BILL ANALYSIS SENATE COMMITTEE ON PUBLIC SAFETY Senator Mark Leno, Chair A 2009-2010 Regular Session B 8 1 1 AB 811 (John Perez) As Amended June 16, 2009 Hearing date: July 14, 2009 Civil Code; Vehicle Code JM:mc CHECK CASHING BUSINESS: IDENTIFICATION CARDS AND RELATED DOCUMENTS HISTORY Source: Author Prior Legislation: AB 971 (Correa) - Ch. 17, Stats. 2004 AB 711 (Ackerman) - Ch. 369. Stats. 1997 SB 1959 (Calderon) - Ch. 682, Stats. 1996 AB 465 (Peace) - Ch. 327, Stats 1993 AB 2400 (Peace) - Ch. 1043, Stats. 1992 Support: California Immigrant Policy Center; Consumer Federation of California Opposition:None known Assembly Floor Vote: Ayes 79 - Noes 0 KEY ISSUES SHOULD A "CHECK CASHER" BE PROHIBITED FROM REQUIRING A PERSON TO USE AN IDENTIFICATION CARD ISSUED BY THE CHECK CASHER? (More) AB 811 (John Perez) PageB (CONTINUED) SHOULD A CHECK CASHER BE PROHIBITED FROM SELLING ANY FORM OF IDENTIFICATION OTHER THAN AN IDENTIFICATION CARD FOR USE ONLY AT THAT PARTICULAR BUSINESS? SHOULD THE PENALTY FOR MAKING A FALSE IDENTIFICATION THAT MIMICS AN IDENTIFICATION ISSUED BY THE DEPARTMENT OF MOTOR VEHICLES (DMV) BE INCREASED TO INCLUDE A JAIL TERM OF UP TO ONE YEAR, IN ADDITION TO A MANDATORY FINE OF $1,000 AND MANDATORY COMMUNITY SERVICE OF AT LEAST 24 HOURS' TIME? PURPOSE The purposes of this bill are to 1) prohibit a "check casher" from requiring a customer to use an identification card issued by the check casher; 2) prohibit a check casher from selling any form of identification other than a card for use only at that business; and 3) provide that the penalties for making a false DMV-style identification card, may include a jail term of up to one year. Check Cashing Businesses Existing law defines a "check casher" as a person or entity that for compensation engages, in whole or in part, in the business of cashing checks, warrants, drafts, money orders, or other commercial paper serving the same purpose. "Check casher" does not include a state or federally chartered bank, savings association, credit union, or industrial loan company. (Civ. Code 1789.31.) Existing law requires check cashers to obtain a permit from the Department of Justice (DOJ). (Civ. Code 1789.37.) Existing law allows a check casher to charge a fee of no more (More) AB 811 (John Perez) PageC than $10 to set up an initial account and issue an optional identification card for providing check cashing services. A replacement identification card may be issued at a cost not to exceed $5. (Civ. Code 1789.35(b).) This bill prohibits a check casher from requiring a customer to purchase a check cashing identification card to access services. This bill prohibits check cashers from selling any other form of identification other than what is permitted to access check cashing services. False Identification and Related Matters Existing law provides that any person who falsely personates another person in his or her private or official capacity is guilty of an alternate felony-misdemeanor. False personation generally involves subjecting the person whose identity was assumed to prosecution, suit or to pay a debt. (Pen. Code 529.) Existing law provides that it is an alternative felony-misdemeanor for a person to willfully obtain the personal identifying information of another person and to use such information to obtain, or attempt to obtain, credit, goods, or services in the name of the other person without consent. (Pen. Code 530.5, subd. (a).) Existing law defines "personal identifying information" to mean name, address, mother's maiden name, place of employment, date of birth, unique biometric data including fingerprint, facial scan identifiers, voiceprint, retina or iris image, or other unique physical representation, unique electronic data including information identification number assigned to the person, address or routing code, telecommunication identifying information or access device, information contained in a birth or death certificate, following identifying numbers: telephone, health insurance, credit card, taxpayer identification, school (More) AB 811 (John Perez) PageD identification, state or federal driver's license, state or federal identification number, social security, employee identification number, professional or occupational, demand deposit account, savings account, checking account, PIN or password, alien registration, government passport, or any form of identification that is equivalent to those listed above. (Pen. Code 530.55.) Existing law provides that every person who, with the intent to defraud, acquires or retains possession of the personal identifying information of another person, and who has previously been convicted of a violation of provisions proscribing identity theft, or who, with the intent to defraud, acquires or retains possession of the personal identifying information of 10 or more other persons, shall be punished by a fine, by imprisonment in a county jail not to exceed one year, or by both a fine and imprisonment, or by imprisonment in the state prison. (Pen. Code 530.5, subd. (b)(3).) Existing law provides that any person who, with intent to defraud, sells, transfers, or conveys the personal identifying information of another person shall be punished by a fine, by imprisonment in a county jail not to exceed one year, or by both a fine and imprisonment, or by imprisonment in the state prison. Further, any person who, with actual knowledge that the personal identifying information of a specific person will be used in violation of identity theft provisions who sells, transfers, or conveys that personal identifying information shall be punished by a fine or by both a fine and imprisonment, or by imprisonment in the state prison. (Pen. Code 530.5, subd. (d).) Existing law prohibits any person from manufacturing or selling an identification document of a size and form substantially similar to the identification cards or drivers' licenses issued by the Department of Motor Vehicles. A violation of these provisions is a misdemeanor, punishable by a fine of $1,000, "no part of which shall be suspended." The convicted person "shall [also] be required to perform not less than 24 hours of (More) AB 811 (John Perez) PageE community service during hours when the person is not employed and is not attending school." (Veh. Code 13004.1 and 14610.1.) This bill enhances penalties for making false DMV-style identification cards (in the form of a DMV identification card or driver's license) to include a jail term of up to one year, in addition to the mandatory penalties in current law of a $1,000 fine and 24 hours of community service. The bill specifies that no part of the community service may be suspended or waived. RECEIVERSHIP/OVERCROWDING CRISIS AGGRAVATION California continues to face a severe prison overcrowding crisis. The Department of Corrections and Rehabilitation (CDCR) currently has about 170,000 inmates under its jurisdiction. Due to a lack of traditional housing space available, the department houses roughly 15,000 inmates in gyms and dayrooms. California's prison population has increased by 125% (an average of 4% annually) over the past 20 years, growing from 76,000 inmates to 171,000 inmates, far outpacing the state's population growth rate for the age cohort with the highest risk of incarceration.<1> In December of 2006 plaintiffs in two federal lawsuits against CDCR sought a court-ordered limit on the prison population pursuant to the federal Prison Litigation Reform Act. On February 9, 2009, the three-judge federal court panel issued a tentative ruling that included the following conclusions with respect to overcrowding: No party contests that California's prisons are ---------------------- <1> "Between 1987 and 2007, California's population of ages 15 through 44 - the age cohort with the highest risk for incarceration - grew by an average of less than 1% annually, which is a pace much slower than the growth in prison admissions." (2009-2010 Budget Analysis Series, Judicial and Criminal Justice, Legislative Analyst's Office (January 30, 2009).) (More) AB 811 (John Perez) PageF overcrowded, however measured, and whether considered in comparison to prisons in other states or jails within this state. There are simply too many prisoners for the existing capacity. The Governor, the principal defendant, declared a state of emergency in 2006 because of the "severe overcrowding" in California's prisons, which has caused "substantial risk to the health and safety of the men and women who work inside these prisons and the inmates housed in them." . . . A state appellate court upheld the Governor's proclamation, holding that the evidence supported the existence of conditions of "extreme peril to the safety of persons and property." (citation omitted) The Governor's declaration of the state of emergency remains in effect to this day. . . . the evidence is compelling that there is no relief other than a prisoner release order that will remedy the unconstitutional prison conditions. . . . Although the evidence may be less than perfectly clear, it appears to the Court that in order to alleviate the constitutional violations California's inmate population must be reduced to at most 120% to 145% of design capacity, with some institutions or clinical programs at or below 100%. We caution the parties, however, that these are not firm figures and that the Court reserves the right - until its final ruling - to determine that a higher or lower figure is appropriate in general or in particular types of facilities. . . . Under the PLRA, any prisoner release order that we issue will be narrowly drawn, extend no further than necessary to correct the violation of constitutional rights, and be the least intrusive means necessary to (More) AB 811 (John Perez) PageG correct the violation of those rights. For this reason, it is our present intention to adopt an order requiring the State to develop a plan to reduce the prison population to 120% or 145% of the prison's design capacity (or somewhere in between) within a period of two or three years.<2> The final outcome of the panel's tentative decision, as well as any appeal that may be in response to the panel's final decision, is unknown at the time of this writing. This bill does not appear to aggravate the prison overcrowding crisis outlined above. COMMENTS 1. Need for This Bill According to the author's office: Check cashers regularly sell identification cards so that customers may be able to access services. This practice is necessary if a customer has no other form of identification, but some check cashing facilities do coerce or compel people into purchasing identification cards. These check cashing facilities target non-English proficient people and advertise the sale of identification cards to this vulnerable population. There are even cases where they advertise the sale of identification that they claim is a valid California Identification Card or California Drivers License. Since these facilities target non-English proficient people, the consumers are misled into ---------------------- <2> Three Judge Court Tentative Ruling, Coleman v. Schwarzenegger, Plata v. Schwarzenegger, in the United States District Courts for the Eastern District of California and the Northern District of California United States District Court composed of three judges pursuant to Section 2284, Title 28 United States Code (Feb. 9, 2009). (More) AB 811 (John Perez) PageH purchasing fraudulent identification. This bill removes any ambiguity in law by not permitting check cashers to sell anything other than an optional identification card intended to access service. 2. Previous Legislation in 2007 Increased Fines for Manufacturing or Selling False Identification Cards that are Similar to DMV Identification Cards and Driver's Licenses. AB 1658 (Sharon Runner) Chapter 743, Statutes of 2007, increased the mandatory fine for manufacturing false identification and licenses from $500 to $1,000. The bill also required a convicted defendant to perform 24 hours of community service while the violator is not employed or attending school. 3. Background on Regulation of Check Cashing Businesses California established the Check Casher Permit Program in 1995. Check cashers are regulated by the Department of Justice (DOJ). Check cashers, for a fee, cash checks, warrants, money orders or similar commercial paper. The owner of a check cashing business must obtain a permit from the DOJ. A check cashing business must post for clear public viewing a complete, detailed and unambiguous schedule of all fees for cashing checks, drafts, money orders or other commercial paper and for the initial issuance of any identification card. Customers must also be able to clearly view a posted list of valid identification that is acceptable in lieu of identification issued by the check casher. The check casher law does not apply to state and federally chartered banks, savings associations, credit unions and industrial loan companies. Also excluded are retail stores that may incidentally charge a fee not exceeding $2 to cash checks or money orders as a service to customers. Many customers of check cashing businesses do not have bank accounts or drivers' licenses. To address this situation, check cashers may distribute identification cards to customers. An identification check casher includes a photograph, name, address, sex, hair, eye color, height, weight, date of birth, date issued, signature and right thumbprint. The addition of a (More) AB 811 (John Perez) PageI social security number is optional. It appears that one of the concerns presented or addressed by this bill is that check cashers could issue identification cards that recipients could attempt to use for a variety of purposes, unrelated to cashing checks or at the check cashing business. The bill is drafted in terms of selling identification cards other than cards for use at the check cashing business. If the author's intent is to prevent the use of check casher identification cards for purposes other than for cashing checks, the bill should also prohibit a check casher from "providing" such forms of identification. SHOULD THE BILL STATE THAT A CHECK CASHER SHALL NOT SELL OR PROVIDE ANY IDENTIFICATION CARD OTHER THAN IDENTIFICATION TO BE USED AT THAT PARTICULAR BUSINESS? 4. Court Discretion to Sentence a Defendant Convicted of Making or Selling a False DMV-Style Identification to up to a Year in Jail, in Addition to Mandatory Community Service and a Full and Mandatory $1,000 Fine The New Penalty Provision in the Bill Existing law requires a court to order a defendant to perform at least 24 hours of community service and to pay a full and mandatory fine of $1,000 for making a DMV-style false identification. This bill, in what is perhaps a redundant provision, specifies that the court cannot stay any part of the community service order. This bill also allows the court to impose a jail term of up to one year, in addition to the community service order. (More) Community Service Generally Allowing a court to impose a jail term in addition to community service appears to be a novel penalty for a misdemeanor. Typically, community service is ordered as an alternative to a jail term. Community service is generally considered to be a rehabilitative and restorative program. For example, an underage person who purchased alcohol, or a person who provided alcohol to an underage person, shall be ordered to perform community service. This community service should be served in an alcohol or drug treatment program or the coroner's office. (Bus. & Prof. Code 25658, subd. (e)(1).) Clearly, such service is designed to teach a defendant about the very serious dangers of alcohol use, including addiction and fatalities. The court can only impose a jail term on a defendant if he or she provided alcohol to an underage person and the underage person seriously injured or killed another person or the underage person. The jail penalty provision does not include a community service option for the court. (Bus. & Prof. Code 25658, subd. (e)(3).) The restitution provisions in Penal Code Section 1202.4 direct a court to consider a community service order in an extraodinary case where the defendant cannot afford to pay restitution. The court, in granting probation to a minor who possessed etching cream for the purpose of committing vandalism shall consider a community service order as a condition of probation. (Pen. Code 594.1, subd. (e).) A minor who purchases or possesses tobacco shall be ordered to pay a fine of $75 or perform 30 hours of community service. (Pen. Code 308l, subd. (b).) On the other hand, the sentencing court may order a grafitti defeNdant to serve a jail term and to perform community service, buT only if it is not feasible for the defendant to clean up the graffiti. (Pen. Code 594, subd. (c).) Suggestion to Include a Jail Term in a Series of Graduated Sanctions Perhaps the bill should describe or prescribe graduated (More) AB 811 (John Perez) PageK sanctions, depending on the seriousness of the crime and other relevant factors. 1) The court could order a defendant to pay the mandatory fine and perform the community service, with no other penalty. 2) The court could place the defendant on probation, and order the defendant to pay the fine and perform community service as a condition of probation. 3) If the defendant fails to perform satisfactorily on probation, the court may order additional community service, or impose a jail term. IN A CONVICTION FOR MAKING OR SELLING A FALSE DMV IDENTIFICATION OR LICENSE, SHOULD THE APPLICABLE PENALTIES INCLUDE A COMBINATION OF MANDATORY COMMUNITY SERVICE, A MANDATORY $1,000 FINE AND A JAIL TERM? SHOULD THE BILL PROVIDE THAT A JAIL TERM COULD BE IMPOSED IN LIEU OF COMMUNITY SERVICE, PARTICULARLY WHERE THE DEFENDANT FAILED TO PERFORM COMMUNITY SERVICE AS A CONDITION OF PROBATION? 5. Identity Theft Issues as Concerns False DMV-Style Identification Documents Sections 3 and 4 of this bill increase the penalties for the misdemeanor of making or selling a false identification document that is in the form of a DMV identification card or driver's license. Existing law also includes crimes for possessing or transferring the personal identifying information of another with intent to defraud or with actual knowledge that the information would be used to commit identity theft. Identity theft crimes can be committed through the use of false DMV-style identification cards or documents. While the identity theft crimes include an intent or knowledge element not included in the false DMV document crime amended by this bill, a defendant could argue that he or she can only be prosecuted for the false DMV document offense if the card contains or reflects the personal identifying information of another. Such an argument would be made under the legal principle that when a general statute and a specific statute cover the same conduct, the more specific statute controls. (1 Witkin & Epstein (3d Ed. AB 811 (John Perez) PageL 2000) Intro. to Crimes, 59-61.) It is thus suggested that the bill be amended to include a provision that a person can be prosecuted under the false DMV document statute or any other provision of law. SHOULD THE BILL INCLUDE A PROVISION THAT A DEFENDANT WHO VIOLATES THE PROHIBITION ON MAKING OR SELLING A DMV-STYLE IDENTIFICATION OR DRIVER'S LICENSE MAY BE PROSECUTED UNDER ANY OTHER PROVISION OF LAW? ***************