By Fran Bishop
Pawnbrokers have always been buyers of gold regardless of the spot price, second London fix, futures or any of the rest of those calculations. Over the last couple years we have all watched the price of gold continue to escalate and marvel at what threshold will be reached next. How high will it go? When will it drop? Where will it level off? All the while pawnbrokers continue with business as usual…..buying, selling, scrapping, and complying with laws, regulations and hold periods.
And with gold prices continuing to rise, here came the internet buyers and the flashy Super Bowl ads enticing you to just drop it in the mail. But locally we began to see in the newspapers, radio and cable channels that the ‘ole prospector’ will be at room 113 of the Dew Drop Inn for 4 hours on Saturday with lots of cash for your gold. We all knew there were no record-keeping or compliance measures taking place there, which couldn’t be good in the long run, and besides that, it posed an unfair advantage over licensed businesses.
An opportunity to rectify this situation presented itself to us last spring. Our Alabama Pawnbrokers Association Lobbyist, Mike Weeks, sent us a newly filed senate bill that would license and regulate the transient gold buying business in our state. As it was not long until the 2010 legislative session would be over, we quickly reviewed the bill and found that it began with law enforcement’s frustration over the rising number of jewelry burglaries, which they determined was being quickly disposed of through ‘hotel buyers’ that kept no records and were here today, gone tomorrow.
It was a great start, but we felt it didn’t go far enough to level the playing field by comparison to the laws and regulations of Alabama pawnbrokers. We prepared amendments to the bill that we felt would accomplish this and our Lobbyist approached Senator Marsh, who accepted all of them. Some of these include:
- valid and traceable identification of the seller, including signature,
- an age requirement
- description of merchandise
- the same hold period as pawnbrokers
- records maintained and made available to law enforcement
- payment to seller by check only, AND
- may only operate from a permanent place of business either owned or leased by them for at least one year.
On hearing day, a delegation of Alabama pawnbrokers traveled to our State Capitol to walk the halls in support of the bill and visit with our friends in the House and Senate. The bill came out of committee by unanimous vote and in the waning hours of the 2010 session was passed by both chambers. It was signed into law by our Governor and went into effect on July 1, 2010 thus bringing the ‘ole prospector’ to the end of the trail.
Then it was up to us to make sure our local authorities were aware of the new law. I sent a copy to my Police Chief, Mayor, Sheriff, District Attorney, and the news media. Even though our District Attorney issued a press release covering the new regulations and how they would be enforced, our local police on two occasions have had to greet ‘prospectors’ at the local motel and show them the way out of town.
We didn’t go out looking for a way to put anyone out of business, but when the opportunity presented itself to work with law enforcement and level playing field for the pawn industry, we couldn’t have been more pleased. I have shared our AL ‘transient gold buyers’ law with several of you who were interested and am aware that Mississippi currently has a similar bill working in their legislature. The NPA office has it on file and will make a copy available.
