Protection and Welfare Committee

City of Oconomowoc Protection & Welfare Committee Aldermen: Douglas, Chairman / Schellpeper, Secy / Rosek Tuesday, May 02, 2023 - 7:20 PM City Hall - Conference Room 3 174 E. Wisconsin Ave. Oconomowoc, WI 53066 (or immediately following Finance Committee) Notice: If a person with a disability requires that the meeting be accessible or that materials at the meeting be in accessible format, call the City Clerk at least 48 hours prior to the meeting to request adequate accommodations. Tel: (262) 569-2186. 1. Call to order and confirmation of appropriate meeting notification 2. Committee Business a. Consider/recommend Ordinance 23-O1046 to Create §9.32 of the City of Oconomowoc Municipal Code Regarding Third Party Gift Card Procurement 3. Adjourn ________________________________ Diane Coenen, City Clerk City of Oconomowoc Notice is hereby given that a majority of the Common Council will be present at the above scheduled meeting to gather information about a subject over which they have decision-making responsibility. This constitutes a meeting of the Common Council pursuant to State ex rel. Badke v. Greendale Village Board, 173Wis. 2d 553, 494 N.W. 2d 408 (1993) and must be noticed as such, although the Common Council will not take any formal action at this meeting. 1  MEMORANDUM POLICE DEPARTMENT Date: May 2, 2023 To: Mayor Magnus, City Council, and City Administrator From: Jim Pfister, Chief of Police Re: Consider/act on Ordinance 23-O1046 Regarding Fraudulent Purchase of Third-Party Gift Cards RELATES TO THE STRATEGIC PLAN N/A. BACKGROUND The fraudulent purchase of third-party gift cards at retail businesses has become a widespread problem in the City. Criminals often use stolen credit cards to purchase high-dollar, prepaid gift cards before the credit cards are reported stolen. As noted by our Oconomowoc Police Department, stolen credit cards are often obtained during thefts from motor vehicles. These incidents affect numerous victims and require considerable law enforcement resources to investigate. By adopting the provisions of the proposed Ordinance, we can better protect the health, safety, and welfare of all persons living in or visiting the City and those operating businesses. These provisions will work to deter the fraudulent procurement of third- party gift cards at retail establishments. Doing this will reduce the Department’s amount of time, energy, and resources when investigating said behavior. The ordinance aims to deter the fraudulent purchase of third-party gift cards, as it:  Requires a business to verify identification at the point of sale by comparing the identification of the person purchasing the gift card to the name on the credit card.  Prohibits self-checkout purchases of prepaid gift cards without employee assistance.  Targets only Visa, MasterCard, and American Express gift cards that are purchased with a credit card. ADDITIONAL BACKGROUND 9.32 - THIRD PARTY GIFT CARD PROCUREMENT (1) DEFINITIONS As used in this section the following definitions shall apply. Financial Transaction Card. Any instrument or device, whether known as a credit card, credit plate, charge plate, courtesy card, bank services card, banking care, check guarantee card, debit card, electronic benefit system (EBS) card, electronic benefit transfer (EBT) card, assistance transaction card, or by any other name, issued with or without fee by an issuer for the cardholder in obtaining credit, money, goods, services, public assistance benefits, or anything else of value, and includes the account or identification number or symbol of a financial transaction card. 1 2 Third Party Gift Card. A reloadable or non-reloadable prepaid card sold at retail establishments and used to make purchases via either the American Express, MasterCard, or Visa networks, for which the value is decreased upon each purchase. Retail Establishment. A physical place of business in which consumer merchandise is sold to the general public. Person. An individual, partnership, limited partnership, limited liability company, corporation, or other legal entity. Proof Of Identification. A driver’s license, Wisconsin identification card number, or other identification document issued for identification by any state, federal, or foreign government if the document includes the person’s photograph, full name, birth date, and signature. Sell. To transfer to another in exchange for monetary consideration through the use of a financial transaction card. (2) Identification Verification Required. Any person that sells a third-party gift card to an individual on behalf of a retail establishment, including an agent, employee, or other representative of the retail establishment, shall require that the individual purchasing the third-party gift card display proof of identification and shall verify however, proof of identification matches the individual’s form of payment. (3) Self-Checkout. It is unlawful for a retail establishment to allow the purchase of third-party gift cards at self-checkout kiosks where customers themselves scan merchandise and pay without the assistance of an employee of the retail establishment. (4) Enforcement; Violations. Besides any rights or remedies otherwise available to the city in law or in equity, violations of this section shall be subject to the penalty provisions contained in §9.40. FINANCIAL IMPACT These incidents affect numerous victims and require considerable law enforcement resources to investigate. RECOMMENDATION Motion to recommend to the Common Council adoption of Ordinance 23-O1046 regarding third party gift card procurement. SUGGESTED MOTION Motion to adopt Ordinance 23-O1046. 2 3  ORDINANCE NO. 23-O1046 ORDINANCE TO CREATE §9.32 OF THE CITY OF OCONOMOWOC MUNICIPAL CODE REGARDING THIRD PARTY GIFT CARD PROCUREMENT WHEREAS, the fraudulent procurement of third-party gift cards at retail establishments in the City has become a widespread problem affecting numerous victims and requiring considerable law enforcement resources to investigate; and WHEREAS, there has been a substantial increase in the fraudulent procurement of third- party gift cards at retail establishments within the City, often purchased by individuals using cloned or stolen financial transaction cards, counterfeit checks, or through other fraudulent means; and WHEREAS, by adopting these provisions, the City Council desires to protect the health, safety, and welfare of all persons living in the City, visiting the City, and operating businesses within the City by deterring the fraudulent procurement of third-party gift cards at retail establishments and conserving the limited time, energy, and resources available to local law enforcement agencies when investigating said behavior. NOW, THEREFORE, THE COMMON COUNCIL OF THE CITY OF OCONONOMOWOC, WISCONSIN ORDAINS: SECTION 1. Section 9.32 “THIRD PARTY GIFT CARD PROCUREMENT”, of Chapter 9 of the City of Oconomowoc Code of Ordinances, is hereby created as follows: 9.32 - THIRD PARTY GIFT CARD PROCUREMENT (1) DEFINITIONS As used in this section the following definitions shall apply. Financial Transaction Card. Any instrument or device, whether known as a credit card, credit plate, charge plate, courtesy card, bank services card, banking care, check guarantee card, debit card, electronic benefit system (EBS) card, electronic benefit transfer (EBT) card, assistance transaction card, or by any other name, issued with or without fee by an issuer for the cardholder in obtaining credit, money, goods, services, public assistance benefits, or anything else of value, and includes the account or identification number or symbol of a financial transaction card. Third Party Gift Card. A reloadable or non-reloadable prepaid card sold at retail establishments and used to make purchases via either the American Express, MasterCard, or Visa networks, for which the value is decreased upon each purchase. Retail Establishment. A physical place of business in which consumer merchandise is sold to the general public. Person. An individual, partnership, limited partnership, limited liability company, corporation, or other legal entity. Proof Of Identification. A driver’s license, Wisconsin identification card number, or other identification document issued for identification by any state, federal, or foreign government if the document includes the person’s photograph, full name, birth date, and signature. 4 Sell. To transfer to another in exchange for monetary consideration through the use of a financial transaction card. (2) Identification Verification Required. Any person that sells a third-party gift card to an individual on behalf of a retail establishment, including an agent, employee, or other representative of the retail establishment, shall require that the individual purchasing the third-party gift card display proof of identification and shall verify however, proof of identification matches the individual’s form of payment. (3) Self-Checkout. It is unlawful for a retail establishment to allow the purchase of third-party gift cards at self-checkout kiosks where customers themselves scan merchandise and pay without the assistance of an employee of the retail establishment. (4) Enforcement; Violations. Besides any rights or remedies otherwise available to the city in law or in equity, violations of this section shall be subject to the penalty provisions contained in §9.40. SECTION 2. EFFECTIVE DATE. This ordinance shall become effective upon passage and publication as required by law. DATED: ______________________ CITY OF OCONOMOWOC By:_____________________________ Robert P. Magnus, Mayor ATTEST: ________________________________ Diane Coenen, Clerk Adopted: _____________________ Published: ____________________ Effective: _____________________ 5