Panel approves new gift-card fraud offenses; adds rule to aggregate values in common schemes

The chair of the committee said the substitution for House Bill 4990 is aimed at protecting West Virginians — particularly the elderly — from "widespread fraud in the gift card industry" and asked counsel to explain the measure.

Counsel told the committee the substitute creates three separate offenses relating to gift cards: a petit larceny provision where a person "with the intent to defraud…acquires or retains possession of a gift card or gift card redemption information without the consent of the cardholder, card issuer, or gift card seller," a tampering offense for altering a card or its packaging, and a false-pretenses offense for devising a scheme to obtain cards or redemption information through fraudulent representations. "Where the value of the gift card or cards is less than 1,000 dollars, the offenses would be misdemeanors, punishable by up to 1 year in jail, or a fine of not more than 1,000 dollars, or both," counsel explained; counsel added that offenses above the $1,000 threshold would be felonies with a stated sentencing range and fines.

Committee members questioned whether the House version’s approach to aggregating values — which tied aggregation to a specific six-month period — conflicted with West Virginia case law. Counsel described the relevant judicial test, noting the court examines factors including the time between takings, location, continuity of conduct and evidence of a unified plan to determine whether separate acts may be aggregated. "That seemed like it could have violated West Virginia law on that, so it was removed," counsel said when explaining the committee substitute’s changes.

To address the issue, the senator from Brooke proposed adding the same aggregation principle into both sections 3 and 4 as a new subsection C: "It shall be permissible to accumulate values where such gift cards were part of a common scheme or plan," the senator said, arguing the language would prevent treating hundreds of related low-value takings as only misdemeanors when they are part of a unified criminal plan.

The committee adopted the senator’s amendment on a voice vote. The vice chair then moved to adopt the strike-and-insert amendment as amended; that motion carried on a voice vote, the bill was reported to the full Senate with a recommendation that it do pass, and the committee adopted a title amendment.

The substitute as amended now proceeds to the full Senate for further consideration.

The committee record shows no fiscal note was available and counsel said stakeholder groups including AARP and the Veil Association were in agreement with the bill language as it came from the House.