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From the 2005 Regular Session of the Texas Legislature

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	H.B. No. 3376



AN ACT



relating to the prosecution and punishment
of certain criminal offenses involving theft and fraud
and to the provision of notice of the commission of
those offenses to certain licensing entities.


BE IT ENACTED BY THE LEGISLATURE OF THE
STATE OF TEXAS:


SECTION 1.  Sections 34.01(2) and (3), Penal
Code, are amended to read as follows:


(2)  "Funds" includes:


(A)  coin or paper money of the United
States or any other country that is designated as legal
tender and that circulates and is customarily used
and accepted as a medium of exchange in the country
of issue;


(B)  United States silver certificates,
United States Treasury notes, and Federal Reserve System
notes;  and


(C)  an official foreign bank note
notes that is are
customarily used and accepted as a medium of exchange
in a foreign country and a foreign bank draft;
and


(D)  currency or its equivalent, including
an electronic fund, personal check, bank check, traveler's
check, money order, bearer negotiable instrument, bearer
investment security, bearer security, or certificate
of stock in a form that allows title to pass on delivery
drafts.


(3)  "Financial institution" has the
meaning assigned by Section 32.01.  "Peace
officer" means a person who is elected, appointed,
or employed by a governmental entity and who is a peace
officer under Article 2.12, Code of Criminal Procedure,
or other law.


SECTION 2.  Section 34.02, Penal Code, is
amended by amending Subsections (a), (b), and (e) and
adding Subsections (a-1), (f), (g), and (h) to read
as follows:


(a)  A person commits an offense if the
person knowingly:


(1)  acquires or maintains an interest
in, receives, conceals, possesses,
transfers, or transports the proceeds of criminal activity;


(2)  conducts, supervises, or facilitates
a transaction involving the proceeds of criminal activity;
or


(3)  invests, expends, or receives, or
offers to invest, expend, or receive, the proceeds
of criminal activity or funds that the person believes
are the proceeds of criminal activity; or


(4)  finances or invests or intends
to finance or invest funds that the person believes
are intended to further the commission of criminal
activity.


(a-1)  Knowledge of the specific nature
of the criminal activity giving rise to the proceeds
is not required to establish a culpable mental state
under this section.


(b)  For purposes of Subsection
(a)(3) of this section, a person is presumed
to believe that funds are the proceeds of or are
intended to further the commission of criminal
activity if a peace officer or a person acting at the
direction of a peace officer represents to the person
that the funds are proceeds of or are intended to
further the commission of criminal activity, as
applicable, regardless of whether the peace officer
or person acting at the peace officer's direction discloses
the person's status as a peace officer or that the
person is acting at the direction of a peace officer.


(e)  An offense under this section is:


(1)  a state jail felony if the value
of the funds is $1,500 or more but less than $20,000;


(2)  a felony of the third degree
if the value of the funds is $20,000 $3,000
or more but less than $100,000 $20,000;


(3) (2)  a felony
of the second degree if the value of the funds is $100,000
$20,000 or more but less than $200,000
$100,000; or


(4) (3)  a felony
of the first degree if the value of the funds is $200,000
$100,000 or more.


(f)  For purposes of this section, if
proceeds of criminal activity are related to one scheme
or continuing course of conduct, whether from the same
or several sources, the conduct may be considered as
one offense and the value of the proceeds aggregated
in determining the classification of the offense.


(g)  For purposes of this section, funds
on deposit at a branch of a financial institution are
considered the property of that branch and any other
branch of the financial institution.


(h)  If conduct that constitutes an
offense under this section also constitutes an offense
under any other law, the actor may be prosecuted under
this section, the other law, or both.


SECTION 3.  Chapter 34, Penal Code, is amended
by adding Section 34.021 to read as follows:


Sec. 34.021.  PROTECTION FROM CIVIL
LIABILITY.  Notwithstanding Section 1.03(c), a financial
institution or an agent of the financial institution
acting in a manner described by Section 34.02(c) is
not liable for civil damages to a person who:


(1)  claims an ownership interest in
funds involved in an offense under Section 34.02; or


(2)  conducts with the financial institution
or an insurer, as defined by Article 1.02, Insurance
Code, a transaction concerning funds involved in an
offense under Section 34.02.


SECTION 4.  Chapter 35, Penal Code, is amended
by amending Sections 35.01 and 35.02 and adding Sections
35.015 and 35.025 to read as follows:


Sec. 35.01.  DEFINITIONS.  In this chapter:


(1)  "Insurance policy" means a written
instrument in which is provided the terms of any certificate
of insurance, binder of coverage, contract of insurance,
benefit plan, nonprofit hospital service plan, motor
club service plan, surety bond, cash bond, or any other
alternative to insurance authorized by Chapter 601,
Transportation Code.  The term includes any instrument
authorized to be regulated by the Texas Department
of Insurance. "Health care goods" means
a tangible product, device, medicine, or other object
provided in conjunction with a health care service.


(2)  "Health care provider" means
a person who renders health care services or an agent
or employee of an organization that renders or provides
a facility and means to render health care services.
 The term includes a physician, surgeon, person who
may be selected by an insured or a beneficiary under
Article 21.52, Insurance Code, and person defined as
a provider of health care under Section 152.003, Occupations
Code.


(3)  "Health care service" means
a service that is intended to improve or maintain the
physical or mental condition of an individual and that
is rendered, directed, or supervised by a health care
provider.


(4)  "Insurer" has
the meaning assigned by Article 1.02, Insurance Code
means a person who engages in the business
of insurance in this state, including:


(A)  an insurer that is not authorized
to do business in this state;


(B)  a health maintenance organization;


(C)  a group hospital service
corporation regulated under Chapter 842, Insurance
Code; and


(D)  any person who self-insures
and provides health care benefits to the person's employees.


(3) (5)  "Statement"
means an oral or written communication or a record
or documented representation of fact made to an
insurer evidencing a loss, injury, or
expense.  The term includes computer-generated
information.


(4)  "Value of the claim" means the
total dollar amount of a claim for payment under an
insurance policy or, as applicable, the value of the
claim determined under Section 35.025.


Sec. 35.015.  MATERIALITY.  A statement
is material for the purposes of this chapter, regardless
of the admissibility of the statement at trial, if
the statement could have affected:


(1)  the eligibility for coverage or
amount of the payment on a claim for payment under
an insurance policy; or


(2)  the decision of an insurer whether
to issue an insurance policy.


Sec. 35.02.  INSURANCE FRAUD.  (a)  A person
commits an offense if, with intent to defraud or deceive
an insurer, the person, in support of a claim for
payment under an insurance policy:


(1)  prepares or causes to be prepared
or presents to an insurer in support of a
claim for payment under a health or property and casualty
insurance policy a statement that:


(A)  the person knows contains false
or misleading material information; and


(B)  is presented to an insurer; or


(2)  presents or causes to be presented
to an insurer a statement that the person knows contains
false or misleading material information concerning
a matter that is material to the claim, and the matter
affects a person's right to a payment or the amount
of payment to which a person is entitled.


(a-1)  A person commits an offense if
the person, with intent to defraud or deceive an insurer
and in support of an application for an insurance policy:


(1)  prepares or causes to be prepared
a statement that:


(A)  the person knows contains false
or misleading material information; and


(B)  is presented to an insurer; or


(2)   presents or causes to be presented
to an insurer a statement that the person knows contains
false or misleading material information.


(b)  A person commits an offense if, with
intent to defraud or deceive an insurer, the person
solicits, offers, pays, or receives a benefit in connection
with the furnishing of health care
goods or services for which a claim for payment is
submitted under an a health or property
and casualty insurance policy.


(c)  For purposes of Subsection
(a), information concerning a matter that is material
to a claim for payment under an insurance policy includes
information concerning:


(1)  whether health care goods
or services were provided;


(2)  whether health care goods
or services were medically necessary under professionally
accepted standards;


(3)  the nature of the health
care goods or services provided;


(4)  the date on which health
care goods or services were provided;


(5)  the medical record of goods
or services provided;


(6)  the condition treated or
diagnosis made;


(7)  the identity and applicable
license of the provider or the recipient of health
care goods or services;


(8)  whether property was damaged
or lost in the manner and under the circumstances described
in a statement related to a claim for insurance payment;
 or


(9)  whether any other claim for
insurance payment has been communicated to any other
insurer concerning property damage or loss to the same
property.


(d)  An offense under
Subsection (a) or (b) this section
is:


(1)  a Class C misdemeanor if the value
of the claim is less than $50 $20;


(2)  a Class B misdemeanor if the value
of the claim is $50 $20 or
more but less than $500;


(3)  a Class A misdemeanor if the value
of the claim is $500 or more but less than $1,500;


(4)  a state jail felony if the value of
the claim is $1,500 or more but less than $20,000;


(5)  a felony of the third degree if the
value of the claim is $20,000 or more but less than
$100,000;


(6)  a felony of the second degree if the
value of the claim is $100,000 or more but less than
$200,000; or


(7)  a felony of the first degree if:


(A)  the value of the claim is $200,000
or more; or


(B)  an act committed in connection
with the value of the claim is less than
$200,000 and the commission of the offense
places placed a person at
risk of death or serious bodily injury.


(d)  An offense under Subsection (a-1)
is a state jail felony.


(e)  The court shall order a defendant
convicted of an offense under this section to pay restitution,
including court costs and attorney's fees, to an affected
insurer.


(f)  If conduct that constitutes an
offense under this section also constitutes an offense
under any other law, the actor may be prosecuted under
this section, the other law, or both.


(g)  For purposes of this section, if
the actor proves by a preponderance of the evidence
that a portion of the claim for payment under an insurance
policy resulted from a valid loss, injury, expense,
or service covered by the policy, the value of the
claim is equal to the difference between the total
claim amount and the amount of the valid portion of
the claim.


(h)  If it is shown on the trial of
an offense under this section that the actor submitted
a bill for goods or services in support of a claim
for payment under an insurance policy to the insurer
issuing the policy, a rebuttable presumption exists
that the actor caused the claim for payment to be prepared
or presented.


Sec. 35.025.  VALUE OF CLAIM.  (a) 
Except as provided by Subsection (b) and subject to
Subsection (c), for the purposes of Section 35.02(c),
if the value of a claim is not readily ascertainable,
the value of the claim is:


(1)  the fair market value, at the time
and place of the offense, of the goods or services
that are the subject of the claim; or


(2)  the cost of replacing the goods
or services that are the subject of the claim within
a reasonable time after the claim.


(b)  If goods or services that are the
subject of a claim cannot be reasonably ascertained
under Subsection (a), the goods or services are considered
to have a value of $500 or more but less than $1,500.


(c)  If the actor proves by a preponderance
of the evidence that a portion of the claim for payment
under an insurance policy resulted from a valid loss,
injury, expense, or service covered by the policy,
the value of the claim is equal to the difference between
the total claim amount and the amount of the valid
portion of the claim.


SECTION 5.  Section 71.02(a), Penal Code,
is amended to read as follows:


(a)  A person commits an offense if, with
the intent to establish, maintain, or participate in
a combination or in the profits of a combination or
as a member of a criminal street gang, he commits or
conspires to commit one or more of the following:


(1)  murder, capital murder, arson, aggravated
robbery, robbery, burglary, theft, aggravated kidnapping,
kidnapping, aggravated assault, aggravated sexual assault,
sexual assault, forgery, deadly conduct, assault punishable
as a Class A misdemeanor, burglary of a motor vehicle,
or unauthorized use of a motor vehicle;


(2)  any gambling offense punishable as
a Class A misdemeanor;


(3)  promotion of prostitution, aggravated
promotion of prostitution, or compelling prostitution;


(4)  unlawful manufacture, transportation,
repair, or sale of firearms or prohibited weapons;


(5)  unlawful manufacture, delivery, dispensation,
or distribution of a controlled substance or dangerous
drug, or unlawful possession of a controlled substance
or dangerous drug through forgery, fraud, misrepresentation,
or deception;


(6)  any unlawful wholesale promotion or
possession of any obscene material or obscene device
with the intent to wholesale promote the same;


(7)  any offense under Subchapter B, Chapter
43, depicting or involving conduct by or directed toward
a child younger than 18 years of age;


(8)  any felony offense under Chapter 32;


(9)  any offense under Chapter 36;


(10)  any offense under Chapter 34 or
35;


(11)  any offense under Section 37.11(a);
or


(12)  any offense under Chapter 20A.


SECTION 6.  Article 12.01, Code of Criminal
Procedure, is amended to read as follows:


Art. 12.01.  FELONIES.  Except as provided
in Article 12.03, felony indictments may be presented
within these limits, and not afterward:


(1)  no limitation:


(A)  murder and manslaughter;


(B)  sexual assault, if during the investigation
of the offense biological matter is collected and subjected
to forensic DNA testing and the testing results show
that the matter does not match the victim or any other
person whose identity is readily ascertained; or


(C)  an offense involving leaving the scene
of an accident under Section 550.021, Transportation
Code, if the accident resulted in the death of a person;


(2)  ten years from the date of the commission
of the offense:


(A)  theft of any estate, real, personal
or mixed, by an executor, administrator, guardian or
trustee, with intent to defraud any creditor, heir,
legatee, ward, distributee, beneficiary or settlor
of a trust interested in such estate;


(B)  theft by a public servant of government
property over which he exercises control in his official
capacity;


(C)  forgery or the uttering, using or
passing of forged instruments;


(D)  injury to a child, elderly individual,
or disabled individual punishable as a felony of the
first degree under Section 22.04, Penal Code;


(E)  sexual assault, except as provided
by Subdivision (1) or (5); or


(F)  arson;


(3)  seven years from the date of the commission
of the offense:


(A)  misapplication of fiduciary property
or property of a financial institution;


(B)  securing execution of document by
deception;  or


(C)  a violation under Sections 162.403(22)-(39)
153.403(22)-(39), Tax Code;


(4)  five years from the date of the commission
of the offense:


(A)  theft, burglary, robbery;


(B)  kidnapping;


(C)  injury to a child, elderly individual,
or disabled individual that is not punishable as a
felony of the first degree under Section 22.04, Penal
Code;  or


(D)  abandoning or endangering a child;
or


(E)  insurance fraud;


(5)  ten years from the 18th birthday of
the victim of the offense:


(A)  indecency with a child under Section
21.11(a)(1) or (2), Penal Code;  or


(B)  except as provided by Subdivision
(1), sexual assault under Section 22.011(a)(2), Penal
Code, or aggravated sexual assault under Section 22.021(a)(1)(B),
Penal Code; or


(6)  three years from the date of the commission
of the offense:  all other felonies.


SECTION 7.  Chapter 42, Code of Criminal
Procedure, is amended by adding Article 42.0181 to
read as follows:


Art. 42.0181.  NOTICE OF THEFT, FRAUD,
MONEY LAUNDERING, OR INSURANCE FRAUD PROVIDED BY CLERK
OF COURT.  Not later than the fifth day after the date
a person who holds a certificate of authority, license,
or other authority issued by the Texas Department of
Insurance is convicted of or granted deferred adjudication
for an offense under Chapter 31, 32, 34, or 35, Penal
Code, the clerk of the court in which the conviction
or order of deferred adjudication is entered shall
provide to the Texas Department of Insurance written
notice of the person's conviction or deferred adjudication,
including the offense on which the conviction or deferred
adjudication was based.


SECTION 8.  (a)  The changes in law made
by this Act to Chapters 34, 35, and 71, Penal Code,
apply only to an offense committed on or after the
effective date of this Act.  An offense committed before
the effective date of this Act is covered by the law
in effect at the time the offense was committed, and
the former law is continued in effect for that purpose.
 For purposes of this section, an offense was committed
before the effective date of this Act if any element
of the offense was committed before that date.


(b)  The change in law made by Article
12.01, Code of Criminal Procedure, as amended by this
Act, does not apply to an offense if the prosecution
of that offense became barred by limitation before
the effective date of this Act.  The prosecution of
that offense remains barred as if this Act had not
taken effect.


SECTION 9.  This Act takes effect September
1, 2005.




______________________________	______________________________


   President of the Senate	Speaker of the
House      


I certify that H.B. No. 3376 was passed
by the House on May 10, 2005, by a non-record vote;
and that the House adopted H.C.R. No. 235 authorizing
certain corrections in H.B. No. 3376 on May 30, 2005,
by a non-record vote.



______________________________




Chief Clerk of the
House   



I certify that H.B. No. 3376 was passed
by the Senate on May 25, 2005, by the following vote:
 Yeas 31, Nays 0; and that the Senate adopted H.C.R.
No. 235 authorizing certain corrections in H.B. No.
3376 on May 30, 2005, by a viva-voce vote.



______________________________




Secretary of the Senate
   



APPROVED:  _____________________


                    Date          


           _____________________


                  Governor