paper tags

DMV Committee Recommends Fingerprinting Some Dealers to Slow Paper Tag Fraud

Full DMV board, the state legislature may need to approve the advisory committee's recommendation

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Just five weeks after an NBC 5 investigation exposed the scale of the massive fraud and illegal sale of Texas paper license plates, a Texas Department of Motor Vehicles advisory committee is unanimously recommending tougher background checks for small car dealers.

On Thursday, that advisory committee met at DMV headquarters in Austin.

They recommended fingerprinting for all non-franchised car dealers when they apply for a dealer's license.

The committee also recommended limiting the number of paper tags small dealers can print to 900 in a calendar year and requiring the DMV to begin conducting on-site inspections of all new dealers.

That would help stop fraudsters from selling thousands of paper tags using one dealer's license.

This comes just a little more than a month after NBC 5 Investigates exposed major gaps in the DMV’s vetting process.

NBC 5 Investigates obtained DMV records showing how some dealers operating from tiny car lots, and some that seem to exist only on paper, have been printing hundreds of thousands of Texas paper tags.

Real paper tags were created in the DMV’s system but then sold illegally online as law enforcement officials showed us first hand.

After our reporting, the DMV’s executive director declared the situation has become an emergency and asked an advisory committee to look at the issue.

Travis County Constable Detective Mike Bradburn is on that committee and said fingerprinting would be a major victory in the fight against fraud because some of the rogue dealers selling tags are using false identities to get a dealer's license.

“I know we have had meeting after meeting trying to get this fixed. Now I think on the horizon we are going to get it fixed,” said Bradburn.

This is just a first step as the full DMV board will still have to approve this recommendation and then there are legal questions about whether the DMV can collect fingerprints from dealers without additional approval from the state legislature.

DMV legal staff is still trying to determine if the agency needs approval from the legislature before it can fingerprint dealers. If it does, the next legislative session is not until 2023.

In an interview, state Sen. Royce West told NBC 5 Investigates Governor Gregg Abbott should consider bringing the legislature back sooner to deal with the problem.

“You know, we've called special sessions for a lot of what I think is nonsense – this isn't nonsense - maybe the governor needs to call a special session to address this issue”, West said  

Without quicker action, West fears illegally sold tags will be used in more crimes. Police already point to cases of drug smugglers and thieves using bogus paper tags to hide their identities from police.

To combat that, West said the DMV may need additional staff and funding which the legislature would need to provide.

Governor Abbott’s office did not immediately respond to Sen. West's comments.

But a spokesperson for the governor recently told NBC 5 Investigates that Abbott will work with the DMV and the legislature on more changes that might be needed.

Since NBC5’s reports, the chairman of the Texas House Transportation Committee has also pledged to hold hearings on the problem as soon as possible, even before the next session begins.

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