HB 2240 — pawnbrokers

HB2240 - 542R - H Ver     House Engrossed         State of Arizona House of Representatives Fifty-fourth Legislature Second Regular Session COMMITTEE  ON  COMMERCE  HOUSE OFBILL REPRESENTATIVES2240 AMENDMENTS  TO  H.B.  AN ACT   amending sections 44‑1624, 44‑1626, 44-1627 and 44-1631, Arizona Revised Statutes;

2240relating (Reference to printedpawnbrokers. bill) Page 1, line 14, after the period strike remainder of line Strike line 15 Line 16, strike "OWNERSHIP OF THE PLEDGED COLLATERAL MOVES TO THE PAWNBROKER." Line 39, strike "twenty SEVEN" insert "twenty" Amend title to conform And, as so amended, it do pass JEFF WENINGER CHAIRMAN 2240COMMERCE 02/04/2020 02:30 PM H:

ra    (TEXT OF BILL BEGINS ON NEXT PAGE)   Be it enacted by the Legislature of the State of Arizona:

Section 1.  Section 44-1624, Arizona Revised Statutes, is amended to read:

START_STATUTE44-1624.  Pawn transactions;

twenty-four-hour cancellation period;

reportable transactions A.  The length of all pawn transactions is a minimum of ninety thirty days, except that a longer term may be contracted for between the pawnbroker and the pledgor for an original loan followed by a thirty-day grace period.  A pledgor may renew the loan at or before the end of the original thirty-day loan period or grace period.

 The pledgor may renew a loan at or before the end of the thirty-day grace period by paying pawn service charges pursuant to section 44‑1626 for a total of sixty days, which is the equivalent of pawn service charges for two thirty-day periods.  If a pledgor fails to pay or renew the loan after the forfeit date or the end of the original thirty-day loan period and thirty-day grace period, title to and ownership of the pledged collateral moves to the pawnbroker.

B.  In the first twenty-four-hour period after a person enters into a pawn transaction with a pawnbroker, the person may cancel the pawn transaction and is not responsible for any charges, fees, interest or other costs.

B.  C.  A pawnbroker shall not enter into a pawn transaction or good faith outright purchase of tangible personal property with a person who is less than eighteen years of age.

C.  D.  A pawnbroker shall not enter into a pawn transaction or good faith outright purchase of tangible personal property that has a manufacturer's serial number that has been removed, altered or obliterated.

D.  E.  Before entering into a pawn transaction or good faith outright purchase of tangible personal property a pawnbroker shall require the pledgor or seller to identify himself with an identification document sufficient to verify the information required pursuant to section 44-1625.

E.  F.  A pawnbroker shall retain any pledged goods at the pawnbroker's place of business or any other storage location approved by the applicable local law enforcement agency.

F.  G.  The A pawnbroker shall retain any property obtained by good faith outright purchase in its original form for twenty days after the original transaction date at the pawnbroker's place of business or other storage location approved by the applicable local law enforcement agency.

G.  H.  The A pawnbroker shall maintain at the pawnbroker's place of business records of all reportable transactions and pawn tickets and shall retain the records for at least two years after the date when the transaction occurred.  The pawnbroker shall ensure that the records include accurate copies of all transaction receipts or pawn tickets.  On request by a local law enforcement agent in the course of the agent's duties, the pawnbroker shall allow the agent to inspect the pawnbroker's receipts, pawn tickets or required alcohol, tobacco and firearms logs or to review any article received by the pawnbroker by pledge, purchase or trade.

H.  I.  A pawnbroker shall produce the pawnbroker's register, shall exhibit all articles received by the pawnbroker in pledge or purchase or shall produce the pawnbroker's account of sales to a local law enforcement agency on the agency's request to inspect the register, articles or accounts of sales of the pawnbroker or on service of a search warrant or order issued by a judge or magistrate.

J.  A pawn transaction is not reportable to a consumer reporting agency.

END_STATUTE Sec. 2.  Section 44-1626, Arizona Revised Statutes, is amended to read:

START_STATUTE44-1626.  Pawn service charge;

interest;

payment;

military members A.  Except as provided in section 44-1624, subsection B, a pawnbroker may charge or receive interest at a rate not exceeding thirteen per cent per month for the first two months and at a rate not exceeding eleven per cent per month thereafter.  A pawnbroker shall prorate interest on a daily basis and shall not impose an additional charge if the pledgor agrees to pay a loan in monthly installments, except that interest for two months may be charged or received if the pledged goods are redeemed within two months of the pawn transaction a pawn service charge.  A pawn broker may charge interest on the amount financed at a rate of not more than two percent per thirty‑day period.  A pawnbroker may impose a pawn service charge of any amount, except that the total amount, including the interest component, may not exceed twenty percent of the amount financed for each thirty‑day period in a pawn transacton.

B.  In addition to the pawn service charge and interest charged pursuant to subsection A of this section, a pawnbroker may charge and collect at redemption or renewal the following fees:

1.  A fee that does not exceed five dollars for handling each firearm.

2.  If the pledgor loses the pledgor's claim ticket, a fee that does not exceed seven dollars fifty cents.

3.  An initial setup fee of not more than five dollars.

4.  A storage fee that does not exceed five dollars per month or a portion of a month for each item of pledged goods, other than a vehicle as defined in section 28‑101, that exceeds one cubic foot in volume.

5.  A vehicle storage fee that does not exceed five dollars per day for each item of pledged goods that is a vehicle as defined in section 28‑101.

6.  a fee or charge equal to the amount of any fee, tax, imposition or assessment levied or imposed by any governmental agency in connection with or as a result of any reportable transaction.  The pawnbroker may collect at the time of any reportable transaction any fee, tax, imposition or assessment that relates to a reportable transaction and that is imposed by a governmental agency.

C.  A pawnbroker shall not demand or require payment of a pawn ticket before the maturity date.

D.  If a pawnbroker receives a copy of military orders that indicates that a pledgor has been deployed as a member of the Arizona national guard, the United States armed forces reserves or the regular component of the United States armed forces and the member is serving on federal active duty, the pawnbroker must waive any unpaid service or interest charges and hold the pledged goods until sixty days after the military member returns from deployment.

END_STATUTE Sec. 3.  Section 44-1627, Arizona Revised Statutes, is amended to read:

START_STATUTE44-1627.  Licensing;

requirements A.  A person shall not act as a pawnbroker until licensed by the sheriff of the county in which the person regularly conducts business.

B.  A pawnbroker shall obtain a separate license for each pawnshop owned by that pawnbroker.

C.  A pawnbroker license may not be sold or transferred without the approval of the sheriff or the sheriff's designee.

D.  A pawnbroker shall not conduct business at a location other than a licensed location except for firearms transactions that are permitted allowed by a federally licensed firearms dealer at an organized gun show.

E.  Every pawnbroker shall be a bona fide resident of this state.  If a partnership, each partner shall be a bona fide resident of this state.  If a corporation, it shall be a domestic corporation or a foreign corporation which that has qualified to do business in this state.  The corporation shall hold its pawnbroker license through an agent.

F.  The sheriff or the sheriff's designee shall require any person, other than a bank or licensed lending institution, having any interest, directly or indirectly, in a pawnshop to submit a full set of fingerprints, together with the applicable fingerprint processing fee, to the sheriff.  The sheriff shall submit the fingerprints to the department of public safety for the purpose of obtaining a state and federal criminal records check pursuant to section 41‑1750 and Public Law 92‑544.  The department of public safety may exchange this fingerprint data with the federal bureau of investigation.  The sheriff shall forward the fee to the department of public safety.

G.  A corporation shall own the entire equitable interest in its license through an agent if the agent is otherwise qualified to hold a pawnbroker license.  The agent is subject to the penalties prescribed for any violation of law relating to pawnbrokers.  On the death, resignation or discharge of an agent of a corporation holding a pawnbroker license, the corporation shall promptly assign the license to another qualified agent selected by the corporation.