DE2 includes statutory transfer of Commerce fraud investigators to BCA, creates financial-crimes section

House counsel and staff told the committee Article 3 of the DE2 amendment contains conforming and substantive statutory changes related to transferring fraud investigators from the Department of Commerce to the Bureau of Criminal Apprehension (BCA).

Staff said the administrative transfer of investigators already occurred in February under an administrative authority (cited in testimony as section 16B.37). Article 3 includes two highlighted statutory provisions: one requiring the BCA to investigate criminal insurance fraud and imposing a reporting duty on the commissioner of commerce for crimes identified in civil regulatory work, and another that formally establishes a financial crimes and fraud section within the BCA. That section is described in the amendment as having specific duties, mandatory referral responsibilities, authority for certain data-sharing between agencies to facilitate reporting of suspected fraud, and a requirement that funds from the existing insurance-policy assessment be used only for insurance-fraud investigations and related crimes.

Mr. Johnson, who reviewed Article 3, told the committee the statutory language also requires an annual report to the legislature on the new section—s work. He described the provisions as largely conforming changes related to the transfer that nonetheless contain operational requirements and reporting obligations that will govern the BCA—s new financial-crimes activities going forward.

No vote on the statutory language occurred during the hearing; staff said members would have further opportunities to debate and amend the language when the committee reconvenes to take votes on the DE2.