The Texas Senate Committee on Business and Commerce convened on April 15, 2025, to discuss significant legislative measures aimed at enhancing consumer protection and addressing fraudulent activities in the state’s commercial landscape. Two key bills were the focus of the meeting: Senate Bill 2221, which targets fraudulent filings in the Uniform Commercial Code (UCC), and Senate Bill 1705, which seeks to regulate virtual currency kiosks.

Senate Bill 2221 aims to strengthen protections against fraudulent filings within the UCC financing system. The bill proposes to raise the minimum statutory damages for victims from $5,000 to $10,000 and expands the definition of who can seek restitution to include not just property owners but any individuals or entities harmed by fraudulent filings. It introduces a mechanism allowing victims to file an affidavit of impermissibility with the Secretary of State, enabling a faster administrative process for terminating wrongful filings. The bill also includes due process protections for secured parties to prevent abuse of this process.

Public testimony in support of Senate Bill 2221 highlighted the need for these protections, with witnesses emphasizing the prevalence of fraudulent filings that harass and intimidate individuals. The bill was left pending for further consideration after public testimony concluded.

Senate Bill 1705 addresses the growing concerns surrounding virtual currency kiosks, commonly known as cryptocurrency ATMs. The bill seeks to implement regulatory measures to mitigate risks associated with these kiosks, which have been linked to financial crimes such as fraud and money laundering. Key provisions include requiring operators to obtain licenses, mandating transaction reporting, and implementing fraud prevention mechanisms. The bill also proposes a 72-hour hold on new client transactions to allow law enforcement to investigate potential fraud cases.

Testimony from law enforcement officials underscored the urgency of regulating cryptocurrency kiosks, citing a rise in scams targeting vulnerable populations, particularly the elderly. Experts noted that the anonymous nature of these transactions makes them attractive to criminals. The bill aims to enhance consumer protection while ensuring that legitimate transactions can continue without undue burden.

While there was broad support for the intent of both bills, some concerns were raised regarding specific provisions, such as transaction limits and fee caps in Senate Bill 1705. Stakeholders from the cryptocurrency industry expressed the need for a balance between regulation and operational viability.

The committee's discussions reflect a proactive approach by Texas lawmakers to address emerging challenges in business and commerce, particularly in the realms of fraud prevention and consumer protection. Further deliberations on both bills are expected as the legislative session progresses.