02/03/2003 03:15 PM House L&C
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+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE LABOR AND COMMERCE STANDING COMMITTEE
February 3, 2003
3:15 p.m.
MEMBERS PRESENT
Representative Tom Anderson, Chair
Representative Bob Lynn, Vice Chair
Representative Nancy Dahlstrom
Representative Carl Gatto
Representative Norman Rokeberg
Representative Harry Crawford
Representative David Guttenberg
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 66
"An Act relating to certain persons who buy and sell secondhand
articles, to certain persons who lend money on secondhand
articles, and to certain persons who seek or receive loans on
secondhand articles."
- HEARD AND HELD
PREVIOUS ACTION
BILL: HB 66
SHORT TITLE:PAWNBROKERS/SECONDHAND DEALERS
SPONSOR(S): REPRESENTATIVE(S)SAMUELS
Jrn-Date Jrn-Page Action
01/27/03 0076 (H) READ THE FIRST TIME -
REFERRALS
01/27/03 0076 (H) L&C, FIN
01/27/03 0076 (H) REFERRED TO LABOR & COMMERCE
01/29/03 0089 (H) COSPONSOR(S): MCGUIRE
01/31/03 0108 (H) COSPONSOR(S): HEINZE
02/03/03 (H) L&C AT 3:15 PM CAPITOL 17
WITNESS REGISTER
REPRESENTATIVE RALPH SAMUELS
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As sponsor of HB 66, introduced his bill
and answered questions about it.
ART GRISWOLD
Delta Junction, Alaska
POSITION STATEMENT: Asked questions about how HB 66 would
affect his future secondhand business.
MARK MEW, Deputy Chief
Administration
Anchorage Police Department
Municipality of Anchorage
Anchorage, Alaska
POSITION STATEMENT: Spoke in favor of HB 66 and described the
Anchorage Police Department's work with pawnshop reporting under
a municipal ordinance.
LAURA ACHEE, Staff
to Representative Ralph Samuels
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Answered questions about the misdemeanor
changes in HB 66.
MATT LEVEQUE, Lieutenant
Division of Alaska State Troopers
Department of Public Safety
Anchorage, Alaska
POSITION STATEMENT: Offered the department's conceptual support
for HB 66 but raised concerns about whether the proposed
Internet reporting will mesh with the Alaska State Troopers'
computer system.
JERRY CLEWORTH, Owner
Alaska Rare Coins
Fairbanks, Alaska
POSITION STATEMENT: Testified against HB 66 on behalf of seven
retail businesses in downtown Fairbanks; he protested that a 30-
or 45-day hold is prohibitive and the reporting requirements are
absurd.
JOHN SHACKLEY, Owner
Rocket Surplus
Fairbanks, Alaska
POSITION STATEMENT: As owner of a military surplus store, spoke
in opposition to HB 66; he raised questions about how to handle
the documentation on the purchase and resale of large lots of
military uniforms and clothing.
BILL HOYT, Owner
Wasilla Pawn Shop
Wasilla, Alaska
POSITION STATEMENT: Questioned the required payments to
pawnshop customers in HB 66.
CONRAD HOLLER, Owner
Rainbow Pawn Shop
Wasilla, Alaska
POSITION STATEMENT: Spoke in opposition to HB 66, noting that
the current law works and criticizing the 45-day hold period.
JOHN MINNICK, Owner
A-1 Pawn Shop
Wasilla, Alaska
POSITION STATEMENT: Indicated he would meet with legislators in
Juneau to discuss his concerns about HB 66.
DEBORAH FINK, Owner
Cash Alaska
Anchorage, Alaska
POSITION STATEMENT: Spoke in favor of state pawn legislation
and volunteered to offer industry perspective on revisions to HB
66, including the types of items and businesses that should be
exempted; noted that under the Anchorage ordinance, she already
files regular reports.
JEFF GREGG, Detective
Theft Section
Anchorage Police Department
Municipality of Anchorage
Anchorage, Alaska
POSITION STATEMENT: Described how the current Anchorage
ordinance works, gave examples of tracking stolen property, and
described how stolen property is being sold out of Anchorage.
ACTION NARRATIVE
TAPE 03-5, SIDE A
Number 0040
CHAIR TOM ANDERSON called the House Labor and Commerce Standing
Committee meeting to order at 3:15 p.m. Present at the call to
order were Representatives Anderson, Lynn, Dahlstrom, Gatto,
Crawford, and Guttenberg; Representative Rokeberg arrived as the
meeting was in progress.
HB 66-PAWNBROKERS/SECONDHAND DEALERS
Number 0075
CHAIR ANDERSON announced the only order of business would be
HOUSE BILL NO. 66, "An Act relating to certain persons who buy
and sell secondhand articles, to certain persons who lend money
on secondhand articles, and to certain persons who seek or
receive loans on secondhand articles."
Number 0075
REPRESENTATIVE RALPH SAMUELS, Alaska State Legislature, sponsor
of HB 66, explained that the purpose of this bill is to help
victims recover more of their stolen property in a timely
fashion. At present, pawnshops are required to log the make,
model, and serial number of the items they buy and the name of
the seller. These logs must be made available to law
enforcement officers upon request. When the police receive a
report of stolen goods, they enter the key information into a
database, including the facts of the crime. Representative
Samuels stated that the process of matching the data collected
by pawnshops and the police system doesn't work very well. This
bill would require those two systems to automate and to start
talking to each other.
Number 0275
REPRESENTATIVE SAMUELS explained that automation in real time is
the key to tracking stolen goods. The goal of HB 66 is for a
pawnshop owner to enter the details of a proposed purchase in
the computer and learn if an item was stolen while the seller is
still present in the store. The bill puts a 30-day hold on
items that are pawned, giving law enforcement officials more
time to enter the details into their databases. With real-time
data exchange, the police would enter data about a burglary into
their database, and if there's a match with the pawnshops' data,
the police would get a hit for the items at a pawnshop, plus a
record of who pawned it. This bill also requires that pawnshops
become licensed so their activities can be monitored. The bill
is aimed at automating the large pawnshops rather than small
operations.
Number 0308
REPRESENTATIVE SAMUELS explained that HB 66 focuses on statewide
enforcement rather than depending on local police to regulate
pawnshop activities. Many goods stolen in Anchorage are hocked
in surrounding communities in order to avoid detection by the
Anchorage police. A software program developed by a Canadian
software company, BWI [Business Watch International], uses the
Internet to transmit the transactions between pawnshops and
local law enforcement agencies. This software can sort
information by various fields, for example, by the number of
pawns. In one case, law enforcement officers noted a woman who
had pawned 450 items in one month; that information led police
to her sons who had been committing burglaries.
REPRESENTATIVE SAMUELS noted two exemptions in HB 66. One is
for used car dealers who already file reports with the Division
of Motor Vehicles, Department of Administration, and the other
exemption is for commodities dealers. For example, commodity
dealers are businesses that deal with gold bullion; they would
be put out of business if they had to hold gold for 30 days.
Number 0536
ART GRISWOLD, Delta Junction, described a theoretical business
that buys and sells secondhand merchandise. He asked if the
owner is required to report all purchases. He expressed concern
that a citizen with financial troubles who sells personal items
to a pawnshop would be added to a police database.
Number 0689
REPRESENTATIVE SAMUELS noted that a legal opinion states that
this bill does not violate a person's right to privacy, which,
he admitted, is somewhat different from Mr. Griswold's privacy
concern. He pointed out that pawnshops are already required by
state law to record all sales; HB 66 would upgrade that
recording process from manual to automated. Representative
Samuels said he would consider amending his bill to exempt
purchases from auctioneers and other dealers.
Number 0764
MR. GRISWOLD, in response to Representative Rokeberg, explained
that he is describing a secondhand or junk store he plans to
open next year. He posed the problem of recording the purchase
of baby clothes from a Russian-speaking woman who barely speaks
English.
Number 0889
REPRESENTATIVE GATTO asked Representative Samuels about the
change in HB 66 on page 5, lines 11-13, which removes the
details of misdemeanor penalties but upgrades the offense to a
class A misdemeanor.
Number 0910
REPRESENTATIVE SAMUELS responded that including both the
misdemeanor and its penalties could cause conflicts in future
law when those penalties change.
Number 0950
MARK MEW, Deputy Chief, Administration, Anchorage Police
Department (APD), Municipality of Anchorage, said that the
Anchorage Assembly passed an ordinance similar to this bill
about 20 years ago. He opined that it works well. Pawnshops
are required to report their purchases to the police department,
to hold their property for 30 days, and during that period of
time, the police try to match pawnshop data against the stolen
property information in their record management system. When
the police find matches, they require the pawnshop to put the
property in question on hold.
MR. MEW explained that when he started work as a detective, the
department's system was manual. Now APD has progressed to a
point were most pawnshops can deliver their data on a floppy
disk, while other shops send it by e-mail. Department staff
must massage the data to bounce it off the department's record
management system. He said the APD is getting better at this,
and as a result, thieves are selling stolen property outside the
Anchorage jurisdiction, on the Kenai Peninsula and in the
Matanuska Valley. The Anchorage Police Department supports HB
66 because the lack of a statewide measure hampers its efforts
to recover stolen property. Mr. Mew said he thinks APD is
losing track of lots of stolen property because of this
inefficiency.
Number 1021
MR. MEW testified that HB 66 gives a break to pawnshops that
automate their reporting criteria. State law already requires
that all sales be recorded. If a pawnshop doesn't automate, the
owner can still deliver the data manually. But the owner must
hold the property longer because the police department must
enter the data by hand.
MR. MEW explained that the computer software proposed for use
under this statute is offered to pawnshops at no cost; the
stores only need access to the Internet. The software would
manage many pawnshop business functions: maintaining inventory;
recording sales; showing the location of property on the store
shelves; and printing reports. The software also collects the
information on the person doing the pawn and bounces it - either
by real time or once a day - off the police department's stolen
property files. The user can set up the program so that the
pawnshop, the police department, or both are notified when the
system makes a hit on stolen goods. Statewide, city police
departments could recover each other's stolen property. These
software companies have tried to create a program that makes
recordkeeping more convenient than the way pawnshops do business
now. Mr. Mew said he doesn't think this poses a big hardship on
the customer or the pawnshop owner. He noted that there is a
new pilot project in Juneau and Anchorage whereby pawnshops are
voluntarily trying this software. He said he wants pawnshops to
get used to an automated database so they can reduce their hold
time under HB 66.
Number 1232
MR. MEW addressed the issue of customer privacy. In Anchorage,
where the police collect thousands of pawn transactions,
officers don't have time to wonder who's fallen on hard times.
MR. MEW said state law already requires all secondhand and
pawnshop dealers to record their transactions, with the two
exceptions. However, APD isn't enforcing compliance by the
secondhand shops because it doesn't have enough detectives to do
so. He explained that in Anchorage, the secondhand stores have
gotten themselves removed from the municipal ordinance, but they
are still required to keep a permanent record of their
purchases.
Number 1331
REPRESENTATIVE GATTO asked about Section 6 of the bill, page 5,
lines 8-13, which adds reference to a class A misdemeanor but
deletes the details of the fine and jail sentence.
MR. MEW replied that under existing law, if a person pawns
stolen property knowingly, either as a fence or a broker, the
person will be charged with an offense based on the value of the
property. A person can be found guilty of a theft by disposing
of stolen property, even if the underlying burglary or robbery
cannot be proven. This new language penalizes pawnshop owners
who fail to report their purchases.
Number 1400
LAURA ACHEE, Staff to Representative Ralph Samuels, Alaska State
Legislature, explained that a class A misdemeanor is a stiffer
penalty than what is currently in statue. She explained that
this section of existing law is antiquated; bills no longer
detail specific penalties, but rather, they reference the
criminal statutes where the penalties are outlined. Law
enforcement officers told her that a class A misdemeanor is more
appropriate than the existing, more lenient penalties.
Number 1477
REPRESENTATIVE ROKEBERG commented that a class A misdemeanor is
punishable by up to one year in jail and $5,000 in fines, so
this is an enormous increase in penalty. The original law may
date back to 1949 when the generic term misdemeanor was in use
and before it was classified into A, B, and C. He opined that
the fine being removed in HB 66 is in the class C or least
serious range. This bill uses the term "reckless", which is a
higher standard than a mere failure to report. "Reckless"
behavior would have to be blatant to be successfully prosecuted.
Number 1546
REPRESENTATIVE DAHLSTROM asked Mr. Mew if other states require
pawnshops to report sales and to be licensed. She also asked
about the cost of the licensing and whether it has been
successful. She questioned whether the only cost to pawnshop
owners is access to the Internet.
MR. MEW replied that most cities and states across the country
require pawnshops to report their purchases, and most police
departments have detectives working a pawn detail. He said the
extent to which each jurisdiction uses computer technology
varies widely. This particular software is free to law
enforcement agencies and free to the pawnshops and secondhand
stores, but the customer pays a $.50 or $1 surcharge, so it's
the customer who pays for the system. But there are a variety
of models. Some software companies sell the product to the
police department, which makes it free to the pawnshop or
charges the pawnshop. Some places, like Anchorage, are not
automated, and the pawnshops give the police the information on
a disk and the police absorb the cost of massaging the data.
This bill doesn't lock the pawnbrokers into accepting anybody's
particular solution. Internet access is the only thing required
for the pilot project in Anchorage and Juneau. The bill doesn't
require the pawnshops to automate - only to report to the police
department.
Number 1682
REPRESENTATIVE CRAWFORD asked about the language on page 3, line
28, and whether the requirement for government identification
should include the word "photographic". He also asked how
pawnshops record those items whose serial numbers have been
removed. In his experience, some ironworker contractors retool
their jobs by buying tools from pawnshops; many times the tools'
serial numbers have been defaced.
Number 1736
REPRESENTATIVE SAMUELS answered that if the serial number is
missing from an item, the pawnshop records other identifying
details.
Number 1749
MR. MEW added that pawnshops often deal with nonserialized
property and with items missing their serial numbers. A missing
serial number is a hallmark that the property has been stolen,
and that should raise the pawnbroker's suspicions. Removing a
serial number from a firearm is a crime, but it's not a crime to
remove it from a Walkman [a pocket-sized cassette player]. If
the pawnshop owners can't enter a serial number, they can still
enter the make, model, style, and size. The APD can still do
hits with that information. This other identifying information
is still a powerful tool, and allows the Anchorage Police
Department to narrow a field of thousands of items down to a few
that they then look at in pawnshops. He said they often do
prepare court cases without serial numbers.
Number 1819
MR. MEW, in response to a question from Representative Crawford,
said he favors making it illegal to trade goods that are missing
their serial numbers.
MR. MEW responded to a question from Representative Rokeberg
about BWI [Business Watch International], the software company
in partnership with the Canadian government and based in
Saskatchewan. The company approached the pawnshops, gave them a
software presentation, and asked if they'd like to try it out.
BWI is paying the cost. Pawnshops don't have to charge the
clients a fee, nor do they have to pay a fee to the police
department. Mr. Mew said that BWI probably hopes to capitalize
on the market if the statute passes. But, he added, the bill
doesn't dictate which software to use.
Number 1998
MR. MEW answered Representative Rokeberg's query about the
exemptions in Anchorage's municipal ordinance. He said only
secondhand stores are exempted in Anchorage, but the original
ordinance required all pawnshops and secondhand stores to
report. Anchorage doesn't require used car dealers to report
their sales because they already report to DMV.
Number 2022
REPRESENTATIVE ROKEBERG protested the selective enforcement of
state law under which pawnshops must report but used car
dealers, Salvation Army, Goodwill, antique brokers, and
secondhand dealers are ignored.
Number 2037
MR. MEW explained that stores like Goodwill are exempt because
they do not pay for the merchandise they sell. Neither HB 66
nor the city ordinance requires stores like Salvation Army to
report; only the stores that purchase property have to report.
He said it is true that the Anchorage Police Department
selectively enforces the municipal ordinance, and the department
isn't always happy about the situation but the department is
following the direction given by several administrations. Mr.
Mew said he believes that by encouraging pawnshops and
secondhand stores to use streamlined technology, his department
could handle more groups required to report under state law
without increasing staff.
MR. MEW answered Representative Rokeberg's question about how
secondhand dealers gained exemption under Anchorage's municipal
ordinance. When the ordinance was revised, no one in the APD
realized there already was a state law requiring secondhand
stores to maintain records. Neither the state nor the
municipality is monitoring this information from secondhand
stores. This bill, coupled with the right technology, might
change that, he said.
Number 2168
REPRESENTATIVE ROKEBERG noted that Anchorage is the largest law
enforcement agency in the state. He asked how many staff
investigate property crimes and follow up with pawnbrokers.
MR. MEW answered that three or four detectives and two clerks
work full-time with pawnshops and on general theft cases.
Another four detectives have occasional business with the pawn
system.
Number 2245
MATT LEVEQUE, Lieutenant, Division of Alaska State Troopers,
Department of Public Safety, testified that the department
conceptually backs HB 66. He said the department supports any
action that gets property back into the hands of victims faster
and allows the state to prosecute those who have stolen the
property.
MR. LEVEQUE identified several issues of concern to the
Department of Public Safety. The bill repeals the requirement
that the pawnshop record the sale of the goods, and he said he
suspects this is an oversight. Repealing this requirement
removes the opportunity for police to follow up on cases that
have passed the 30-day hold period. When the property has been
subsequently sold, it can still be recovered from the good-faith
purchaser. His other concern is with how the department would
upload information to this Internet system. He said it is
unknown whether APSIN [Alaska Public Safety Information Network]
would be compatible with whatever software is used. Also, if
pawnbrokers and secondhand stores provide their reports on disk
or on the serialized three-part forms, the department would need
staff to input the data and make it usable.
Number 2319
MR. LEVEQUE, in answer to Representative Rokeberg's question,
said that if the troopers received a disk today, they could not
match the information with the troopers' current system of
tracking pawnshops. He understands that the vendor would
provide the software to police agencies at no cost, but the cost
of the system would be borne by the pawnshop customer.
REPRESENTATIVE ROKEBERG described this cost to the pawnshop
customer as a private fiscal note.
TAPE 03-5, SIDE B
Number 2371
JERRY CLEWORTH, Owner, Alaska Rare Coins, identified himself as
Fairbanks businessman and a city council member. He said he
represents a group of downtown businesses that are strongly
opposed to HB 66. These businesses are: Alaskan Photographic
Repair Service, Gold Dust Antiques, Alaska Gold 'N' Gems,
Alaskan Gold Rush Jewelry, Caribou Loan, TCR Ivory, Arctic
Traveler's Gift Shop, and New Horizons Gallery. Mr. Cleworth
said the bill would impact every business that buys secondhand
goods, basically every retail business in downtown Fairbanks.
None of these businesses were aware of an existing law that
requires that they record their purchases.
MR. CLEWORTH said that without definitions, he has to assume
that any previously owned item must be listed, whether purchased
from an estate sale, an auction, or a personal collection. Mr.
Cleworth asked if he would have to list every item in a
collection of 1,000 coins. "I don't have the time," he said,
and he called the requirement absurd. He described the holding
period of 45 days as outrageous, because many small businesses
operate on limited capital and small margins. He explained that
his business deals in gold and silver, but he's not sure if he
qualifies as a commodities broker under HB 66. For example, if
someone sells him 100 ounces of a precious metal at today's spot
price and he sits on the purchase for 45 days, he'd certainly go
broke. He asked if the bill applies to items such as gold coins
that aren't traded on the commodities market but whose prices
fluctuate vastly from day to day.
Number 2200
MR. CLEWORTH also asked how the bill affects other secondhand
goods purchased at garage sales, over the Internet, at church
bazaars, and at flea markets. He pointed out that all the
testimony today has involved pawnshops. If the problem has been
pawnshops buying stolen goods, he suggested then working with
that industry and getting it automated. Mr. Cleworth testified
that in his 23 years of business, he had only one incident of
stolen goods, and it involved members of the same family.
CHAIR ANDERSON told the witnesses that the committee is taking
testimony today but the bill will be held over while the
sponsor, Representative Samuels, continues work on it.
Number 2165
MR. CLEWORTH, in response to Representative Rokeberg's question,
replied that the 30- and 45-day holding periods and the
reporting requirements in HB 66 are troublesome. He physically
cannot comply with the reporting requirements of the bill unless
he uses a generic listing of "a coin collection purchased from
Joe Blow." If he ties up $50,000 or $100,000 for 45 days, he
would have to get a loan.
Number 2076
JOHN SHACKLEY, Owner, [Rocket Surplus], a military surplus
store, clarified earlier testimony, saying that Value Village is
a profit-making business that purchases merchandise. He
testified that the 15-day break on the required hold time is not
much of an incentive to automate. If he collects the data
manually, his customers wouldn't have to pay the software
surcharge. So only a few pawnshops would be paying for it. He
predicted that the data collection system will work only if
every police agency in Alaska has the same system and it's given
to them at no charge. Those pawnshops that automate would end
up carrying the cost of the system.
Number 2020
MR. SHACKLEY protested that asking any retail store to hold its
merchandise for over 30 or 45 days is ridiculous. Businesses
work on a 30-day net; his vendors give him 30 days to sell the
merchandise and pay them. He asked: If he buys an item at a
yard sale or an auction, does he insist the seller fill out a
form? How does a merchant distinguish one pair of bunny boots
from another? The bill requires that the seller have proof of
ownership. If a man walks into his shop to sell him a military
uniform, what are the identifying marks and what proof can the
man show of ownership? He said this bill poses many problems,
and he said he definitely opposes HB 66.
Number 1938
MR. SHACKLEY, answering Representative Guttenberg's question,
said that very little of his merchandise has serial numbers or
unique identifying marks.
MR. SHACKLEY responded to Representative Rokeberg's question
about whether he buys merchandise, such as military surplus, in
lots. He replied that he buys from DRMOs [Defense Reutilization
and Marketing Offices], from big vendors in the Lower 48, and
from people who buy from DRMOs. He explained that he buys some
items in lots of 100 or 200.
Number 1900
BILL HOYT, Wasilla Pawn Shop, questioned the meaning of current
law on page 5, lines 24-27, which deals with reselling pawned
items and paying the previous owner.
Number 1821
CONRAD HOLLER, Rainbow Pawn Shop, asked how he would report the
purchase of a large toolbox of 1,600 wrenches with no serial
numbers.
Number 1786
JOHN MINNICK, A-1 Pawn, said he is traveling to Juneau on
Sunday, February 9, and hopes to talk to legislators about
suggested changes to HB 66.
Number 1756
MR. HOLLER, Rainbow Pawn Shop, asked whether sports shops, which
take guns in trade, will be required to hold them for 45 days
and report these transactions under HB 66. If someone places an
item with him on consignment, does he have to hold it for 45
days? If merchants have to keep an item for 45 days, they will
have to reduce the amount they pay for an item. Some of these
customers are legitimate; they don't have any money, they're
down and out, and they need what they can get. Mr. Holler noted
that the state law and the Anchorage ordinance are not broken
and don't need fixing.
Number 1645
DEBORAH FINK, Owner, Cash Alaska, Anchorage, testified that she
has operated her business since 1989, and her four stores
comprise the largest pawn business in the state. She said she
supports state legislation to retrieve stolen goods. She has
lived under the Anchorage pawnshop code for some time and is
used to the time and detail required. She said this legislation
is an opportunity for the industry and the public to address
this issue. She emphasized that she would like to be involved
in the dialogue on HB 66 and was glad to hear the committee
won't be moving the bill today. She complained about the pawn
industry's bad image. Of the $4 million she paid out in loans
and purchases in 2002, the average amount was $79. Her company
made 54,751 sales and loans for the year. Of all the money paid
out, only $2,000 in merchandise was confiscated by a law
enforcement agency. Another $15,000 in merchandise was
returned, at her own expense, to the people who claimed the
items as their property. This $17,000 in stolen property
amounted to one-third of one percent of her total business.
Number 1540
MS. FINK explained that pawnshops provide fast money. They fill
a niche, the $79 loan, a service in which banks and credit
unions have no interest. Approximately 70 percent of her
customers reclaim their items; they come in over and over again;
and the vast majority of her customers are honest people. She
said her company has worked well with APD for many years. It's
reasonable for anyone who deals in used goods to be subject to
state regulation because these businesses are going to get some
stolen goods.
MS. FINK said she supports this legislation in general and said
she thinks she could live with HB 66 with a few minor changes.
She said it is similar to what she already does.
Number 1413
REPRESENTATIVE GATTO asked Ms. Fink where she thinks the stolen
goods are going if not to the pawnshops.
MS. FINK, answering Representative Gatto's question, said she
heard several years ago from the Anchorage Police Department
that that only 3 percent of stolen items were ever recovered,
mostly from pawnshops. Police working the pawn detail more
recently indicated that some stolen items were going into
permanent garage sales, that stolen jewelry was being placed in
jewelry stores, and that most guns were being sold on the street
or in secondhand stores.
REPRESENTATIVE GATTO asked Ms. Fink to explain her business's
$79 average transaction.
MS. FINK replied that the $79 [an average for loans and
purchases] is the purchase amount, the amount given to the
customer. The maximum purchase is $500, but she said the bulk
of her loans were under $100.
Number 1292
MS. FINK replied to a series of questions from Representative
Rokeberg. She explained that the $500 pawn limit is part of the
Alaska Small Loan Act [AS 06.20.330(b)]. She said it's very
low, even though it was raised from $200 five or six years ago.
She said that when people bring in something worth a lot of
money, she can't give them a fair deal. She'd support raising
the $500 limit.
MS. FINK said she doesn't think the selective enforcement on
pawnshops is fair, but if the primary objective is recovering
stolen goods, fairness isn't so much the question. She said the
question is what is the reasonable thing to do to recover stolen
goods in the secondhand industry. She added that most people in
the pawn industry don't think that furniture or clothing ought
to be reported. Reporting should be required for any serial-
numbered items, for higher-end jewelry, and for weapons. She
said she is very sympathetic to the people who have testified
today.
Number 1154
MS. FINK said that if there were a higher loan limit, most
jewelry would continue to go to jewelry stores on consignment,
where there's no up-front money paid to the seller. She said
her customers would like a higher pawn limit because she could
give them a better value for expensive items.
REPRESENTATIVE ROKEBERG invited Ms. Fink and other speakers to
help the sponsor of HB 66 determine what items are appropriate
to exempt from the law. He said legislators don't want to force
people into reporting inappropriate items, such as baby clothes.
He said that people won't abide by bad laws.
MS. FINK responded that deciding what to report should be based
on what the police report as stolen.
Number 1021
JEFF GREGG, Detective, Theft Section, Anchorage Police
Department, Municipality of Anchorage, described his work with
the pawn system. He recounted specific examples of stolen
property going outside Anchorage and several instances of
tracking down suspects and stolen property through the pawn
system. Mr. Gregg surmised that Anchorage secondhand stores may
have considerable stolen goods, but their owners do not realize
it because the items are not being checked against any
databases.
Number 0827
REPRESENTATIVE GUTTENBERG asked Mr. Gregg how he deals with
items that don't have serial numbers or other identifying marks,
such as bunny boots, children's clothing, and furniture. And he
asked how he profiles people who commit crimes with these items.
MR. GREGG gave the example of a business owner reporting that an
employee had stolen certain tools. Mr. Gregg checked that name
in the database to see if the individual had pawned any items,
and found several items the employee had pawned. The detective
then visited the pawnshop, took photos of the items, made
contact with the victim of the crime, and got as many details as
possible about the stolen items.
MR. GREGG told Representative Guttenberg that he's not
personally aware of any illegal activity at the many ongoing
garage and yard sales. He also said he was not familiar with
any studies of stolen goods being transported out of state.
Number 0654
MR. MEW testified that yard sales are not a problem in marketing
stolen goods because those items are sold as bargains. He
proposed that law enforcement work with the secondhand industry
to come up with protocols for recording collections of items,
for example, a box of tools or a coin collection. The company
demonstrating the pawn software is developing a camera that will
allow the pawnbroker to take digital photographs and attach them
to the record. Looking at the photos could help the police
decide whether to further investigate those items. He said this
is one example of a technological solution.
REPRESENTATIVE SAMUELS concluded his presentation, saying the
point is to return stolen goods to the victims, not monitor
garage sales. He indicated his willingness to work with the
industry to alleviate some of their concerns.
Number 0477
REPRESENTATIVE ROKEBERG summarized key issues raised in today's
testimony. He said be believes people are not adhering to the
current statute because it is broken. He said there is
selective enforcement because many of these businesses should be
exempt from the law. There's an important interplay between the
Alaska Small Loan Act and the $500 loan cap. The company
marketing the software, BWI, might have comments about the pilot
project and some useful national perspectives. Representative
Rokeberg added that it's important to understand the costs of
implementing an automated data collection system. If this
software isn't compatible with the Alaska State Troopers'
system, HB 66 may have a big price tag for new hardware and
software.
REPRESENTATIVE ROKEBERG also noted the problem of creating a
penalty for nonreporting by pawnbrokers. Not recording pawn
purchases was previously a class B or C misdemeanor, and this
bill turns failure to report into a class A misdemeanor, a
criminal action. Representative Rokeberg said HB 66 is a
licensing procedure, and its penalties should be similar to
those of other licensed businesses regulated by the Division of
Occupational Licensing. He also noted that the bill adds the
term "recklessly" as a standard of proof. He volunteered to
work with the sponsor of HB 66 on these issues.
CHAIR ANDERSON announced that HB 66 will be held for further
public hearing.
ADJOURNMENT
There being no further business before the committee, the House
Labor and Commerce Standing Committee meeting was adjourned at
4:45 p.m.
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