADDRESS OF THE APPLICANT;
A TELEPHONE NUMBER AT WHICH THE APPLICANT CAN BE
REACHED DURING NORMAL BUSINESS HOURS;
EACH ADDRESS WHERE THE APPLICANT HAS CONDUCTED ANY
BUSINESS DURING THE
3
YEARS BEFORE APPLICATION;
(4)
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(5)
THE DRIVER'S LICENSE NUMBER, IF ANY, OF THE APPLICANT;
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AND
THE NAME AND PERMANENT ADDRESS OF THE RESIDENT
AGENT WHO WILL REPRESENT THE APPLICANT IN THE STATE.
(D)
THE APPLICATION FORM SHALL CONTAIN IMMEDIATELY ABOVE THE
SIGNATURE LINE THE FOLLOWING:
"IF ISSUED A LICENSE, I AGREE TO ALLOW A MUNICIPAL, COUNTY, OR
STATE POLICE OFFICER OR AGENT ACTING IN THE COURSE OF A STOLEN
PROPERTY INVESTIGATION OR AN INVESTIGATION OF A VIOLATION OF THIS
TITLE TO INSPECT AND PHOTOGRAPH ALL PERSONAL PROPERTY AND RECORDS
AT MY BUSINESS OR STORAGE LOCATIONS.".
(6)
20-303.
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HOUSE BILL
918
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BEFORE AN INDIVIDUAL MAY BEGIN WORK AS A RESIDENT AGENT FOR A
BUYER:
(1)
THE BUYER SHALL SUBMIT TO THE SECRETARY ON THE FORM
THAT THE SECRETARY PROVIDES THE NAME OF THE INDIVIDUAL; AND
(2)
THE INDIVIDUAL SHALL APPLY FOR A NATIONAL AND STATE
CRIMINAL HISTORY RECORDS CHECK REQUIRED UNDER
§
20-304(B) OF THIS
SUBTITLE.
20-304.
(A)
IN THIS SECTION, "CENTRAL REPOSITORY" MEANS THE CRIMINAL
JUSTICE INFORMATION SYSTEM CENTRAL REPOSITORY OF THE DEPARTMENT
OF PUBLIC SAFETY AND CORRECTIONAL SERVICES.
(B)
APPLICANTS FOR LICENSES UNDER
§
20-301 OF THIS SUBTITLE
AND INDIVIDUALS WHOSE NAMES MUST BE SUBMITTED TO THE SECRETARY
UNDER
§
20-303 OF THIS SUBTITLE SHALL APPLY TO THE CENTRAL
REPOSITORY FOR A NATIONAL AND STATE CRIMINAL HISTORY RECORDS CHECK
ON A FORM APPROVED BY THE DIRECTOR OF THE CENTRAL REPOSITORY.
(C)
THE CENTRAL REPOSITORY SHALL PROVIDE TO THE SECRETARY:
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(1)
THE NATIONAL AND STATE CRIMINAL HISTORY RECORDS OF
EACH INDIVIDUAL REQUIRING A CRIMINAL HISTORY RECORDS CHECK UNDER
SUBSECTION (B) OF THIS SECTION AND A PRINTED STATEMENT LISTING ANY
CONVICTIONS AND PLEAS OF GUILTY OR NOLO CONTENDERE TO ANY CRIMINAL
CHARGE;
(2)
AN UPDATE OF THE INITIAL CRIMINAL HISTORY RECORDS
CHECK FOR AN INDIVIDUAL REQUIRING A CRIMINAL HISTORY RECORDS CHECK
AND A REVISED PRINTED STATEMENT LISTING ANY CONVICTIONS AND PLEAS OF
GUILTY OR NOLO CONTENDERE TO ANY CRIMINAL CHARGE OCCURRING IN THE
STATE AFTER THE DATE OF THE INITIAL CRIMINAL HISTORY RECORDS CHECK;
AND
(3)
AN ACKNOWLEDGED RECEIPT OF THE APPLICATION FOR A
CRIMINAL HISTORY RECORDS CHECK BY AN INDIVIDUAL REQUIRING A
CRIMINAL HISTORY RECORDS CHECK.
(D)
AN
INDIVIDUAL REQUIRING A CRIMINAL HISTORY RECORDS CHECK
SHALL SUBMIT A COMPLETE SET OF LEGIBLE FINGERPRINTS TAKEN AT ANY
DESIGNATED STATE OR LOCAL LAW ENFORCEMENT OFFICE IN THE STATE OR
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HOUSE BILL 918
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OTHER AGENCY OR LOCATION APPROVED BY THE SECRETARY OF PUBLIC
SAFETY AND CORRECTIONAL SERVICES TO THE CENTRAL REPOSITORY.
(E)
AN
INDIVIDUAL REQUIRING A CRIMINAL HISTORY RECORDS CHECK
UNDER SUBSECTION (B) OF THIS SECTION SHALL PAY:
(1)
THE MANDATORY PROCESSING FEE REQUIRED BY THE
FEDERAL BUREAU OF INVESTIGATION FOR A NATIONAL CRIMINAL HISTORY
RECORDSCHECK;AND
(2)
THE FEE AUTHORIZED UNDER
§
10-221(B)(7) OF THE
CRIMINAL PROCEDURE ARTICLE FOR ACCESS TO MARYLAND CRIMINAL
HISTORY RECORDS.
(F)
A
BUYER OR AN APPLICANT MAY PAY FOR THE COSTS INCURRED BY
THE RESIDENT AGENT OR OTHER INDIVIDUAL REQUIRING A CRIMINAL HISTORY
RECORDS CHECK UNDER SUBSECTION (B) OF THIS SECTION.
(G)
(1)
INFORMATION OBTAINED BY THE SECRETARY FROM THE
CENTRAL REPOSITORY UNDER THIS TITLE SHALL BE CONFIDENTIAL AND MAY
BE DISSEMINATED ONLY TO THE INDIVIDUAL WHO IS THE SUBJECT OF THE
CRIMINAL HISTORY RECORDS CHECK.
(2)
NOTHING IN PARAGRAPH (1) OF THIS SUBSECTION SHALL
PRECLUDE THE SECRETARY FROM NOTIFYING A BUYER OR AN APPLICANT OF
THE APPROVAL OR DISQUALIFICATION OF THE RESIDENT AGENT FOR
EMPLOYMENT BASED ON INFORMATION OBTAINED BY THE SECRETARY UNDER
THIS SECTION.
(H)
THE SECRETARY SHALL VERIFY PERIODICALLY THE CONTINUED
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EMPLOYMENT OR LICENSURE OF INDIVIDUALS REQUIRING CRIMINAL HISTORY
RECORDS CHECKS IN ACCORDANCE WITH REGULATIONS ADOPTED BY THE
SECRETARY OF PUBLIC SAFETY AND CORRECTIONAL SERVICES.
20-305.
(A)
ON RECEIPT OF A COMPLETE NATIONAL AND STATE CRIMINAL
RECORD REPORT FROM THE CENTRAL REPOSITORY IN ACCORDANCE WITH
§
20-304 OF THIS SUBTITLE, THE SECRETARY SHALL ISSUE A LICENSE TO EACH
APPLICANT WHO MEETS THE REQUIREMENTS OF THIS SUBTITLE.
(B)
IS:
THE SECRETARY MAY NOT ISSUE A LICENSE FOR AN ADDRESS THAT
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HOUSE BILL 918
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(1)
(2)
A HOTEL OR MOTEL ROOM;
A MOTOR VEHICLE; OR
A POST OFFICE BOX.
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(3)
(C)
THE SECRETARY MAY NOT ISSUE MORE THAN ONE LICENSE FOR A
SINGLE BUSINESS LOCATION.
(D)
THE SECRETARY MAY NOT ISSUE A LICENSE TO A MINOR.
(E)
WHENEVER A LICENSE IS SUSPENDED OR REVOKED, ANOTHER
LICENSE MAY NOT BE ISSUED TO A BUYER FOR THE SAME BUSINESS LOCATION.
(F)
A LICENSE AUTHORIZES THE LICENSEE TO DO BUSINESS AS A
BUYER ONLY AT THE ADDRESS FOR WHICH THE LICENSE IS ISSUED.
20-306.
(A)
UNLESS A LICENSE IS RENEWED FOR A 2-YEAR TERM AS PROVIDED
IN THIS SECTION, THE LICENSE EXPIRES ON THE FIRST APRIL
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THAT COMES:
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(1)
(2)
AFTER THE EFFECTIVE DATE OF THE LICENSE; AND
IN AN EVEN-NUMBERED YEAR.
(B)
AT LEAST
1
MONTH BEFORE A LICENSE EXPIRES, THE SECRETARY
SHALL MAIL TO THE LICENSEE, AT THE LAST KNOWN ADDRESS OF THE
LI CENSEE:
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(1)
(2)
A RENEWAL APPLICATION FORM; AND
A NOTICE THAT STATES:
(I)
THE DATE ON WHICH THE CURRENT LICENSE EXPIRES;
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(II)
THE DATE BY WHICH THE SECRETARY MUST RECEIVE
THE RENEWAL APPLICATION FOR THE RENEWAL TO BE ISSUED AND MAILED
BEFORE THE LICENSE EXPIRES; AND
(III)
THE AMOUNT OF THE RENEWAL FEE.
(C)
BEFORE A LICENSE EXPIRES, THE LICENSEE PERIODICALLY MAY
RENEW IT FOR AN ADDITIONAL 2-YEAR TERM IF THE LICENSEE:
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HOUSE BILL 918
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SUBMITS TO THE SECRETARY A RENEWAL APPLICATION ON
THE FORM THAT THE SECRETARY PROVIDES;
(1)
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(2)
(3)
SIGNS THE RENEWAL APPLICATION UNDER OATH;
UPDATES THE INFORMATION SUBMITTED IN THE ORIGINAL
APPLICATION AND STATES THAT THE INFORMATION IS CURRENT;
EXCEPT AS PROVIDED IN SUBSECTION (D) OF THIS SECTION,
AGREES TO COMPLY WITH EACH REQUIREMENT APPLICABLE TO THE ORIGINAL
APPLICATION;
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(4)
(5)
STATES THAT THE LICENSEE:
(I)
HAS NOT VIOLATED THIS TITLE;
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(II)
HAS NOT BEEN CONVICTED OF AN OFFENSE SPECIFIED
IN
§
20-307
OF THIS SUBTITLE; AND
(III) HAS NOT HAD A SIMILAR LICENSE DENIED, SUSPENDED,
OR REVOKED IN ANOTHER JURISDICTION;
(6)
OTHERWISE IS ENTITLED TO BE LICENSED; AND
PAYS TO THE SECRETARY A RENEWAL FEE OF
$265.
(7)
(D)
THE SECRETARY MAY REQUIRE A LICENSEE TO SUBMIT A NATIONAL
AND STATE CRIMINAL HISTORY RECORDS CHECK WITH THE RENEWAL
APPLICATION.
(E)
THE SECRETARY SHALL RENEW THE LICENSE OF EACH LICENSEE
WHO MEETS THE REQUIREMENTS OF THIS SECTION.
(F)
A
LICENSE IS NOT TRANSFERABLE AND MAY BE USED ONLY TO
BENEFIT THE LICENSEE.
(G)
(1)
A
LICENSEE MAY CHANGE THE PLACE OF BUSINESS FOR
WHICH A LICENSE IS ISSUED ONLY IF THE LICENSEE:
(I)
SUBMITS TO THE SECRETARY AN APPLICATION TO
TRANSFER THE LICENSE TO A NEW BUSINESS LOCATION ON A FORM THAT THE
SECRETARY PROVIDES; AND
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(II)
SECRETARY.
RECEIVES
THE
WRITTEN
APPROVAL
OF
THE
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WITHIN
45
DAYS AFTER THE APPLICATION IS FILED WITH THE
SECRETARY, THE SECRETARY SHALL APPROVE OR DISAPPROVE THE
APPLICATION AND NOTIFY THE LICENSEE OF THE APPROVAL OR DISAPPROVAL
IN WRITING.
IF THE SECRETARY APPROVES A PROPOSED CHANGE OF
PLACE OF BUSINESS, THE LICENSEE SHALL ATTACH THE WRITTEN APPROVAL
OF THE SECRETARY TO THE LICENSE UNTIL AN AMENDED LICENSE IS RECEIVED
BY THE LICENSEE.
(H)
THE SECRETARY MAY DETERMINE THAT LICENSES ISSUED UNDER
THIS SUBTITLE SHALL EXPIRE ON A STAGGERED BASIS.
(2)
(3)
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20-307.
(A)
(1)
IN THIS SUBSECTION, A BUYER'S OR AN APPLICANT'S AGENTS,
EMPLOYEES, MANAGEMENT PERSONNEL, OR PARTNERS INCLUDE ONLY THOSE
INDIVIDUALS WHO ARE DIRECTLY INVOLVED IN TRANSACTIONS ON BEHALF OF
THE BUYER OR APPLICANT.
SUBJECT TO THE HEARING PROVISIONS OF
§
20-308
OF THIS
SUBTITLE, THE SECRETARY MAY DENY A LICENSE TO AN APPLICANT,
REPRIMAND A LICENSEE, OR SUSPEND OR REVOKE A LICENSE IF THE
APPLICANT OR LICENSEE OR AN AGENT, AN EMPLOYEE, A MANAGER, OR A
PARTNER OF THE APPLICANT OR LICENSEE:
(2)
(I)
FRAUDULENTLY OR
DECEPTIVELY OBTAINS
OR
ATTEMPTS TO OBTAIN A LICENSE FOR THE APPLICANT OR LICENSEE OR FOR
ANOTHER PERSON;
(II)
FRAUDULENTLY OR DECEPTIVELY USES A LICENSE;
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(III) HAS A SIMILAR LICENSE DENIED, SUSPENDED, OR
REVOKED IN ANOTHER JURISDICTION;
(IV) UNDER THE LAWS OF THE UNITED STATES OR OF ANY
STATE, IS CONVICTED OF:
31
1.
A FELONY; OR
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12
1
2
3
4
5
6
HOUSE BILL 918
A MISDEMEANOR THAT IS DIRECTLY RELATED TO
THE FITNESS AND QUALIFICATION OF THE APPLICANT OR LICENSEE TO BE
INVOLVED IN BUYING OR SELLING PERSONAL PROPERTY;
(V)
KNOWINGLY EMPLOYS OR KNOWINGLY CONTINUES TO
EMPLOY, AFTER BEING NOTIFIED BY THE SECRETARY, AN INDIVIDUAL WHO,
UNDER THE LAWS OF THE UNITED STATES OR OF ANY STATE, IS CONVICTED OF:
2.
7
8
9
10
11
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13
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15
1.
2.
A FELONY; OR
A MISDEMEANOR THAT IS DIRECTLY RELATED TO
THE FITNESS AND QUALIFICATION OF THE EMPLOYEE TO BE INVOLVED IN
BUYING OR SELLING PERSONAL PROPERTY;
(VI) WILLFULLY FAILS TO PROVIDE OR WILLFULLY
MISREPRESENTS ANY INFORMATION REQUIRED TO BE PROVIDED UNDER THIS
TITLE;
(VII) VIOLATES THIS TITLE; OR
(VIII) VIOLATES A REGULATION ADOPTED UNDER THIS TITLE.
(I)
INSTEAD OF OR IN ADDITION TO REPRIMANDING A
LICENSEE OR SUSPENDING OR REVOKING A LICENSE UNDER THIS SUBSECTION,
THE SECRETARY MAY IMPOSE A PENALTY NOT EXCEEDING
$5,000
FOR EACH
VIOLATION.
(II) To DETERMINE THE AMOUNT OF THE PENALTY
IMPOSED UNDER THIS SUBSECTION, THE SECRETARY SHALL CONSIDER:
16
17
18
19
20
21
(3)
22
23
24
1.
THE SERIOUSNESS OF THE VIOLATION;
THE HARM CAUSED BY THE VIOLATION;
THE GOOD FAITH OF THE LICENSEE; AND
ANY HISTORY OF PREVIOUS VIOLATIONS BY THE
2.
3.
25
26
27
28
LICENSEE.
4.
(4)
THE SECRETARY SHALL PAY ANY PENALTY COLLECTED
UNDER THIS SUBSECTION INTO THE GENERAL FUND OF THE STATE.
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HOUSE BILL 918
1
2
3
13
THE SECRETARY SHALL DISTRIBUTE PERIODICALLY TO ALL
BUYERS A LIST OF INDIVIDUALS WHOSE LICENSES HAVE BEEN REVOKED IN THE
STATE.
(B)
(1)
IF A LICENSEE IS CHARGED WITH A VIOLATION OF THIS TITLE
THAT COULD RESULT IN SUSPENSION OR REVOCATION OF THE LICENSE, THE
SECRETARY MAY SEEK FROM A CIRCUIT COURT AN IMMEDIATE RESTRAINING
ORDER TO PROHIBIT THE LICENSEE FROM:
(5)
4
5
6
7
8
9
(I)
(II)
(III)
(2)
BUYING OR SELLING PERSONAL PROPERTY;
DISPOSING OF PERSONAL PROPERTY; OR
DISPOSING OF A RECORD ABOUT PERSONAL PROPERTY.
10
11
12
THE RESTRAINING ORDER IS IN EFFECT UNTIL:
(I)
(II)
THE COURT LIFTS THE ORDER; OR
THE CHARGES ARE ADJUDICATED OR DISMISSED.
13
14
15
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18
19
20
21
22
23
24
(C)
THE SECRETARY SHALL CONSIDER THE FOLLOWING FACTS IN THE
GRANTING, DENIAL, RENEWAL, SUSPENSION, OR REVOCATION OF A LICENSE OR
THE REPRIMAND OF A LICENSEE WHEN AN APPLICANT OR A LICENSEE IS
CONVICTED OF A FELONY OR MISDEMEANOR DESCRIBED IN SUBSECTION (A)(2)
OF THIS SECTION:
(1)
THE NATURE OF THE CRIME;
(2)
THE RELATIONSHIP OF THE CRIME TO THE ACTIVITIES
AUTHORIZED BY THE LICENSE;
WITH RESPECT TO A FELONY, THE RELEVANCE OF THE
CONVICTION TO THE FITNESS AND QUALIFICATION OF THE APPLICANT OR
LICENSEE TO ACT AS A BUYER;
(3)
25
(4)
(5)
THE LENGTH OF TIME SINCE THE CONVICTION; AND
26
27
THE BEHAVIOR AND ACTIVITIES OF THE APPLICANT OR
LICENSEE BEFORE AND AFTER THE CONVICTION.
28
20-308.
@
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14
1
2
3
4
5
6
7
HOUSE BILL 918
EXCEPT AS OTHERWISE PROVIDED IN
§
10-226
OF THE STATE
(A)
GOVERNMENT ARTICLE, BEFORE THE SECRETARY TAKES ANY FINAL ACTION
UNDER
§
20-307
OF THIS SUBTITLE, THE SECRETARY SHALL GIVE THE
INDIVIDUAL AGAINST WHOM THE ACTION IS CONTEMPLATED AN OPPORTUNITY
FOR A HEARING BEFORE THE SECRETARY.
(B)
THE SECRETARY SHALL GIVE NOTICE AND HOLD THE HEARING IN
ACCORDANCE WITH TITLE
10,
SUBTITLE
2
OF THE STATE GOVERNMENT
ARTICLE.
(C)
THE SECRETARY MAY ADMINISTER OATHS IN A PROCEEDING
UNDER THIS SECTION.
(D)
IF, AFTER DUE NOTICE, THE INDIVIDUAL AGAINST WHOM THE
ACTION IS CONTEMPLATED DOES NOT APPEAR, NEVERTHELESS THE
SECRETARY MAY HEAR AND DETERMINE THE MATTER.
8
9
10
11
12
13
14
15
16
17
20-309.
A PARTY TO A PROCEEDING UNDER THIS TITLE WHO IS AGGRIEVED BY A
FINAL DECISION OF THE SECRETARY IN A CONTESTED CASE, AS DEFINED IN
§
10-202
OF THE STATE GOVERNMENT ARTICLE, MAY TAKE AN APPEAL AS
ALLOWED IN
§§
10-222
AND
10-223
OF THE STATE GOVERNMENT ARTICLE.
18
19
20
21
22
23
20-310.
THE SECRETARY SHALL INFORM EACH PRIMARY LAW ENFORCEMENT
UNIT OF EACH LICENSE THAT IS ISSUED, RENEWED, CHANGED TO A NEW
BUSINESS LOCATION, DENIED, SUSPENDED, OR REVOKED.
SUBTITLE
4.
AUTOMATED PURCHASING MACHINE TRANSACTIONS.
24
25
26
27
20-401.
(A)
A BUYER SHALL ENSURE THAT EACH AUTOMATED PURCHASING
MACHINE THAT THE BUYER OWNS OR OPERATES IN THE STATE MEETS THE
REQUIREMENTS OF THIS SECTION.
BEFORE THE COMPLETION OF A TRANSACTION IN WHICH AN
AUTOMATED PURCHASING MACHI.NE BUYS PERSONAL PROPERTY, THE
AUTOMATED PURCHASING MACHINE SHALL REQUIRE A SELLER TO PROVIDE
THE FOLLOWING INFORMATION:
28
29
30
31
00
(1)
32
(I)
THE FULL NAME OF THE SELLER;
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HOUSE BILL 918
15
1
(II)
(III)
THE DATE OF BIRTH OF THE SELLER;
THE COMPLETE HOME ADDRESS OF THE SELLER; AND
A CONTACT TELEPHONE NUMBER FOR THE SELLER.
2
3
4
(IV)
5
6
7
AUTOMATED
PURCHASING
MACHINE
RECEIVING
PERSONAL PROPERTY FROM A SELLER SHALL VERIFY THE INFORMATION
PROVIDED BY THE SELLER UNDER PARAGRAPH
(1)
OF THIS SUBSECTION BY
REQUIRING THE SELLER TO SUBMIT:
(I)
CARD;OR
OTHER FORM
INFORMATION REQUIRED BY THE SECRETARY.
THE SELLER'S GOVERNMENT-ISSUED IDENTIFICATION
(2)
AN
8
9
10
11
(II)
ANY
OF
PERSONAL
IDENTIFYING
12
13
14
15
16
ON COMPLETION OF A TRANSACTION IN WHICH AN
AUTOMATED PURCHASING MACHINE BUYS PERSONAL PROPERTY, THE
AUTOMATED PURCHASING MACHINE SHALL
MAKE
A RECORD OF THE
TRANSACTION THAT INCLUDES:
(I)
THE INFORMATION OBTAINED FROM THE
UNDER SUBSECTION
(A)
(1)
(B)(1) OF THIS SECTION;
(II)
A PHOTOGRAPH OF THE SELLER;
SELLER
(1)
17
18
19
20
21
(III) AN ELECTRONIC COpy OR A PHOTOCOPY OF THE
IDENTIFYING INFORMATION SUBMITTED UNDER SUBSECTION
(l".)(1I)
(B)(2) OF
THIS SECTION;
22
(IV)
AND
THE DATE, TIME,
AND
LOCATION OF THE TRANSACTION;
23
24
25
26
27
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29
30
(V)
A DESCRIPTION OF THE PERSONAL PROPERTY,
INCLUDING A STATEMENT WHETHER THE PERSONAL PROPERTY APPEARS TO
HAVE BEEN ALTERED.
(2)
(I)
IN ADDITION TO THE INFORMATION REQUIRED UNDER
PARAGRAPH
(1)
OF THIS SUBSECTION, IF THE PERSONAL PROPERTY BOUGHT BY
AN AUTOMATED PURCHASING MACHINE IS AN ELECTRONIC DEVICE, THE
AUTOMATED PURCHASING MACHINE SHALL MAKE A RECORD OF:
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16
1
2
3
4
HOUSE BILL 918
1.
DEVICE; AND
THE MAKE AND MODEL OF THE ELECTRONIC
THE SERIAL NUMBER OF THE
DEVICE IF IT CAN BE DETERMINED AT THE TIME OF PURCHASE.
2.
ELECTRONIC
5
6
7
(II)
A
SERIAL NUMBER THAT AN AUTOMATED PURCHASING
MACHINE GENERATES TO RECORD A TRANSACTION DOES NOT QUALIFY AS A
SERIAL NUMBER FOR PURPOSES OF THIS PARAGRAPH.
8
9
(3)
A
SEPARATE ENTRY SHALL BE MADE FOR EACH ITEM OF
PERSONAL PROPERTY INVOLVED IN A TRANSACTION.
20-402.
(A)
(1)
(I)
A
SUBJECT TO P:r\B;laolIMtPII
SUBPARAGRAPH
(III) OF
THIS
8UB8"BO'lIO!P'1
PARAGRAPH,
A BUYER SHALL SUBMIT A COpy OF THE
RECORDS REQUIRED UNDER
§
g9
491~~
§
20-401(C) OF THIS SUBTITLE TO THE
PRIMARY LAW ENFORCEMENT UNIT WITHIN 48 HOURS AFTER A TRANSACTION
IN A PAPER OR ELECTRONIC FORMAT ACCEPTABLE TO THE PRIMARY LAW
ENFORCEMENT UNIT.
(II) IF A SERIAL NUMBER CANNOT BE DETERMINED AT THE
TIME OF THE TRANSACTION, A BUYER SHALL SUBMIT TO THE PRIMARY LAW
ENFORCEMENT UNIT:
A PRELIMINARY REPORT CONTAINING THE
INFORMATION REQUIRED UNDER
§
g9 491(B)
§
2o-401(C) OF THIS SUBTITLE,
EXCEPT THE SERIAL NUMBER, WITHIN 48 HOURS AFTER THE TRANSACTION;
10
11
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15
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19
20
1.
21
22
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25
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27
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AND
A FINAL REPORT CONTAINING THE INFORMATION
REQUIRED UNDER
§
g9 491(B)
§
20-401(C) OF THIS SUBTITLE, INCLUDING THE
SERIAL NUMBER, WITHIN
.}4
17
DAYS AFTER THE TRANSACTION.
THE PROVISIONS OF SUBPARAGRAPH
0)
OF THIS
PARAGRAPH MAY NOT BE CONSTRUED TO REQUIRE A BUYER TO INCUR A
SUBSTANTIAL FINANCIAL BURDEN TO COMPLY WITH THE REQUIREMENTS OF
THIS PARAGRAPH.
(2)
A
BUYER SHALL KEEP THE RECORDS REQUIRED UNDER
§
g9 491(B)
§
2o-401(C) OF THIS SUBTITLE FOR AT LEAST 1 YEAR AFTER THE
DATE OF THE TRANSACTION.
2.
1.llil.
31
32
33
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HOUSE BILL
918
17
1
2
(3)
A
COPY OF A RECORD SUBMITTED UNDER
§
gO tOl(B)
§.
20-401(c) OF THIS SUBTITLE:
3
(I)
(II)
SHALL BE KEPT CONFIDENTIAL;
IS NOT A PUBLIC RECORD; AND
4
5
6
7
8
9
10
(III) IS NOT SUBJECT TO TITLE 10, SUBTITLE
6
OF THE
STATE GOVERNMENT ARTICLE.
(B)
ill
A
BUYER SHALL KEEP ALL PERSONAL PROPERTY BOUGHT
FOR AT LEAST 30 DAYS AFTER THE BUYER SUBMITS THE INFORMATION
REQUIRED UNDER
§
gO tOl(B)
§
20-401(C) OF THIS SUBTITLE TO THE PRIMARY
LAW ENFORCEMENT UNIT.
ON THE REQUEST OF THE PRIMARY LAW ENFORCEMENT UNIT.
A BUYER SHALL PROVIDE TO THE PRIMARY LAW ENFORCEMENT UNIT ANY
PERSONAL PROPERTY PURCHASED BY AN AUTOMATED PURCHASING MACHINE
AT THE COST OF THE BUYER.
11
12
13
14
ill
15
16
17
18
19
20
21
22
23
24
25
26
27
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.<ill
A
BUYER SHALL MAKE ALL PERSONAL PROPERTY PURCHASED BY
AN AUTOMATED PURCHASING MACHINE AVAILABLE FOR INSPECTION BY THE
PRIMARY LAW ENFORCEMENT UNIT AT ANY TIME.
.<m
ill
ill
A
BUYER SHALL REMOVE ALL ITEMS OF PERSONAL PROPERTY
FROM AN AUTOMATED PURCHASING MACHINE IN INTERVALS OF NO LESS THAN
10 DAYS.
A
BUYER SHALL NOTIFY THE PRIMARY LAW ENFORCEMENT
UNIT OF THE DATE AND TIME THE BUYER WILL REMOVE PERSONAL PROPERTY
FROM AN AUTOMATED PURCHASING MACHINE AT LEAST 72 HOURS BEFORE
REMOVING THE PERSONAL PROPERTY.
THE PRIMARY LAW ENFORCEMENT UNIT MAY INSPECT THE
PERSONAL PROPERTY BEING REMOVED FROM AN AUTOMATED PURCHASING
MACHINE AT THE TIME OF THE REMOVAL.
20-403.
(A)
(1)
(I)
A
BUYER SHALL USE AN INDIVIDUAL TO SCREEN EACH
TRANSACTION IN WHICH AN AUTOMATIC PURCHASING MACHINE BUYS
PERSONAL PROPERTY.
m
31
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18
1
2
HOUSE BILL 918
(II)
AN
INDIVIDUAL WHO SCREENS A TRANSACTION MAY
SCREEN THE TRANSACTION REMOTELY.
A BUYER SHALL KEEP A RECORD
ASSIGNED TO SCREEN EACH TRANSACTION.
3
4
5
6
(2)
OF THE
SCREENER
(B)
IF A BUYER DETERMINES THAT PERSONAL PROPERTY SOLD TO AN
AUTOMATED PURCHASING MACHINE IS STOLEN, THE BUYER SHALL:
CONTACT THE PRIMARY LAW ENFORCEMENT UNIT AS SOON AS
PRACTICABLE; AND
RETURN THE PERSONAL PROPERTY TO THE PRIMARY LAW
ENFORCEMENT UNIT FREE OF CHARGE.
SUBTITLE
5.
PROHIBITED ACTS; PENALTIES.
7
8
(1)
9
10
11
12
13
14
15
16
17
(2)
20-501.
A BUYER MAY NOT BUY OR OFFER TO BUY PERSONAL PROPERTY
FROM A MINOR.
IF AN AUTOMATED PURCHASING MACHINE CANNOT DETERMINE
THE SERIAL NUMBER OF AN ELECTRONIC DEVICE AND THE DEVICE IS VALUED
AT
$25
OR MORE, THE BUYER MAY NOT PURCHASE THE ELECTRONIC DEVICE.
W
00
18
19
20
21
22
23
24
25
20-502.
(A)
A PERSON WHO KNOWINGLY OR WILLFULLY VIOLATES THIS TITLE IS
GUILTY OF A MISDEMEANOR AND ON CONVICTION IS SUBJECT TO:
(1)
AND
FOR A FIRST OFFENSE, A FINE NOT EXCEEDING
$899,
$1,000;
(2)
FOR A SECOND OR SUBSEQUENT OFFENSE, A FINE NOT
EXCEEDING
$1,999.
$5,000.
(B)
EACH VIOLATION OF THIS TITLE IS A SEPARATE OFFENSE.
26
27
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect
October
1, 2014.
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TESTIMONY ON BEHALF OF COUNTY EXECUTIVE ISIAH LEGGETT ON
EXPEDITED BILL 18-14, SECONDHAND PERSONAL PROPERTY - AUTOMATED
PURCHASING MACHINES
April 8,
2014
Good afternoon President Rice and Members of the County Council. I am
Captain Laura Lanham, Director of the Criminal Investigations Division of the Montgomery
County Police. I am here on behalf of County Executive Isiah Leggett and Chief Tom Manger to
testify on Expedited Bill 18-14, Secondhand Personal Property Automated Purchasing
Machines.
These self-service kiosks dispense cash payments for cell phones and other
electronic devices. Baltimore City and Baltimore County recently enacted local laws prohibiting
the use of such machines based on concern that they provide thieves greater opportunity to
convert stolen electronic goods to cash. Mr. Leggett agrees that these machines have no place in
Montgomery County at this time, and further analysis is needed to determine if, and when, they
may be permitted in the future.
Some jurisdictions that have automated purchasing machines have shown an
increase in street robberies and thefts, although a direct correlation has not been proven. These
machines allow an individual to sell property -regardless ofhow the property was obtained - at
vending machines rather than face-to-face with proper documentation and proof of identification.
Our current system of secondhand-property sales within Montgomery County
requires the seller to sell to an individual and the record of that sale identifying the seller to be
sent to the police department in a timely manner. The proliferation ofthese machines may
circumvent our current system, thus creating an environment where the use of fake IDs may
make the identification of the seller difficult to determine. We are concerned about the possible
increase of crimes to obtain personal property, to include armed robbery, for a quick sale at an
automated purchasing machine.
Proponents of automated purchasing machines argue that the machines promote
recycling rates and actually serve as a deterrent to crime through their technology. While it is
Mr.
Leggett's view that there is not sufficient historical experience to prove this, he is open to
alternatives to an outright ban that would prevent the proliferation of these machines in
Montgomery County until such time as their crime-fighting benefits are clearly shown, as
determined by the Chief of Police. This would also allow State-level regulatory efforts (passed
during the 2014 legislative session of the Maryland General Assembly) to take effect and would
prevent Montgomery County from becoming a "hot spot" for street crimes.
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ALEXANDER
&'
CLEA VER
ATTORNEYS AT
Professional Association
Gary
R.
Alexander
+* A
James
A.
Cleaver
+*
Denise M. Bowman
+*
MARYLAND. DISTRICT OF COLUMBIA. V1RGINIA
(301) 545-0100
FAX (301) 424-3418
LAW
401 East Jefferson Street
Suite 201
Rockville, MD 20850
OFFICES:
ANNAPOLIS, MD
FORT WASHINGTON, MD
CUMBERLAND, MD
LAPLATA,MD
ALEXANDRIA, VA
GOVERNMENT RELATIONS CONSULTANTS:
Robert J. Garagiola
+'
Todd
K.
Pounds
+'
Jason
A.
DeLoach
+
James K. McGee
+
Lorenzo M. Bellamy
+'
Shara
Hendler
+
S. Whitney Cleaver
+'
A
Eliot C. Schaefer
+A
Camille G. Fesche
+*.0
ADMlTIED TO PRACTICE IN
+
MD • DC '" VA •
NJ
0 NY
e-mall: ac@alexander-cleaver.com
www.a1exander-cleaver.com
TOLL FREE 1-800-292 LAWS
Casper
R.
Taylor, Jr.
Robin Fogel Shaivitz
Lyle W. Fowlkes
Hannah
Powers Garagiola
Kerry
R.
Watson. Jr.
Murray D.
Levy
Tyler W. Beunett
TESTIMONY BEFORE THE MONTGOMERY COUNTY COUNCIL
EXPEDITED
BILL
18-14, SECONDHAND PERSONAL PROPERTY ­
AUTOMATED PURCHASING MACHINES
April 8,
2014
Mr.
President and members of the Council: Good afternoon. This is the fIrst time since holding public
office that I am testifying on any legislation.
First, I applaud Council President Rice and others for seeking solutions to reduce cell phone theft.
It
is
an epidemic and a nuisance. Unfortunately, there are too many avenues for cell phone thieves to obtain
cash for stolen phones.
Second, I do not believe that automated purchasing machines ("APMs") lead to more cell phone theft.
Rather, I believe that such machines can be useful tools for law enforcement to apprehend cell phone
thieves and perpetrators of other crimes, and to return stolen cell phones to their lawful owner. This fact
will only be enhanced by enactment of House Bill 918 - Business Regulation - Automated Purchasing
Machines - Licensing of Buyers and Required Records, which passed the House and Senate
unanimously during the 2014 Maryland General Assembly session. A summary ofthe legislation is
attached for your reference.
Third and fmally, I respectfully urge the withdrawal ofthis bill. Instead, I urge the County to pursue a
memorandum of understanding ("MOU") between the County and ecoATM the only automated
purchasing machine company in the State of Maryland. The nature of an MOU would be that
if
ecoATM
wanted to bring a kiosk to the County, the County would need to consent. This approach provides
greater flexibility
than
a statutory ban. Presently, ecoATM has no plan to come to the County, but at
some point in the future, the County or ecoATM may desire one or more ecoATM kiosks in the County.
Furthermore, an MOU more easily enables the County to see the effects of the state legislation on the
regulation of APMs in other jurisdictions before deciding on a course of action.
In
sum, an MOU
approach - rather than a statutory ban - would provide the flexibility and discretion for the County to
make such a decision at the appropriate time.
@
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Summary of HB 918
• Effective Date: October 1, 2014.
• Establishes state licensing process.
• Creates statewide uniform regulatory authority of APMs, but does not prohibit local
government from licensing APMs.
• Application for state license, states that applicant agrees "to allow a municipal,
county, or state police officer or agent acting in the course of a stolen property
investigation...to inspect and photograph all personal property and records" at the
APM business or storage locations.
• Local government designates primary law enforcement unit to receive APM
records.
• Seller must provide before completion of APM transaction:
o
o
o
o
Full name;
Date of birth;
Home address; and
Telephone number.
• APM shall verify information by requiring seller to provide government-issued
identification card.
• APM company shall have an individual (remotely acceptable) screen each APM
transaction.
• Before completion of a transaction, APM must make a record for law enforcement
that includes:
Information above provided by seller;
Photograph of seller;
Seller's government-issued identification card;
Date, time, location of transaction;
Description of property, including a statement whether the property appears to have been
altered; and
o Make and model of electronic device.
o
o
o
o
o
• The record must be provided to law enforcement designee within
48
hours of
transaction.
• Unless serial number of the product cannot be determined at the time of
transaction, it must also be provided within
48
hours to law enforcement designee
• If
cannot determine serial number at time of purchase, then have 17 days to provide
to law enforcement; however, cannot purchase an electronic device for more than
$25
if
cannot determine the serial number at the APM.
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• Records must be kept for one year after transaction.
• Property must remain in APM for at least 10 days before removal and must notify
law enforcement 72 hours in advance prior to removing property from APM.
• APM company must keep all property for 30 days after submitting records to law
enforcement.
• On request of law enforcement, APM company must provide law enforcement
property purchased by an APM at the cost of APM company.
• Cannot purchase from minor.
• Law enforcement may inspect any APM purchase at any time.
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--
Testimony before Montgomery County Council 4/8/2014
-.
<
Good afternoon. My name is Michael McCann. I am the retired Chief of Police of
the River Vale Police Department in New Jersey. I am a graduate of the FBI
National Academy in Quantico, Virginia and I recently served as the Chairman for
Crime Prevention and Criminal Intelligence for the Bergen County Police Chiefs
Association. I am here in Montgomery County in my capacity as the Director of
Law Enforcement Relations for ecoATM, I respectfully oppose the ban legislation.
ecoATM is the ONLY operator of interactive kiosks that provide a safe, secure, and
an environmentally friendly way to sell your used cell phone, MP3 player or
tablet.
Cell phone theft is a national problem. Cities and counties nationwide are
experiencing increased crime all too frequently; the thief is after your phone or
other electronics. We recognize that Montgomery County is not immune to this
trend and that it is a very real problem facing the county.
Let me be very clear about our intentions; Cell phone theft is bad for our business
at ecoATM, and we want to prevent it as much as the County Executive, County
Police Chief and the entire Montgomery County Council.
In the past 14 months in the State of Maryland we have recycled
51,800
devices
and of those,
150
have been requested by law enforcement, which is a fraction of
1%.
In those cases we worked with laws enforcement to return the device to the
rightful owner and provide law enforcement with suspects .
. Our kiosks operate in a way that makes it tougher for cell phone thieves to use
our machines. First, before any transaction begins we advise the person at the
kiosk that the information from the sale WILL be shared with law enforcement.
Our security features start with an ID Scanner which requires the seller to present
a valid ID. In addition to our live attendant approval process our state of the art ID
scanner and validation software will not only photograph the ID but validates for
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authenticity by examining for holograms, watermarks, or other specific
authentication methods used in all 50 states.
The next step in the process is the inspection of the phone or other device. Where
the machine detects the make and model of the phone, based on that
information a cord is released for that particular device and this is where we
attempt to capture the serial number for the device. Based on the information we
receive we will make an offer for the device where the seller can either accept or
decline to proceed. If they accept we retrieve 3 images of them using 3 different
high resolution cameras, including a fish eye camera to see if there are others
present at the machine at a wider angle.
This is where a
live
agent views the person standing at the kiosk and compares it
to the government identification that was submitted to verify that this is the same
person
Before the sale is final we require a thumb print.
We have had positive communication from detectives from around the country
thanking us for the information that we provide that has helped solve crimes.
When law enforcement wants a device we give it to them, we do not require a
subpoena or a search warrant. If the device is stolen it is returned at a complete
loss to the company.
We hold all collected devices for a minimum of 30 days, an"d upon request we can
extend the holding period for longer.
To further support law enforcement the agency can come to the kiosk and call our
company and request that we remotely open the door at the machine for law
enforcement to inspect or retrieve any device they wish to inspect further.
We can upload an agency specific
liDo
Not Buy List", meaning if Montgomery
County asks that we don't buy from people on a list that they provide we will not
buy from them as they will be flagged. We will also flag someone that has been
reported to have sold a stolen device in the past.
@
 PDF to HTML - Convert PDF files to HTML files
All of the information retrieved is provided to the law enforcement through a pdf
to the police department the regulatory bill also requires that we provide all
l
transaction information into
BWI
Rapid.
Our engineers are building analytics into our system which will flag suspicious
transactions and report them to law enforcement such as a person using kiosks
l
at multiple locations or recycling an unusual number of devise over certain time
period.
We currently do not operate in Montgomery County. Our parent company
Outerwall
l
which owns Coinstar and Redbox in 2013 did over 30 million dollars in
revenue and paid 2.5 million in taxes. As a former Chief of Police I am very proud
of our partnerships with law enforcement and the efforts that we make to be
completely transparent.
Thank you and I welcome questions.
 PDF to HTML - Convert PDF files to HTML files
-
/
SECOND HAND DEALER REPORT
c
u
S
T
RAlI/8.I'~CTION
DA1E
N
F
0
M
0
E
R
STORE
INFO
MECHANICS
iYES
T
E
M
D
M
A
G
E
W
E
M
B
A
C
G
A
E
M
S
Cuslomer
elecIrooically
acknowledged
that
they
WMl
the
owner
or aulhorized
by
the
owner
10
seD
the
property.
SIGNATURES
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Frequently Asked Questions - ecoATM
Page 1 of3
(http(~
(http://www.ecoatm.com)
~
ec6ATM
Frequently Asked Questions
What devices
can
I bring
to an
ecoATM?
We currently accept phones, MP3 players and tablets.
How does ecoATM determine pricing?
ecoATM prices each phone based on:
Model
SpecifIC
condition
Value
in
the
secondary
marlcets
The price range is significant. While we may not be able to pay for some older models, newer devices
can fetch up to $300. The specific condition of each individual phone is carefully determined by the
ecoATM machine vision systems, electrical diagnostics, and artificiaL intelligence system in order to get
the best price we can flnd in secondary markets. For example, a phone with water damage or a broken
LCD
will be worth less than a fully functional phone, and an older phone will be priced at a lower price
than a phone that's still performing well in the current market.
How does
ecDATM
pricing compare with seWng my phone onUne?
ecoATM shops worldwide channels for the best prices we can find for each individual phone model (we
fully vet our buyers to make sure they
meet
environmental standards). Our prices are competitive with
other cell phone buyback services and we accept more kinds of devices than most of our competitors.
http://www.ecoatm.comlfrequently-asked-questions/
4/2312014
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Frequently Asked Questions - ecoATM
Page 2 of3
ecoATM also provides immediate evaluation and payment, unlike online methods that can take as long
as 45 days to pay. Additionally, in online selling, consumers "gradeR the condition of their own phone
and it is often the case that once the buyers disagree with that condition "grading" and in turn offer
substantially less than was originally quoted and expected. This never happens with ecoATM.
Does ecoATM acceptaccessories, Uke chargers!
ecoATM accepts aU chargers and other accessories (cases,
etc.)
for recycling whether they're working
or not, but we cannot pay for the accessories.
Does my devke have
to
be
charged before I visit ecoATM/ Ifso, should I bring my
own
cord
to
charge
it?
Your device does not have to be charged - though keep in mind that whether or not the phone powers
up will affect pricing. During its price assessment, ecoATM will offer you the appropriate cord for your
device. We also have charging stations attached to most kiosks.
What happens
to
my
device once I've endedmy transaction and it's in the ecoATM!
The majority of the devices we receive are reused, while the remaining devices are recycled.
Almost all consumer electronics contain toxic materials such as lead, mercury, arsenic and a broad
variety of other materials that pose a threat to the environment and our health. The best thing we can
do is to extend the life of existing devices as long as possible so that there is no need to build new
devices to take their place. The next best thing we can do is to responsibly reclaim materials from
devices that are truly end-of-life.
For more on this, please visit our Going Green (http://www.ecoatm.com/going-green/) page.
Is it true that ecoATMs
operate
totally
on
their own, without
any
humans involved!
This is false. Whenever someone uses an ecoATM, they are required to present a valid ID, which is then
scanned so our team of online attendants (reaL live human beings) can check it against multiple photos
the ecoATM has taken of the seller in front of the machine. The transaction will be declined if:
The person doesn'tmatch the ID
I(they're under
18
years
old
The ID is invaUd
Though we love and trust our machines, you can rest assured that you are never alone when you're
visiting your localecoATM.
How do you work with law enforcement!
Along with the steps above, ecoATM collects information about each phone and scans each seller's
thumbprint at the kiosk. This information, along with the photos taken of the seLLer and their 10, is
shared with police and also sent to nationwide electronic databases like leadsOnline or Business Watch
Internationals' RAPID system. We also hold all phones at our proceSSing facility for 30 days after the
initial transaction, in case we need to return a device to its owner.
What steps haveyou taken
to
protect mystolen phone from beingsold
at an
ecoATM!
We work closely with police on their investigations. Police officers will tell you that we cooperate well
beyond what we are required to by Law to help them get the data they need to catch thieves.
http://www.ecoatm.comlfrequently-asked-questions/
4/23/2014
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Frequently Asked Questions - ecoATM
Page 3 of3
We're also honored to work with a law enforcement advisory board made up of retired Chiefs,
Commissioners, head detectives, and officers from some of the biggest police and sheriffs
departments in the country who provide us with guidance and ideas on how best to help local law
enforcement.
We collect thousands of phones each day and fewer than 1 lost or stolen phone winds up in an ecoATM
for every 1,500 phones we collect. But if you do happen to have your phone lost or stolen and
it
ends up
in an ecoATM, we will return it to you at no cost. That is a guarantee.
Can I
buy
or
franchise an
ecoA
TM
kiosk?
Not at this time. ecoATM builds, owns, maintains and installs the kiosks in high-traffic retail locations.
ecoATM has become aware that individuals or entities unrelated to ecoATM are offering to sell, lease or
license ecoATM kiosks. Please be advised that ecoATM does not sell,lease or Ucense its kiosks, and has
not authorized any individuals or entities to sell, lease or license its kiosks. Please disregard any such
offers and report them (mailto:max@ecoATM.com) so that we may take appropriate action to prevent
any potential fraud to consumers or harm to our business.
(http://www.ecoatm.com)
ecoATM is the world's first automated eWaste recycling station. That's
a
fancy way
ofsaying that we're
a
friendly green machine looking
to
pay cash for the
responsible recycling ofyour old cell phones. MP3 players and tablets. Sell your
phone
or
other device by placing
it
in the ecoATM kiosk. and we'll tell you how much
it's worth. What happens next? You get instant cash. With ecoATM kiosks all over
the country. and with your help. we're working hard
to
solve the eWaste problem
facing our planet.
Support
Customer Service
(http://www.ecoatm.com/customer­
service)
Privacy PoUcy
(http://www.ecoatm.com/privacy­
policy)
Terms
and
Conditions
(http://www.ecoatm.com/terms­
and-conditions)
Press Room
Press Kit
(http://www.ecoatm.com/press­
kit)
Company
About Us
(http://www.ecoatm.com/about­
us)
Charities
(http://www.ecoatm.com/charities)
Careers
(http://outerwalLcom/careersl)
Law Enforcement
(http://www.ecoatm.com/taw­
enforcement)
About Outerwall
(http://www.ecoatm.com/about­
outerwall)
eZ013
OuterwaU Inc. (http:;/outerwallcom)AllRights Reserved. OuterwaU and ecoATM and their associated logos are trademarks of Outerwallinc. or its
subsidiaries.
@
http://www.ecoatm.comlfrequently-asked-questions/
4/23/2014
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Law Enforcement F AQs - ecoATM
Page 1 of 4
(bttp(~
(bttp:llwww.ecoatm.com)
~
ec6ATM
Law Enforcement FAQs
There is
an
inquiry about a specific phone which may have been sold at
an
ecoATM machine.
How
can we
get
a
device
back
when it's in the kiosk!
We can open our kiosk for any member of law enforcement who can produce credentials. Here's how:
and select the Law Enforcement option.
2. You'll be connected to an attendant who will gather important information to verify that you are indeed law enforcement.
3. Once they've verified your identity, they'll connectyou with one of our technicians who will remoteLy open the kiosk for you and
direct you to the stored device.
1.
Call our ecoATM Support Line at 858-324-4111
How can we get back
a
device when it's in transit?
You can contact your state's Regulatory Affairs representative or our ecoATM Support Line who will flag the device. Once it has
reached our headquarters, it will be retrieved and mailed back to your department.
How
can
we get back
a
device when
it's at
the ecoATM headquarters?
Ifyou request the device within 30 days of the transaction, it wilL be retrieved and maiLed back to you ASAP.
How does ecoATM verify that a person's
ID
is
his or her own?
The first step of the ID process involves verifying the ID card presented. ecoATM uses a state-of-the-art ID scanner and vaUdation
software that not onLy photographs the ID but validates for authenticity by examining the
10
for holograms, watermarks, or other
specific authentication methods used in all
SO
states. Images Of these IDs are collected, stored, and are available as part of the daily
reports provided byecoATM to your precinct. Once the ID is verified, the user is permitted to proceed; however, this does not mean
that the person has been approved to complete a transaction.
Prior to completing the final transaction, using the kiosk's built-in webcams, a remote attendant in San Diego, CA compares the
photo ID with the user's face in real-time to confirm or deny every transaction. In order to pass verification, a person must provide
a valid ID and must be at least 18 years of age. The attendant will verify the age on the License and make sure it
has
not expired
before the consumer is allowed to move forward in selling back the device.
Can
law enforcement have access to the kiosk?
Yes,
if
you're an on-duty,
law
enforcement officer conducting
a
criminal investigation and need
access
to one
of
the devices
inside the kiosk we
can
absolutely pop open the front door for you remotely. Here's what to do:
http://www.ecoatm.comllaw-enforcement-faqs/
4/23/2014
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Law Enforcement F AQs - ecoATM
Page 2 of4
1. Call our ecoATM Support Line at 858-324-4111 and select the Law Enforcement option.
2.
You'll be connected to an attendant who will gather important information to verify that you are indeed law enforcement
3. Once they've verified your identity, they'll connect you with one of our technicians who will open the kiosk for you and direct you
to the stored devices.
Can you report the transactions? And how do Iget access to the reports?
ecoATM has a partnership with the leading online reporting service, LeadsOnline. We upload every transaction daily into their
database. We provide law enforcement access to those reports free of charge. If your department has other needs we can report
our transactions to you in the manner you prefer (e.g. via email, fax, or other online reporting systems.)
Who should we contact if we have a question or need assistance?
Ifyou have a reporting or technical question, please contact your state's ecoATM Regulatory Affairs representative. Your state's
representative wiLL be abLe to assist you with more specific questions or concerns regarding the kiosk workings and transactions.
You can reach your state's primary contact by caLling the Regulatory Affairs Specialist, Paul Cashman, at 858-766-7237. He will be
abLe to answer your question or connect you with your state's representative.
For broader matters, your primary contacts at ecoATM will be our West Coast Director of Law Enforcement Relations Max Santiago,
retired Deputy Commissioner of the California Highway PatroL-or our East Coast Director of Law Enforcement Relations MichaeL
McCann, retired Chief of Police of the River VaLe PoLice Department. Both Santiago and McCann bring years of law enforcement
experience to ecoATM and Lead the company in its commitment to working closeLy with law enforcement. They are aLways availabLe
for questions about the company-and weLcome the opportunity to speak with your Chief or Executive Staff.
You can contact Max Santiago at max.santiago@outerwaLLcom and 858-461-9968 or Mike McCann at
michaeLmccann@outerwalLcom and 201-739-7287.
What form aflD does ecoATM require?
ecoATM requires every user to present a vaLid US state-issued ID. ecoATM has invested in state of the art technoLogy, identification,
and verification systems that capture real time data on aLL the individuals recycling phones at our kiosks.
How is the ID determined to be valid?
For each transaction. ecoATM uses a state-of-the-art ID scanner and AssureTec Reader vaLidation software. This process enabLes
us to photograph the user's 10 and validate its authenticity by examining the ID for hoLograms, watermarks, or other specific
authentication methods used in aLL 50 states. In addition to scanning the
10,
a remote ecoATM attendant examines each consumer,
real-time. through the kiosk's built-in webcams and ensure they match the person who is depicted on the government-issued 10.
Do customers have to pay to gettheir phones back]
ALL Lost or stoLen devices are returned to the owner. free of charge. if requested by a Law enforcement officer as long as the
customer provides us with a police report for the stolen device and written authorization from law enforcement to release the
device.
If a customer caUs stating their phone has been Lost or stoLen, and they believe it
is
in an ecoATM. are there any directions I
should give them regarding his or her device and the process to retrieve it from ecoATMl
http://www.ecoatm.comllaw-enforcement-faqs/
4/23/2014
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Law Enforcement FAQs - ecoA TM
Page 3 of4
1. Please direct the individual to notify his or her carrier of the situation so they can:
a) Suspend service temporarily and b) ask for the phone's IMEI or MElD number. (lMEI stands for International Electronic Identifying
number and is the most important piece of information we use to track the devices recycled in our machine.)
Many phones also have features that allow you to track or lock them remotely, or even wipe the personal data they contain. If they
have enabled these features on their phone, they may want to try to track it that way. If they are not sure if they have these
features, they should call their carrier to best determine how to identify the phone.
2. From there, direct the individual to call ecoATM Support Line at 858-324-4111.
ecoATM customer service will work with them to ensure their stolen phone is returned to them at no additional charge as quickly as
possible.
How long do you hold the devices?
ecoATM holds all devices for at least
30
days (Longer if required by state or local laws and/or regulations).
How can I find out if there are any kiosks near me?
You can go to ecoATM.com/find-a-location. It will show all the kiosks located in your area. You can also call our customer service
team at 858-324-4111.
What information is gathered when the device is plugged in at the kiosk? I've noticed that not all transactions in Leads OnUne
Ust the serial number, but Ust processing instead. Does this get updated? If so, at what point?
Our kiosk has the ability to electronically extract serial numbers. However, this isn't always technically possible due to the
extremely wide range of makes, models, ages, and conditions of devices that we accept. In any instance where the machine cannot
electronically extract the serial number, an ecoATM attendant will manually captures the serial number as soon as the device
reaches our processing center in San Diego, CA.
All manually captured serial numbers are updated, both in our own database and with the online reporting services we utilize.
How often are the devices cleared from the machines?
The devices are cleared from the machine once a week by an armored car service.
When attempting to retrieve a phone, what information should I have?
The best piece of information you can provide us to track the device is the IMEI or MElD number. If these are not available, any
information you have about the device, the seller, or the transaction will be useful
My question is not Usted here. Who can I contact to get more information?
Please direct any outstanding questions you might have to Paul Cashman, ecoATM's Regulatory Affairs Specialist, at 858-381-4236
or email him at paul.cashman@outerwalLcom.
Back To Law Enforcement Homepage (http://www.ecoatm.com/law-enforcement/)
http://www.ecoatm.com/law-enforcement-faqs/
4/2312014
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Law Enforcement F AQs - ecoATM
Page 4 of4
(http://www.ecoatm.com)
ecoATM is the world's first automated eWaste recycling station. That's
a
fancy way
of
saying that we're
a
friendly green machine looking
to
pay cash for the
responsible recycling
of
your old cell phones, MP3 players and tablets. Sell your
phone
or
other device by placing
it
in the ecoA
TM
kiosk, and we'll tell you how much
it's worth. What happens next? You get instant cash. With ecoATM kiosks all over
the country, and with your help, we're working hard
to
solve the eWaste problem
facing our planet.
Support
Customer Service
(http://www.ecoatm.com/customer­
service)
Privacy Policy
(http://www.ecoatm.com/privacy­
policy)
Terms and Conditions
(http://www.ecoatm.com/terms­
and-conditions)
PressRoom
Press Kit
(http://www.ecoatm.com/press­
kit)
Company
About Us
(http://www.ecoatm.com/about­
us)
Charities
(http://www.ecoatm.com/charities)
Careers
(http://outerwaILcom/careers/J
Law Enforcement
(http://www.ecoatm.comltaw­
enforcement)
About Outerwall
(http://www.ecoatm.com/about­
outerwall)
102013
OuterwaLL Inc. (http;/louterwaILcom)AU Rights Reserved. Outerwall and ecoATM and their associated Logos are trademarks ofOuterwalL Inc. or
its
subsidiaries.
http://www.ecoatm.comllaw-enforcement-faq
sl
4/23/2014
 PDF to HTML - Convert PDF files to HTML files
CTJA
The Wireless Association"
Expanding the Wireless Frontier
Smartphone Anti-Theft Voluntary Commitment
Released April 15, 2014
Each device manufacturer and operating system signatory of Part I of this
"Smartphone Anti-Theft Voluntary Commitment" agrees that new models of
smartphones first manufactured after July 2015 for retail sale in the United States will
offer, at no cost to consumers, a baseline anti·theft tool that is preloaded or
downloadable on wireless smartphones that provides the connected capability to:
1. Remote wipe the authorized user's data (i.e., erase personal info that is added
after purchase such as contacts, photos, emails, etc.) that is on the smartphone
in the event
it
is lost or stolen.
2. Render the smartphone inoperable to an unauthorized user (e.g., locking the
smartphone so it cannot be used without a password or PIN), except in
accordance with FCC rules for 911 emergency communications, and if
available, emergency numbers programmed by the authorized user (e.g.,
"phone home").
3. Prevent reactivation without authorized user's permission (including
unauthorized factory reset attempts) to the extent technologically feasible
(e.g., locking the smartphone as in 2 above).
4. Reverse the inoperability if the smartphone is recovered by the authorized
user and restore user data on the smartphone to the extent feasible (e.g.,
restored from the cloud).
In addition to this baseline anti-theft tool, consumers may use other technological
solutions, if available for their smartphones.
Each network operator signatory of Part II to the "Smartphone Anti-Theft Voluntary
Commitment" commits to permit the availability and full usability of a baseline anti­
theft tool to be preloaded or downloadable on smartphones as specified in this
commitment.
###
The following network operators, device manufacturers and operating system
companies are participating in the voluntary commitment: Apple Inc.; Asurion;
AT&T; Google Inc.; HTC America, Inc.; Huawei Device USA; Motorola Mobility
LLC; Microsoft Corporation; Nokia, Inc.; Sam sung Telecommunications America,
L.P.; Sprint Corporation; T-Mobile USA; U.S. Cellular; and Verizon Wireless.
lJMtJ' .':
"
:~
'"
.t,
1400 16th Street, NW
Suite 600
Washington. DC 20036
Main 202,736.3200
www.ctia.org
@