(a) In this section "fraudulently obtained temporary tags from the temporary tag database" means misuse by a dealer or converter account user of the temporary tag database authorized under Transportation Code, §503.0626 or §503.0631 to obtain:
  (1) an excessive number of temporary tags relative to dealer sales;
  (2) temporary tags for a vehicle or vehicles not in the dealer's or converter's inventory (a vehicle is presumed not to be in the dealer's or converter's inventory if the vehicle is not listed in the relevant monthly Vehicle Inventory Tax Statement);
  (3) access to the temporary tag database for a fictitious user or person using a false identity;
  (4) temporary tags for a vehicle or a motor vehicle when a dealer is no longer operating at a licensed location; or
  (5) temporary tags issued for a vehicle or a motor vehicle not located at a licensed location or a storage lot.
(b) The department shall deny a dealer or converter access to the temporary tag database effective on the date the department sends notice electronically and by certified mail to the dealer or converter that the department has determined, directly or through an account user, that the dealer or converter has fraudulently obtained temporary tags from the temporary tag database. A dealer or converter may seek a negotiated resolution with the department by demonstrating the dealer or converter took corrective action or that the department's determination was incorrect.
(c) Notice shall be sent to the dealer's or converter's last known mailing address and last known email in the department-designated licensing system.
(d) A dealer or converter may request a hearing on the denial of access to the temporary tag database, as provided by Subchapter O, Chapter 2301, Occupations Code. The request must be in writing and the dealer or converter must request a hearing under this section. The department must receive the written request for a hearing within 26 days of the date of the notice denying access to the database. The request for a hearing does not stay the denial of access under subsection (b) of this section. A dealer or converter may continue to seek a negotiated resolution with the department after a request for hearing has been submitted under this subsection by demonstrating the dealer or converter took corrective action or that the department's determination was incorrect.
(e) The department may also issue a Notice of Department Decision stating administrative violations as provided in §224.56 of this title (relating to Notice of Department Decision) concurrently with the notice of denial of access under this section. A Notice of Department Decision may include notice of any violation, including a violation listed under subsection (a) of this section.
(f) A department determination and action denying access to the temporary tag database becomes final if the dealer or converter does not request a hearing or enter into a settlement agreement with the department within 26 days of the date of the notice denying access to a database.

Source Note: The provisions of this §224.58 adopted to be effective June 1, 2024, 49 TexReg 2771