Texas Lawmakers to Hold Paper Tag Hearings

On Tuesday, Texas lawmakers kick off a series of hearings aimed at stopping fraudsters from selling Texas temporary license plates.

The House Transportation Committee will tackle the issue first, with the Senate Criminal Justice Committee expected to hold additional hearings in the coming weeks.

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On the eve of the first hearing, State Sen. Paul Bettencourt (R-Houston), told NBC 5 Investigates he wants the state to get rid of paper tags altogether because he believes the current problems cannot be fixed unless Texas eliminates the current tags, which have become a nationwide headache for police and a danger to the public.

First, crooks exploited security loopholes at the Texas Department of Motor Vehicles. They got car dealer licensees, accessed the state’s eTAG system, and sold hundreds of thousands of temporary paper tags for profit.

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Those temporary tags are then often slapped onto cars later used to commit other serious crimes nationwide.

NBC 5 Investigates has documented how so-called "ghost cars" with illegal paper tags have been used by drug runners, human smugglers and suspects involved in violent crimes, including drive-by shootings.

“DMV, quite frankly, sat on their rear end. It did nothing about the problem. And they could have done more faster, quicker and earlier to stop this problem,” Bettencourt told NBC 5 Investigates.

Bettencourt believes the Texas DMV is at least on the right track now since the agency's former director has resigned and the TxDMV has launched new efforts to shut down small dealers selling tags.

The board that oversees the TxDMV is also looking at ways to close loopholes in the background check process that allow bad actors to become licensed car dealers.

“The only thing that's driving through these loopholes are Mack trucks of money for organized crime, and that's why it's got to be stopped now,” Bettencourt said.

As the TxDMV adapts, police warn the bad guys are adapting, too.

Using templates from old paper tags, authorities say crooks are simply counterfeiting new tags, like one spotted Monday by NBC 5 Investigates in Dallas.

NBC 5 Investigates

The 60-day buyer's tag says it was issued by “MIR Motors” and shows a May expiration date, indicating the tag was issued in March. But TxDMV records show the agency revoked MIR Motors dealer license for suspected tag fraud in January, so it could not have issued tags in March.

NBC 5 Investigates continues to see counterfeit tags with the name of that revoked dealer on Dallas streets.

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Bettencourt believes the current tags are too easy to reproduce and must be replaced with something more secure.

“We need to get out of the paper tag business because now, even if we close these dealers, a lot of these dealers are just inventing numbers and putting out false numbers,” Bettencourt told NBC 5 Investigates.

At Tuesday’s House Transportation Committee hearing, law enforcement officials are expected to testify about other tools they need to investigate the tag sellers.

And one mom will be there to support them.

“I wish they would have all listened to law enforcement - a long time ago, years ago, and they wouldn't be in this situation,” said Tawny Solbrig.

Solbrig’s son, Terrin, died in a crash involving a car with an illegal paper tag.

Tawny Solbrig wants the legislature to reinstate funding for special police units that used to investigate paper tag fraud in cities like Dallas.

“We need to be able to get the tools to the law enforcement to do their job,” said Solbrig.

Funding for those dedicated enforcement units was cut in 2017 when Gov. Greg Abbott (R) vetoed a bill that contained that funding. At the time, Abbott indicated he was opposed to a separate clean air program provision in that bill.

In addition to resources for task forces to police tag fraud, law enforcement officials are expected to ask lawmakers for a long list of items including tougher penalties for people who sell counterfeit tags, additional funding for the DMV to hire more inspectors to check small dealers, resources for tougher background checks on dealer applicants and better police access to DMV data to investigate crimes.

The House and Senate are holding hearings under “interim charges” from the House Speaker and lieutenant governor, but legislation to deal with the paper tag problem cannot be introduced until the legislature is back in session in 2023.