Answer:
You can use the Magswipe Configuration Utility to check the Security Level shown in the screenshots below. Security Level 3 means encryption is enabled. Security Levels other than 3 would indicate that the unit is not currently encrypting data. See What the different Security Levels mean.
you can also use the dotNET SDK Demo to check the Security Level by sending the "52 7E" command with the ITP wrap. The byte following the "7E" in the response indicates the Security Level: 31 is Level 1, 32 is Level 2, and 33 is Level 3.