Senate Bill No. 423
(By Senator Snyder)
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[Introduced February 8, 2000; referred to the Committee
on the Judiciary; and then to the Committee on Finance.]
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A BILL to amend chapter forty-seven of the code of West Virginia,
one thousand nine hundred thirty-one, as amended, by adding
thereto a new article, designated article twenty-five,
relating to the regulation of pawnbrokers; definitions;
providing that the secretary of state has authority to
promulgate registration application for pawnbrokers;
establishing license requirements and fees for pawnbrokers;
creating requirements for pawn tickets; requiring pawn
transaction reporting; establishing disclosure requirements
for pawn transactions; limitations on pawn agreements and
practices; providing for restitution to pawnbrokers and buyers
of property unlawfully obtained; prohibiting unfair trade
practices; and establishing criminal penalties for violations of licensing requirements, for pawning, selling or retaining
stolen property and using false identification to pawn or sell
property.
Be it enacted by the Legislature of West Virginia:
That chapter forty-seven of the code of West Virginia, one
thousand nine hundred thirty-one, as amended, be amended by adding
thereto a new article, designated article twenty-five, to read as
follows:
ARTICLE 25. PAWNBROKERS.
§47-25-1. Definitions.
(a) "Pawnbroker" means any person, partnership, association or
corporation advancing money in a pawn transaction in exchange for
collateral in the property of the pledgor.
(b) "Pawn transaction" means a transaction between a
pawnbroker and a pledgor where the pledgor's property is placed in
the possession of the pawnbroker as security for money or other
valuable consideration provided to the pawnbroker on the condition
that the pledgor may pay a pawn charge and redeem his or her
property within a predetermined time frame:
Provided, That pawn
transactions do not include those transactions where securities or
printed evidence of indebtedness are used as security for the
transaction.
(c) "Pledge" means an article or articles of property
deposited with a pawnbroker by a pledgor as security for money or
other consideration in a pawn transaction.
(d) "Pledgor" means a person who delivers the pledge into the
possession of a pawnbroker, unless such person discloses that he or
she is acting on behalf of another, and in such an event "pledgor"
means the disclosed principal.
§47-25-2. Registration requirements for pawnbrokers with the
secretary of state.
(a) After the first day of July, two thousand, persons engaged
in business as a pawnbroker shall comply with the provisions of
this article and shall register with the secretary of state.
(b) The secretary of state shall promulgate a registration
application for all pawnbrokers by the first day of May, two
thousand, so that registration applications may be applied for and
processed by the first day of July, two thousand.
(c) Upon receipt of a registration application, upon
verification that the person is a resident of the state, is at
least eighteen years of age and has adequate insurance coverage as
required by section three of this article, and upon receiving a
registration fee not to exceed one hundred dollars, the secretary
of state shall issue a two-year registration to the person to do business in this state as a pawnbroker. Separate applications and
licenses are required for each place of business of a pawnbroker,
and such registration certificate shall contain the pawnbroker's
business address and date of expiration. The license shall run
from the date of issuance to the end of the biennial period. When
the initial license is issued in the second year of the biennial
licensing period, the license fee shall be an amount equal to one
half of the fee for the biennial licensing period.
(d) Only licensed pawnbrokers may;
(1) Display any sign or other device in or about a place of
business, or use any advertising or printing material that
resembles an emblem or sign commonly used by pawnbrokers;
(2) Display any sign or other device in or about a place of
business or use any advertising or printing material indicating
that pawnbroker transactions take place at the business; and
(3) Represent to the public that he or she is a pawnbroker or
use the word "pawnbroker" either through advertising, soliciting,
signs or otherwise.
§47-25-3. Requirements of licensed pawnbrokers.
(a) No pawnbroker may sell any pledge until it has been in his
or her possession for three months, unless a shorter period of not
less than thirty days is agreed to in writing by the pledgor.
(b) All pawnbrokers are required to have an adequate fund or
insurance to cover the pledge value of all pledged property in the
control of the pawnbroker in the event of loss by fire, theft,
burglary or otherwise:
Provided, That such insurance coverage be
in an amount not less than thirty thousand dollars.
(c) All pawnbrokers shall continuously display their business
hours on the exterior front door of their place of business or on
another conspicuous location that is clearly visible to the public.
Their registration certificate shall also be prominently placed in
a location that is clearly visible to the public.
(d) Items bought outright shall be held for seven days before
being disposed of or sold and shall be subject to the reporting
requirements of sections four and five of this article:
Provided,
That items on invoice from a manufacturer or wholesaler with an
established place of business are exempt from the provisions of
this subsection.
(e) All pawnbrokers shall obtain verification of ownership
from each seller or pledgor on all sale or pawn transactions,
except for refinance pawn transactions or merchandise bought from
a manufacturer or wholesaler with an established place of business.
The verification of ownership shall appear on the bill of sale or
pawn ticket that is completed by the seller or pledgor at the time of the transaction.
(f) All pawnbrokers and their employees or agents shall admit
the chief law-enforcement officer, or his or her authorized agent
with the approval of the chief, of the jurisdiction where the
business is located or any law-enforcement officer of the state or
federal government during the pawnbroker's posted, regular business
hours. The pawnbroker shall permit the officer to examine all
records, including pawn tickets and pawn transaction forms,
required by this article and any article listed in a record that is
believed by the officer to be missing or stolen.
§47-25-4. Requirements for pawn tickets.
(a) Every pawnbroker shall keep at his or her place of
business an accurate and legible record of all pawn tickets written
by the pawnbroker for the previous three years. A pawn ticket
shall be written in ink or by another permanent recordation method
of each transaction made in the course of his or her business. The
pawn ticket shall be made at the time of the transaction and shall
include at a minimum:
(1) A description of the make, manufacturer, model, model
number, size, shape, serial number, year of manufacture or other
description of the property received;
(2) The time, date and place of the transaction;
(3) A transaction number for each individual piece of property
received;
(4) The full name, residence address, and home telephone
number of the person or persons, together with a personal
description, including the height, weight, date of birth, social
security number, hair, and eye color of such person or persons;
(5) Verification of the identity of the person by the
pawnbroker by examining the state-issued identification card,
driver's license or federal passport other government-issued photo
identification card of the person and noting the identification
exhibited, the issuing agency, and the number thereon with a copy
thereof being kept by the pawnbroker;
(6) The maturity date, amount financed, finance charge, total
payments, annual percentage rate, payment schedule and prepayment
terms;
(7) The signature of the pledgor upon placing the pledge and
upon redeeming the pledge; and
(8) A statement that complies with the federal Truth in
Lending Act, 15 U.S.C.§1601 et seq., as amended, containing, at a
minimum, the following information:
The pledged merchandise listed has been honestly acquired and
is clear of all encumbrances. I hereby pledge complete title to this merchandise to lender for the sum of the amount financed, the
receipt of which is hereby acknowledged, and I agree to warrant and
defend the title. I agree that I am indebted to lender for the
sum, plus finance charges. In the event the total of payments is
not paid on the due date, or my loan renewed by payment of the
monthly charge, lender shall become vested with all right, title
and interest of myself and/or my assigns to such merchandise to
hold and dispose of as its own property, without any notice to, or
demands from me.
(b) In addition to the information required in subsection (a)
of this section, a description of firearms including the color,
caliber and size of the firearms.
§47-25-5. Required transaction reporting on a pawn transaction
form.
(a) Every pawnbroker shall each day prepare a report on a pawn
transaction form of all the transactions conducted by the
pawnbroker for that day.
(b) The pawn transaction form shall include all the
information required by subdivisions (1), (2), (3), (4) and (5),
subsection (a), section four of this article.
(c) The pawn transaction form shall be made available to
law-enforcement officers pursuant to section three of this article.
§47-25-6. Pawnbroker disclosure requirements for pawn transactions.
(a) Upon receipt of any pawned property, the pawnbroker shall
deliver to the pledgor a copy of the completed pawn ticket required
by section four of this article.
(b) Nothing appearing on a pawn ticket shall relieve the
pawnbroker of the obligation to exercise reasonable care while in
control of and exerting custody over property pledged pursuant to
this article.
(c) No additional terms or conditions may be imposed upon the
pledgor for redemption of property that are not disclosed on the
pledge ticket.
(d) A written receipt shall be maintained by the pawnbroker
and provided to the pledgor for any moneys paid in payment or
redemption of pawned property.
§47-25-7. Limitation on agreements and practices.
(a) Notwithstanding that a pawn transaction subject to this
article creates a debtor/creditor relationship between the parties,
a pawnbroker may not make any agreement requiring the pledgor to
personally guarantee a loan in connection with a pawn transaction.
Only property in the possession of the pawnbroker may serve as
collateral for a pawn transaction.
(b) No pledgor has an obligation to redeem pledged goods or make any payment on a pawn transaction. Except as otherwise
provided in this article and under law, the only recourse of a
pawnbroker has against a pledgor is to take full control and
ownership over the property pledged by the pledgor.
(c) Any pledged property not redeemed within thirty days
following the last fixed maturity date may be forfeited and become
the property of the pawnbroker at his or her option.
(d) A pawnbroker may not:
(1) Accept a pledge or purchase property from a person under
the age of eighteen years;
(2) Fail to exercise reasonable care to protect pledged
property from loss or damage;
(3) Fail to return property to a customer upon payment of the
full amount due the pawnbroker;
(4) Accept collateral or buy merchandise from a person unable
to supply verification as required by this article; or
(5) Purchase or take any article in pawn or pledge from any
person appearing to be intoxicated or under the influence of any
drug.
(e) No property pledged to any pawnbroker may be disfigured or
its identity destroyed or affected in any manner while under the
control of the pawnbroker nor may any property be concealed for forty-eight hours after the property is received by the pawnbroker.
(f) Except as otherwise provided by this article, any person
properly identifying him or herself as the original pledgor in the
pawn transaction, or upon written evidence of assignment thereof,
who presents a pawn ticket to the pawnbroker shall be presumed to
be entitled to redeem the pledged property described on the pawn
ticker.
(g) Every pawnbroker who sells any pledged property before the
time to redeem the property has expired shall make full restitution
for the value of the property to the pledgor.
§47-25-8. Prohibition against unfair competition and other unfair,
deceptive and fraudulent acts.
No provision of this article is to be construed to provide an
exception from other laws of a state or of the United States
governing unfair competition and unfair, deceptive and fraudulent
acts or practices, including the provisions of chapter forty-six-a
of this code and of the federal Truth in Lending Act.
§47-25-9. Criminal penalties.
(a) Any person who violates the provisions of this article is
guilty of a misdemeanor and, upon conviction thereof, shall be
fined not more than two thousand dollars.
(b) Every pawnbroker who sells any pledged property before the maturity date or continues to accept payment for property already
sold is guilty of a misdemeanor and, upon conviction thereof, shall
be fined not more than two thousand dollars.
(c) Every pawnbroker who willfully refuses to disclose the
name of the purchaser and the price received for any article
received in pledge and subsequently sold is guilty of a misdemeanor
and, upon conviction thereof, shall be fined not more than two
thousand dollars.
(d) Every pawnbroker who refuses or omits to exhibit property
upon the demand of an investigating law-enforcement officer as
provided by this article is guilty of a misdemeanor and, upon
conviction thereof, shall be fined not more than two thousand
dollars.
(e) Any person selling or pledging property to a pawnbroker
using false or altered identification or verification of ownership
is guilty of a misdemeanor and, upon conviction thereof, shall be
fined not more than two thousand dollars.
NOTE: The purpose of this bill is to license and otherwise
regulate pawnbrokers.
This article is new; therefore, strike-throughs and
underscoring have been omitted.
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