Criminal tattoos were used by the Time Lords to mark their criminals. (PROSE: Christmas on a Rational Planet) The tattoos were the surface-marks of "biodata tags" (PROSE: The Book of the War, Lords and Masters) that allowed the ruling Houses to track the timelines of criminals. (PROSE: The Book of the War)
When Romana II released three hundred prisoners from the prison asteroid, their dragon tattoos "snapped" on their arms as they exited stasis. One of these prisoners, Grandfather Paradox, (PROSE: Christmas on a Rational Planet) subsequently cut off that arm so House authorities could not link him to his own history. (PROSE: The Book of the War)
The criminal tattoo was on the shoulder of a severed arm that Academician Devonire purchased from Immaculata Formosii while searching for Grandfather Paradox's; however, he later found that the tattoo was added long after the arm was severed. The arm was in fact his own. (PROSE: The Book of the War)
After realising that the cryogenic systems on their prison world were too easy to escape, the Great Houses started wiring prisoners' nervous systems into self-repeating time frames via convict tattoos on their upper right arms.
When Demetra Kine broke out of containment and started freeing the other prisoners, her seguaché Mandeema Kweller modified the tattoos with memeodermal imprinting so that Demetra could see and speak through them. They could also bite any part of the wearer's body. Demetra also attached a tattoo to the prison guard Selvynkesh. (AUDIO: Movers)