HOUSE BILL NO. 5995
July 23, 2020, Introduced by Reps. Wakeman and Marino and referred to the Committee on Regulatory Reform.
A bill to amend 1917 PA 273, entitled
"An act to regulate and license pawnbrokers that conduct business in this state; to provide for the disposition of allegedly misappropriated property in the possession of pawnbrokers; to provide remedies and prescribe penalties; and to provide for the powers and duties of certain local governmental units and state agencies,"
by amending the title and sections 1, 2, 3, 5, and 6 (MCL 446.201, 446.202, 446.203, 446.205, and 446.206), the title as amended by 2018 PA 345, sections 1 and 3 as amended by 2006 PA 292, and sections 2, 5, and 6 as amended by 2002 PA 469.
the people of the state of michigan enact:
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TITLE
An act to regulate and license pawnbrokers that conduct business in this state; to provide for the disposition of allegedly misappropriated property in the possession of pawnbrokers; to provide for the implementation, maintenance, and administration of a statewide electronic database of pawned items and certain other articles of personal property; to provide remedies and prescribe penalties; and to provide for the powers and duties of certain local governmental units and state agencies.
Sec. 1. (1) A person, corporation, or firm shall not conduct business as a pawnbroker in any of the governmental units of this state without having first obtained from a license issued by the chief executive officer of that governmental unit a license under this act that authorizes that person, corporation, or firm to conduct that business. This However, this subsection does not require an internet drop-off store complying that complies with subsection (3), or a person an individual who is engaged in the sale, purchase, consignment, or trade of personal property or other valuable thing for himself or herself, to obtain a license under this act.
(2) Licensure under either or both of the following acts does not exempt a person from obtaining a license under this act:
(a) The Registration under the precious metal and gem dealer act, 1981 PA 95, MCL 445.481 to 445.492, .
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(b) does not exempt a person that is conducting business as a pawnbroker from the requirement to obtain a license under this act. Licensure under 1917 PA 350, MCL 445.401 to 445.408, does not exempt a person that is conducting business as a pawnbroker from the requirement to obtain a license under this act.
(3) An A person that operates an internet drop-off store in compliance with that meets the following conditions is exempt from licensure the requirement to obtain a license as a pawnbroker under this act:
(a) Has The person has a fixed place of business within in this state. except that he or she
(b) The person exclusively transacts all purchases or sales by means of the internet and the purchases and sales are not physically transacted on the premises of that the fixed place of business described in subdivision (a).
(c) (b) Has The person has the personal property or other valuable thing available on a website for viewing by photograph, if available, by the general public at no charge, which website shall be and the website is searchable by zip code or state, or both. The website viewing shall include, as applicable, serial number, make, model, and other unique identifying marks, numbers, names, or letters appearing on the personal property or other valuable thing.
(d) (c) Maintains The person maintains records of the sale, purchase, consignment, or trade of the personal property or other valuable thing for at least 2 years. , which The records shall contain a complete and accurate description, including a photograph, if available, and, if applicable, serial number, make, model, and other unique identifying marks, numbers, names, or letters appearing on the personal property or other valuable thing.
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(e) (d) Provide the The person provides a local police agency with any name under which it conducts business on the website and access to the business premises at any time during normal business hours for purposes of inspection.
(f) (e) Within 24 hours after a request from a local police agency, provide the person provides an electronic copy of the seller's or consignor's name, address, telephone number, driver license number and issuing state, the buyer's name and address, if applicable, and a description of the personal property or other valuable thing as described in subdivision (c). (d). The provision of person shall provide the information shall be in a format that is acceptable to the local police agency but shall at least be in a legible format and in the English language.
(g) (f) Provide The person provides that payment for the personal property or other valuable thing is executed by means of check or other electronic payment system, so long as the payment is not made and not in cash. No The person shall not provide payment shall be provided to the seller until the item is sold.
(h) (g) Immediately remove The person immediately removes the personal property or other valuable thing from the website if the local police agency determines that the personal property or other valuable thing is stolen.
Sec. 2. (1) The Subject to subsection (5), the chief executive officer of the a governmental unit may grant under his or her hand, and the official seal of his or her office, to any suitable person, corporation, or firm a license authorizing issue a license to any suitable person under this act that authorizes that person, corporation, or firm to conduct the business of a pawnbroker in that governmental unit, subject to the provisions of this act.
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(2) The A license issued under this section shall designate the particular place in the governmental unit where that person, corporation, or firm shall conduct the pawnbroker business. A person, corporation, or firm receiving that receives a license under this section shall not conduct the a pawnbroker business in any other place than the place designated in the license.
(3) The term of a license issued under this section is 1 year, from beginning on the date of issuance. , unless revoked The license is revocable for cause, and is not transferable.
(4) Before issuance of the license, the applicant shall pay A chief executive officer shall not issue a license under this section unless the applicant does all of the following at the time the application is submitted:
(a) Pays to the treasurer of the governmental unit an annual license fee. in the amount determined under subsection (5) and give The governmental unit shall determine the specific amount of the annual license fee, but the governmental unit shall not establish an annual license fee that is less than $50.00 or more than $500.00.
(b) Provides a bond to the governmental unit that is in its corporate name, in the penal sum of $3,000.00, with at least 2 sureties, that is conditioned for on the faithful performance of the duties and obligations pertaining to the conduct of the pawnbroker business and for the payment of all costs and damages incurred by as a result of any violation of this act, . The governmental unit shall approve the bond.and that is satisfactory to the governmental unit.
(5) The governmental unit may fix the amount to be paid as the annual license fee at any amount not less than $50.00 or more than
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$500.00.
(c) Provides to the chief executive officer proof of payment of the fee described in section 6(5) to the department.
(d) Pays the treasurer of the governmental unit an application processing fee, if any. A governmental unit may establish an application processing fee, in an amount that does not exceed $50.00, for the review and processing of license applications under this section.
(5) (6) Notwithstanding any other provision of this section, the The authority of a governmental unit to issue a license under this act section is limited as follows:
(a) A county may shall not issue a license for a location within in a city or village with that has a population greater of more than 3,000.
(b) A county may shall not issue a license for a location within in a city or village with that has a population of 3,000 or less fewer or within in a township or charter township if that city, village, township, or charter township has established the license fee pursuant to under subsection (5).(4)(a).
(c) A township or charter township may shall not issue a license for a location within in a village with that has a population over of more than 3,000 or a village with that has a population of 3,000 or less fewer that has established a an annual license fee under subsection (5).(4)(a).
(6) A governmental unit shall not adopt or enforce a local law, ordinance, resolution, or rule that duplicates, extends, revises, or conflicts with any provision of this act.
Sec. 3. As used in this act:
(a) "Chief executive officer" means any of the following:
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(i) For a city, the mayor.
(ii) For a village, the village president.
(iii) For a township or charter township, the township supervisor.
(iv) For a county, the county executive or, if there is no county executive, the person an individual designated by a resolution of the county board of commissioners.
(b) "Department" means the department of state police.
(c) (b) "Governmental unit" means a city, township, charter township, county, or incorporated village.
(d) (c) "Internet drop-off store" means a person, corporation, or firm that contracts with other persons, corporations, or firms another person or persons to offer its personal property or other valuable thing items for sale, purchase, consignment, or trade through means of an internet website and meets the conditions described in section 1(3).
(e) "Item" means an article of personal property or any other valuable thing, except securities or printed evidence of indebtedness.
(f) (d) "Local police agency" means the police agency of the city, village, or township, or if none, the county sheriff of the county, in which the a pawnbroker or internet drop-off store conducts business.
(g) (e) "Pawnbroker" means a person, corporation, or member, or members of a copartnership or firm, who that loans money on deposit, or pledge of personal property, or other valuable thing, other than securities or printed evidence of indebtedness, or who 1 or more items or that deals in the purchasing of personal property or other valuable thing items on condition of selling the same
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those items back again at a stipulated price.
(h) "Pawned item" means an item taken by a pawnbroker as collateral for a loan.
(i) "Person" means an individual, partnership, corporation, limited liability company, or other legal entity.
(j) "Purchased item" means an item that is acquired for cash by a pawnbroker without the intent to sell or return that item back to the seller.
(k) "Reportable item" means any of the following:
(i) An item pawned to or purchased by a pawnbroker in this state.
(ii) A precious item received or purchased by a dealer in this state under the precious metal and gem dealer act, 1981 PA 95, MCL 445.481 to 445.492. As used in this subparagraph, "dealer" and "precious item" mean those terms as defined in section 2 of the precious metal and gem dealer act, 1981 PA 95, MCL 445.482.
(iii) A second hand article purchased or received in exchange by a second hand dealer or junk dealer under 1917 PA 350, MCL 445.401 to 445.408. As used in this subparagraph, "second hand dealer" and "junk dealer" mean those terms as defined in section 3 of 1917 PA 350, MCL 445.403.
Sec. 5. (1) A pawnbroker shall keep a record prepare in English, at the time the pawnbroker receives any article of personal property or other valuable thing by way of pawn, that includes a description of the article, a sequential transaction number, any amount of money loaned on the article, the name, residence, general description, and driver license number, official state personal identification card number, or government identification number of the person from whom the article was
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received, and the day and hour when the article was received. and permanently retain, a separate, accurate, and legible record of each transaction in which it acquires a pawned item or purchased item. The record, the pawnbroker's place where the of business, is carried on, and all articles of property items in that place of business are subject to examination at any time by the attorney of the governmental unit, a local police agency, the county prosecuting attorney of the county in which the governmental unit is situated, or the department. of state police.
(2) Upon the receipt of any article of personal property or other valuable thing by way of pawn, the pawnbroker shall make a permanent record of the transaction on a form provided by the pawnbroker that substantially complies with the form described in subsection (4). Each record of transaction shall be completed in duplicate by the pawnbroker, legibly in the English language, and shall contain all applicable information required to complete the record of transaction form under subsection (4). This subsection does not prohibit the use and transmission of the information required in the record of the transaction by means of computer or other electronic media as permitted by the local police agency within the applicable governmental unit.
(3) The pawnbroker shall retain a record of each transaction and, within 48 hours after the property is received, shall send 1 copy of the record of transaction to the local police agency.
(4) The record of transaction form shall be 8-1/2 inches by 11 inches in size and shall be as follows:
FRONT
Article
Serial No.
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Model No. or Case No.
Lens No. or Move. No.
Trade Name
Color
Size
No. Jewels
Material
Stone Set Design
Description
No.
Kind of Stone
Size
Inscription or Initials
Purchase Price
Amt. Loaned
Dealer
City
Date
Ticket No.
Lady's []
Gent's[]
Wrist []
Pocket[]
Lapel[]
Operator's License # or Other I.D. #
Customer's Name (PRINT)
Street No. or RFD
City and State
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Employed By:
Rolled print of right thumb
(If impossible then some
Age
Height
other fingerprint.
Designate which.)
Weight Race W [] B [] O []
Time Received:
AM
PM
Mail reports within 48 hours to
local officers
[] Male
[] Female
Signature of person taking print
(2) The record described in subsection (1) must include all of the following information about each pawned item or purchased item that is acquired by the pawnbroker:
(a) A complete and accurate description of the item.
(b) If applicable, the serial number, model number, case number, or lens number of the item.
(c) If applicable, the item's trade name, color, size, number of jewels, material, stone set design, number of stones, description, kind, and size of each stone, inscription, or initials.
(d) For a pawned item, the amount loaned on the item.
(e) For a purchased item, the purchase price of the item.
(f) The pawnbroker's name and address.
(g) The date and time of the transaction and the name of the employee of the pawnbroker who acquired the pawned item or purchased item, or authorized the acquisition of the pawned item or
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purchased item, on the pawnbroker's behalf.
(h) The transaction number.
(i) The name and address of the owner of the pawned or purchased item.
(j) The name and operator's license number or other identification number of the individual from whom the item was received; his or her date of birth, height, gender, weight, and race and the name of the employee of the pawnbroker who acquired the pawned item or purchased item, or authorized the acquisition of the pawned item or purchased item, on the pawnbroker's behalf; and his or her signature.
Sec. 6. A pawnbroker shall make daily, except Sunday, a sworn statement of his or her transactions, describing the articles received, and setting forth the name, residence, and description of the person from whom the articles were received, to the chief of police or chief law enforcement officer of the governmental unit.
(1) Within 48 hours after it receives a pawned item in a transaction described in section 5(1), a pawnbroker shall electronically transmit the information described in section 5(2)(a), (b), (d), and (f) to (h) for that item to the department, in a format determined by the department. A pawnbroker shall retain an electronic copy of any information transmitted under this subsection for at least 5 years, in a format determined by the department.
(2) Within 48 hours after it receives a purchased item in a transaction described in section 5(1), a pawnbroker shall electronically transmit the information described in section 5(2)(a), (b), and (e) to (h) for that item to the department, in a format determined by the department. A pawnbroker shall retain an
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electronic copy of any information transmitted under this subsection for at least 5 years, in a format determined by the department.
(3) Within 90 days after the effective date of the amendatory act that added this subsection, the department shall implement and maintain a statewide electronic database of reportable items. All of the following apply to the database:
(a) The database shall include the information transmitted to the department under any of the following:
(i) Subsection (1) or (2).
(ii) Section 4a of the precious metal and gem dealer act, 1981 PA 95, MCL 445.484a.
(iii) Section 4a of 1917 PA 350, MCL 445.404a.
(b) Only the department and other law enforcement agencies shall have access to the information in the database.
(c) The department may operate the database or may select and contract with a single third-party provider to operate the database. If the department contracts with a third-party provider for the operation of the database, all information obtained from any of the following shall be electronically stored in the department:
(i) Pawnbrokers under this section.
(ii) Dealers under the precious metal and gem dealer act, 1981 PA 95, MCL 445.481 to 445.492. As used in this subparagraph, "dealer" means that term as defined in section 2 of the precious metal and gem dealer act, 1981 PA 95, MCL 445.482.
(iii) Second hand dealers or junk dealers under 1917 PA 350, MCL 445.401 to 445.408. As used in this subparagraph, "second hand dealer" and "junk dealer" mean those terms as defined in section 3
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of 1917 PA 350, MCL 445.403.
(d) Information in the database, and any information forwarded to the department or to a third-party provider for inclusion in the database, is confidential; is not subject to disclosure under the freedom of information act, 1976 PA 442, MCL 15.231 to 15.246; and shall not be disclosed by the department, a third-party provider, or any person to any other person, except for purposes of this act and for law enforcement purposes.
(4) Within 180 days after the effective date of the amendatory act that added this subsection, each pawnbroker shall implement any software that the department determines is necessary to administer the collection of information required under this section and the retention of information by the pawnbroker under subsection (1) or (2).
(5) Each pawnbroker shall pay an annual fee of not more than $250.00 for each of its licensed locations for the implementation and maintenance of the database described in this section. The department shall determine the specific amount of the fee and collect the fee.
Enacting section 1. This amendatory act takes effect 90 days after the date it is enacted into law.
Enacting section 2. This amendatory act does not take effect unless all of the following bills of the 100th Legislature are enacted into law:
(a) Senate Bill No.____ or House Bill No. 5997 (request no. 05113'19).
(b) Senate Bill No.____ or House Bill No. 5996 (request no. 05989'19).