Posted on: 6 April 2015
Pawn shops have been around for thousands of years. In fact, they can be tracked back to ancient China, Greece, and Rome. However, it wasn't until the mid-18th Century in England that Parliament deciding that it was time to regulate these businesses. While the popular television show Pawn Stars shows a simplified process of business, there are a lot of laws that shops must follow, and there is a lot of paperwork behind the scenes.
The General Process
There is a general process that each pawn shop goes through to protect themselves and the seller of each item before they buy any merchandise. Almost every pawn shop has some sort of authentication tools for jewelry, especially diamonds, right there on site. This way, they can know exactly the quality and value of an item before they make an offer. Each broker will carefully look over any item though to ensure quality.
After they do their initial inspection, they will offer a price. The seller can take the price or they are free to take the item to another location to see if they can get a better price. Once a sale is put in motion, the real work starts in order to comply with federal and state laws.
There is an entire list of laws that pawn shops must adhere to on the federal level.
- Any information about the seller that isn't already public must be protected.
- All public information must be verified, like your name and address. All of this is compared to your government-issued picture ID to ensure you are not a terrorist.
- Buying or selling a firearm includes a background check and a different set of records.
- Agreements must all be carefully explained and detailed so that the seller understands them as well.
The bulk of laws come from individual states which are going to differ.
- Some states require that all purchases are reported to the local police so they can keep an eye out for anything matching stolen property reports.
- In other states, if you have merchandise stolen and file a report, you can search inventory at local pawnshops yourself. This is especially effective in states where the shop is required to have a grace period where they don't sell your items, in case you change your mind.
- The issuing of pawn tickets for all items bought and sold to cover themselves in cases of crime.
As you can see, there are many different laws that pawn brokers must know and adhere to in order to keep their business clean and you, the consumer, safe. For more information, speak with experts like Desert Jewelry Mart & Coins.Share