Gov. Mary Fallin directed the Oklahoma Department of Public Safety to delay use of recently obtained portable card readers capable of freezing or seizing funds from prepaid debit cards.
In a media release distributed late Friday, Fallin’s office said the governor had directed her cabinet secretary of safety and security to postpone use of the devices until more thorough policies can be developed and more public education undertaken. She did not specify a time frame.
The Oklahoma Highway Patrol has had the Electronic Recovery and Access to Data card readers for about a month. The agency purchased 20 card readers, which are mounted in patrol cruisers, with 16 of those assigned to troopers. After Oklahoma Watch first reported that authorities had the devices, many Oklahomans and out-of-state residents posted on social media or called public officials expressing outrage.
The devices have yet to be used to seize any funds from prepaid cards, according to the Department of Public Safety, but have been used to uncover at least one case of identity theft.
According to ERAD’s patent, the device can “freeze” funds held in pooled accounts and loaded onto prepaid debit cards. The system allows law enforcement to seize prepaid card funds by having the money transferred into a law enforcement account. Both functions can be accomplished from the roadside during traffic stops or at the time of arrest.
The frozen or seized funds are not forfeited to law enforcement until after a court ruling. Under the agreement between the ERAD group and the Department of Public Safety, ERAD would receive 7.7 percent of all forfeited funds seized by using the devices.
The card readers cannot seize funds from checking accounts or credit cards, though in its original solicitation the department sought a device capable of that. The devices can read magnetic stripes from any card, including gift cards and hotel room key cards, and ensure that information on the front of the card matches information on the magnetic stripe.
Secretary of Safety and Security Michael Thompson, who also serves as commissioner of the Department of Public Safety, said increasing use of prepaid cards by criminal groups, including drug and human trafficking organizations, justified use of the ERAD card readers.
Thompson said that before troopers use the readers, they must have reasonable suspicion to believe a crime has occurred. Troopers typically would not use the devices unless a motorist was stopped traveling with dozens of cards, Thompson said.
Some groups and lawmakers have raised concerns that the devices could be misused, pointing to cases in which law enforcement agents have seized cash believed to be associated with the drug trade but was later revealed to belong to innocent people.
Earlier this week, two lawmakers and several liberal and conservative groups sent Fallin a letter asking her to delay use of the devices.
“The Department of Public Safety needs to formulate a clear policy for using this new technology,” said Fallin. “It can be a viable tool for law enforcement only if authorities are able to ensure Oklahoma motorists and others driving through our state that it will be used appropriately.”
The devices were developed in 2012 for use by the U.S. Department of Homeland Security, but have since been adopted by hundreds of law enforcement agencies across the nation, the device’s inventor, T. Jack Williams, told Oklahoma Watch. Law enforcement agencies in more than 25 states use the card-reading devices, according to the Department of Public Safety.
The Department of Public Safety and other advocates of the card readers have said use of the devices had been upheld by appellate courts. But most of the cited rulings dealt with whether law enforcement can, under the Forth Amendment, use card readers to search the magnetic stripe on the back of cards, rather than use ERAD devices to freeze or seize funds without a court order.
“The Oklahoma Highway Patrol has enjoyed the trust of Oklahoma motorists for decades,’’ Fallin said. “Taking time to develop policy for the use of these devices and to educate the public will help calm the fears of the motoring public.”