Minnesota Session Laws
language to be deleted (2) new language
CHAPTER 108--H.F.No. 1758
relating to commerce; regulating access devices; establishing liability for
security breaches; providing enforcement powers; proposing coding for new law
in Minnesota Statutes, chapter 325E.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. [325E.64] ACCESS DEVICES; BREACH OF SECURITY.
Subdivision 1. Definitions. (a) For purposes of this section, the terms defined in this
subdivision have the meanings given them.
(b) "Access device" means a card issued by a financial institution that contains a
magnetic stripe, microprocessor chip, or other means for storage of information which
includes, but is not limited to, a credit card, debit card, or stored value card.
(c) "Breach of the security of the system" has the meaning given in section 325E.61,
subdivision 1, paragraph (d).
(d) "Card security code" means the three-digit or four-digit value printed on an access
device or contained in the microprocessor chip or magnetic stripe of an access device
which is used to validate access device information during the authorization process.
(e) "Financial institution" means any office of a bank, bank and trust, trust company
with banking powers, savings bank, industrial loan company, savings association, credit
union, or regulated lender.
(f) "Microprocessor chip data" means the data contained in the microprocessor
chip of an access device.
(g) "Magnetic stripe data" means the data contained in the magnetic stripe of an
(h) "PIN" means a personal identification code that identifies the cardholder.
(i) "PIN verification code number" means the data used to verify cardholder identity
when a PIN is used in a transaction.
(j) "Service provider" means a person or entity that stores, processes, or transmits
access device data on behalf of another person or entity.
Subd. 2. Security or identification information; retention prohibited. No person
or entity conducting business in Minnesota that accepts an access device in connection
with a transaction shall retain the card security code data, the PIN verification code
number, or the full contents of any track of magnetic stripe data, subsequent to the
authorization of the transaction or in the case of a PIN debit transaction, subsequent
to 48 hours after authorization of the transaction. A person or entity is in violation of
this section if its service provider retains such data subsequent to the authorization of
the transaction or in the case of a PIN debit transaction, subsequent to 48 hours after
authorization of the transaction.
Subd. 3. Liability. Whenever there is a breach of the security of the system of a
person or entity that has violated this section, or that person's or entity's service provider,
that person or entity shall reimburse the financial institution that issued any access devices
affected by the breach for the costs of reasonable actions undertaken by the financial
institution as a result of the breach in order to protect the information of its cardholders
or to continue to provide services to cardholders, including but not limited to, any cost
incurred in connection with:
(1) the cancellation or reissuance of any access device affected by the breach;
(2) the closure of any deposit, transaction, share draft, or other accounts affected
by the breach and any action to stop payments or block transactions with respect to the
(3) the opening or reopening of any deposit, transaction, share draft, or other
accounts affected by the breach;
(4) any refund or credit made to a cardholder to cover the cost of any unauthorized
transaction relating to the breach; and
(5) the notification of cardholders affected by the breach.
The financial institution is also entitled to recover costs for damages paid by the financial
institution to cardholders injured by a breach of the security of the system of a person or
entity that has violated this section. Costs do not include any amounts recovered from
a credit card company by a financial institution. The remedies under this subdivision
are cumulative and do not restrict any other right or remedy otherwise available to the
EFFECTIVE DATES; APPLICATION.Subdivisions 1 and 2 are effective August
1, 2007. Subdivision 3 is effective August 1, 2008, and applies to breaches of the security
of a system occurring on or after that date.
Presented to the governor May 18, 2007
Signed by the governor May 21, 2007, 2:58 p.m.
Copyright © 2007 by the Office of the Revisor of Statutes, State of Minnesota. All rights reserved.