Texas Penal Code 32.34 – Fraudulent Transfer of a Motor Vehicle
(a) In this section:
(1) “Lease” means the grant of use and possession of a motor vehicle for consideration, whether or not the grant includes an option to buy the vehicle.
(2) “Motor vehicle” means a device in, on, or by which a person or property is or may be transported or drawn on a highway, except a device used exclusively on stationary rails or tracks.
(3) “Security interest” means an interest in personal property or fixtures that secures payment or performance of an obligation.
(4) “Third party” means a person other than the actor or the owner of the vehicle.
(5) “Transfer” means to transfer possession, whether or not another right is also transferred, by means of a sale, lease, sublease, lease assignment, or other property transfer.
(b) A person commits an offense if the person acquires, accepts possession of, or exercises control over the motor vehicle of another under a written or oral agreement to arrange for the transfer of the vehicle to a third party and:
(1) knowing the vehicle is subject to a security interest, lease, or lien, the person transfers the vehicle to a third party without first obtaining written authorization from the vehicle’s secured creditor, lessor, or lienholder;
(2) intending to defraud or harm the vehicle’s owner, the person transfers the vehicle to a third party;
(3) intending to defraud or harm the vehicle’s owner, the person disposes of the vehicle in a manner other than by transfer to a third party; or
(4) the person does not disclose the location of the vehicle on the request of the vehicle’s owner, secured creditor, lessor, or lienholder.
Terms Used In Texas Penal Code 32.34
- Actor: means a person whose criminal responsibility is in issue in a criminal action. See Texas Penal Code 1.07
- Another: means a person other than the actor. See Texas Penal Code 1.07
- Contract: A legal written agreement that becomes binding when signed.
- Felony: means an offense so designated by law or punishable by death or confinement in a penitentiary. See Texas Penal Code 1.07
- Harm: means anything reasonably regarded as loss, disadvantage, or injury, including harm to another person in whose welfare the person affected is interested. See Texas Penal Code 1.07
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Lien: A claim against real or personal property in satisfaction of a debt.
- Misdemeanor: means an offense so designated by law or punishable by fine, by confinement in jail, or by both fine and confinement in jail. See Texas Penal Code 1.07
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Owner: means a person who:
(A) has title to the property, possession of the property, whether lawful or not, or a greater right to possession of the property than the actor; or
(B) is a holder in due course of a negotiable instrument. See Texas Penal Code 1.07 - Person: means an individual or a corporation, association, limited liability company, or other entity or organization governed by the Business Organizations Code. See Texas Penal Code 1.07
- Personal property: All property that is not real property.
- Possession: means actual care, custody, control, or management. See Texas Penal Code 1.07
- Property: means real and personal property. See Texas Government Code 311.005
- Written: includes any representation of words, letters, symbols, or figures. See Texas Government Code 311.005
(c) For the purposes of Subsection (b)(2), the actor is presumed to have intended to defraud or harm the motor vehicle’s owner if the actor does not take reasonable steps to determine whether or not the third party is financially able to pay for the vehicle.
(d) It is a defense to prosecution under Subsection (b)(1) that the entire indebtedness secured by or owed under the security interest, lease, or lien is paid or satisfied in full not later than the 30th day after the date that the transfer was made.
(e) It is not a defense to prosecution under Subsection (b)(1) that the motor vehicle’s owner has violated a contract creating a security interest, lease, or lien in the motor vehicle.
(f) An offense under Subsection (b)(1), (b)(2), or (b)(3) is:
(1) a state jail felony if the value of the motor vehicle is less than $30,000;
(2) a felony of the third degree if the value of the motor vehicle is $30,000 or more but less than $150,000;
(3) a felony of the second degree if the value of the motor vehicle is $150,000 or more but less than $300,000; or
(4) a felony of the first degree if the value of the motor vehicle is $300,000 or more.
(g) An offense under Subsection (b)(4) is a Class A misdemeanor.