44TH LEGISLATURE - STATE OF NEW MEXICO - FIRST SESSION, 1999
RELATING TO BUSINESS REGULATION; ENACTING THE PAWNBROKING ACT; REGULATING THE BUSINESS OF PAWNBROKERS; REQUIRING STATE LICENSING OF PAWNBROKERS; PROVIDING PENALTIES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
Section 1. SHORT TITLE.--This act may be cited as the "Pawnbroking Act".
Section 2. DEFINITIONS.--As used in the Pawnbroking Act:
A. "agency" means the financial institutions division of the regulation and licensing department, its director or an employee of the division acting pursuant to properly delegated authority from the director; B. "amount financed" means the amount of money advanced to a pledgor in a pawn transaction;
C. "appropriate law enforcement official" means the administrative head of the law enforcement entity having law enforcement jurisdiction in the geographical location of a pawnshop;
D. "beneficial owner" means a person not having legal title to property but having rights in the property that are the usual incidents of ownership;
E. "claimant" means a person who claims that his or her property was misappropriated;
F. "conveying customer" means a person who delivers property into the custody of a pawnbroker by pawn, sale, consignment or trade;
G. "default date" means the next business day following the date on which the pledgor's right to redeem property expires;
H. "hold order" means a written direction executed by the appropriate law enforcement official imposing a holding period on property in the possession of a pawnbroker during which neither possession nor title to the property may be transferred;
I. "identification" means a government-issued photographic identification signed by the person identified or an electronic image of that document;
J. "maturity date" means the date occurring thirty days after the date of the pawn transaction;
K. "misappropriated" means stolen, embezzled, converted or otherwise wrongfully appropriated without permission of the rightful owner of the property;
L. "net worth" means a person's total assets less the person's total liabilities as those terms are defined by generally accepted accounting practices;
M. "operator" means a person who has charge of an entity or has control of its business or of its establishments, divisions or departments and who has some amount of discretion and independent judgment in taking actions on behalf of the entity;
N. "pawn" means the advancement of money to a person conditioned upon that person transferring possession of property to the person advancing money, pledging the property as security for the advancement and having the right to redeem the property on or before the duration of the pawn upon performance of terms and conditions agreed to in writing by the parties;
O. "pawn service charge" means a charge that includes:
(1) interest on the money advanced in a pawn;
(2) costs of investigating the title of the pledged property; and
(3) costs of storage of and insurance on the pledged property.
"Pawn service charge" does not include a governmental tax or fee imposed on the pawnbroker that may be passed on to the pledgor;
P. "pawnbroker" means a person who:
(1) engages in the business of making pawns;
(2) makes a public display containing the words "pawn", "pawnbroker" or "pawnshop" or any derivative of those words; or
(3) displays to the public a sign or symbol historically identified with pawns;
Q. "pawnbroker transaction form" means the instrument on which a pawnbroker records pawns;
R. "pawnshop" means the location at which a pawnbroker conducts business;
S. "person" means an individual or other legal entity;
T. "pledged goods" means tangible personal property deposited with or otherwise delivered into the possession of a pawnbroker as security for advancement of money;
U. "pledgor" means a person who delivers pledged goods into the possession of a pawnbroker in a pawn transaction; and
V. "purchase" means the simultaneous transfer of title to and possession of property to a pawnbroker by a person who is transferring the title for the pawnbroker's acquisition for value, consignment or trade for other property.
Section 3. LICENSE REQUIRED.--
A. A person shall not engage in business as a pawnbroker unless the person has a valid license issued by the agency. A separate license is required for each pawnshop. The agency shall issue more than one license to a person if that person complies with the requirements for each license.
B. A licensee who moves a pawnshop to another location shall mail written notice of the change of location to the agency and the appropriate law enforcement official at least thirty days prior to the intended move, and the agency shall then amend the license to indicate the new location.
C. A license remains in effect until it is relinquished, suspended or revoked or it expires. All licenses expire on June 30 of the calendar year following the calender year in which issued. The agency may adopt a rule providing for proration of the license fee when issued for less than twelve months. The amount of the license fee for initial issuance of a license shall be not more than five hundred dollars ($500) for each license. A licensee shall pay annually to the agency a license renewal fee not to exceed three hundred fifty dollars ($350) for each license held. The renewal fee is due no later than the date of expiration of the license being renewed. If the annual license fee remains unpaid thirty days after written notice of delinquency is mailed to the licensee by the agency, the license shall expire automatically on that date.
D. A temporary license may be issued under the provisions of this section and shall remain in effect until the agency issues a permanent license or the application is denied. The agency may issue a temporary pawnbroker's license for the operation of a pawnshop upon receipt of an application to:
(1) transfer an existing license from one person to another; or
(2) issue a license when the applicant is an existing licensee.
E. A licensee shall apply to the agency for a new license or for a temporary license upon any change, directly or beneficially, in the ownership of a pawnshop unless one or more holders of at least a majority of the equity interest of the pawnshop before the change in ownership continue to hold a majority of that equity interest after the change in ownership.
F. Any person applying for or renewing a local business license or registration to engage in business as a pawnbroker must exhibit a current pawnbroker's license from the agency before the local business license or registration may be issued or reissued.
Section 4. ELIGIBILITY FOR LICENSE.--
A. To be eligible for a pawnbroker's license, an applicant shall:
(1) have a net worth of at least fifty thousand dollars ($50,000) established pursuant to generally accepted accounting practices or file with the agency a bond issued by a surety company holding a certificate of authority from the superintendent of insurance to do business in this state in the amount of ten thousand dollars ($10,000) for each license;
(2) not have been convicted or found guilty of, or pled guilty or nolo contendere to, regardless of
adjudication, a felony within the last ten years and not be acting as a beneficial owner for someone who has been convicted or found guilty of, or pled guilty or nolo contendere to, regardless of adjudication, a felony within the last ten years; and
(3) not have been convicted or found guilty of, or pled guilty or nolo contendere to, regardless of adjudication, within the last ten years, a crime that the agency finds directly relates to the duties and responsibilities of a pawnbroker and not be acting as a beneficial owner for someone who has been convicted or found guilty of, or pled guilty or nolo contendere to, regardless of adjudication, within the last ten years, a crime that the agency finds directly relates to the duties and responsibilities of a pawnbroker.
B. In lieu of the bond requirement in Paragraph (1) of Subsection A of this section, the applicant may establish a certificate of deposit or an irrevocable letter of credit in a New Mexico banking institution in the amount of the bond. The original bond, certificate of deposit or letter of credit shall be filed with the agency. The agency shall be the beneficiary of the bond, certificate of deposit or letter of credit. The bond, certificate of deposit or letter of credit shall be in favor of the agency for the use and benefit of any consumer who is injured by the fraud, misrepresentation, breach of contract, financial failure or violation of any provision of the Pawnbroking Act by the pawnbroker. The liability on the bond may be enforced by filing a suit in a court of competent jurisdiction. The bond, certificate of deposit or letter of credit shall be applicable and liable only for the payment of claims duly adjudicated by order of the court. The bond, certificate of deposit or letter of credit shall be payable on a pro rata basis as determined by the court if the aggregate amount of claims exceed the amount of the bond, certificate of deposit or letter of credit, but the aggregate amount paid may not exceed that amount.
C. If the agency cannot verify that the applicant meets the net worth requirement for a license, the agency may require a finding, including the presentation of a current balance sheet, by a certified public accountant that the accountant has reviewed the books and records of the applicant and that the applicant meets the net worth requirement.
D. If an applicant is not an individual, the eligibility requirements of this section, other than the requirements of Paragraph (1) of Subsection A of this section, apply to each operator of the pawnshop and to each direct or beneficial owner of at least thirty-five percent of the equity interest of the pawnshop and, if the applicant is a corporation, to each officer and director of the corporation.
Section 5. APPLICATION FOR LICENSE.--
A. An application for a pawnbroker's license, for the transfer of an existing pawnbroker's license or for the approval of a change in the ownership of a licensee's pawnshop shall be verified by the individual signing it and shall state the full name and place of residence of the applicant, the place where the business is to be conducted and other relevant information required by the agency.
B. If the applicant is not an individual, the application shall include the full name and address of each direct or beneficial owner of at least a ten percent equity interest in the applicant, and if the applicant is a corporation, the application shall also state the full name and address of each officer and director unless the corporate applicant is owned directly or beneficially by a person that as an issuer has a class of securities registered under Section 12 of the federal Securities Exchange Act of 1934, or under Section 15(d) of that act, is an issuer of registered securities required to file reports with the securities and exchange commission and files with the agency the information, documents and reports required to be filed with the securities and exchange commission.
C. Each application for a license shall be accompanied by an application fee set by the agency not to exceed five hundred dollars ($500) for the first location applied for, and if the application includes additional locations, not to exceed three hundred fifty dollars ($350) for each additional location. The amount of this fee shall be sufficient to cover the license fee for the first year's operation, the actual cost for fingerprint analysis for each owner application and the costs of investigating the applicant. Application fees are not refundable. The agency shall adopt reasonable rules to provide for waiver of fingerprint analysis or background investigation, or both, in those cases in which the applicant has on record with another state office or a federal office current fingerprint analysis and background investigation data.
D. When the application and the required fee are received, the agency shall investigate the facts, approve the application and issue a license to the applicant if the agency finds that the eligibility requirements for the license are satisfied. The license must be prominently displayed in a place in the pawnshop that is readily and easily observable by business customers.
E. The agency shall take action to issue or deny issuance of a license within sixty days of the date of application. If no action is taken within that time period the license is deemed approved unless the agency notifies the applicant of an extension of the application period for a definite time based upon reasonable cause found by the agency. F. Fees collected pursuant to this section by the agency shall be deposited into the general fund.
Section 6. DISCIPLINARY ACTION BY AGENCY AGAINST LICENSEE--APPLICATION OF PROVISIONS OF UNIFORM LICENSING ACT--VOLUNTARY SURRENDER OF LICENSE.--
A. The agency may enter an order imposing one or more of the penalties set forth in Subsection B of this section if the agency finds that:
(1) a licensee violated or is operating in violation of a mandatory or prohibitive provision of the Pawnbroking Act or of the rules adopted or orders issued pursuant to that act or has aided or conspired with another person to violate such a provision;
(2) a licensee made a material false statement in any application, document or record required to be submitted or retained under the Pawnbroking Act;
(3) a condition exists that, had it existed when a license was issued, would have justified the agency's refusal to issue a license;
(4) a licensee refused or failed, or any of its principal officers refused or failed, after notice, to produce any document or records or disclose any information required to be produced or disclosed under this section or the rules of the agency;
(5) a licensee made a material false statement in response to any request or investigation by the agency or the attorney general; or
(6) a licensee intentionally defrauded the public through dishonest or deceptive means.
B. Upon a finding as set forth in Subsection A of this section, the agency may:
(1) impose an administrative fine not to exceed one thousand dollars ($1,000) for each act by a licensee that constitutes a violation of a mandatory or prohibitive provision of the Pawnbroking Act or a rule or an order issued pursuant to that act;
(2) direct that a licensee cease and desist specified activities;
(3) revoke or suspend a license;
(4) place a licensee on probation for a period of time, subject to those conditions specified by the agency; or
(5) issue a formal written reprimand to a licensee.
C. An administrative proceeding that could result in the entry of an order imposing a penalty specified in Subsection B of this section is governed by the provisions of the Uniform Licensing Act.
D. If the agency has reasonable cause to believe that a person is operating in violation of the Pawnbroking Act, the agency may bring a civil action seeking temporary or permanent injunctive relief and other appropriate civil relief, including a civil penalty not to exceed five thousand dollars ($5,000) for each violation, restitution and damages for injured customers, court costs and reasonable attorney fees in the district court for the county in which the violation is alleged to be occurring. An action brought pursuant to this subsection is barred unless commenced within two years of the date of the violation.
E. The agency may terminate an investigation or action commenced pursuant to this section upon agreement by the offender to pay a stipulated civil penalty, make restitution or pay damages to customers or satisfy any other relief authorized in this section.
F. The remedies provided for in this section are in addition to any other remedy provided by law.
G. A licensee may surrender a license by mailing it to the agency with written notice of its surrender. The surrender of a license does not affect the civil or criminal liability of the licensee for acts committed before the surrender of the license.
H. The revocation, suspension or surrender of a license does not impair or affect the obligation of any preexisting lawful contract between the licensee and any pledgor. Any pawn transaction made by a person not licensed as a pawnbroker is voidable, in which case the person forfeits the right to collect any money, including principal and any charges, from the pledgor in connection with the transaction and is obligated to return to the pledgor the pledged goods in connection with the transaction.
I. The agency may reinstate a suspended license or issue a new license to a person whose license has been revoked if after a hearing it determines that no fact or condition then exists that would have justified the agency in originally refusing to issue a license.
Section 7. PAWNBROKER TRANSACTION FORM.--
A. At the time a pawnbroker enters into any pawn or purchase transaction, the pawnbroker shall complete a sequentially numbered pawnbroker transaction form for the transaction, including an indication of whether the transaction is a pawn or a purchase, and the pledgor or seller shall sign the completed form. The agency shall design an approved pawnbroker transaction form. The agency shall include designated entries on the form for at least the following information:
(1) the name and address of the pawnshop;
(2) except for items that are identical or substantially similar, do not bear serial or model numbers, do not contain precious metal or gemstones and are not firearms, which items may be described by quantity and a single general description using easily understood laymen's terms, a complete and accurate description of the pledged goods or purchased goods, including the following information for each item, if applicable:
(a) brand name;
(b) model number;
(c) manufacturer's serial number;
(e) color, as apparent to the untrained eye;
(f) precious metal type, weight and content, if known;
(g) gemstone description in nontechnical language, including the type and approximate number of stones;
(h) in the case of firearms, the type of action, caliber or gauge, number of barrels, barrel length if under eighteen inches and finish;
(i) any other unique identifying marks, numbers, names or letters; and
(j) in the case of Native American jewelry and artifacts, a description that is normally accepted in the trade or culture;
(3) the name, address, home telephone number, date of birth, physical description and right thumbprint of the pledgor or seller;
(4) the date and time of the transaction;
(5) the type of identification accepted from the pledgor or seller, including the issuing agency and the
(6) in the case of a pawn:
(a) the amount of money advanced, which must be designated as the amount financed;
(b) the maturity date of the pawn;
(c) the date on which the pledgor's right to redeem pledged property expires, which shall be thirty days after the maturity date of the pawn, or the next business day after the thirtieth day if the thirtieth day is not a business day, and the amount due on that date;
(d) the pawn service charge payable on the maturity date, which must be designated as the finance charge;
(e) the amount financed plus the finance charge that must be paid to redeem the pledged goods on the maturity date, which must be designated as the total of payments;
(f) the annual percentage rate, computed according to the applicable regulations adopted by the federal reserve board pursuant to the federal Truth in Lending Act; and
(g) a statement on the front or back of the pawnbroker transaction form that notifies the pledgor that: 1) any personal property pledged to a pawnbroker within this state that is not redeemed by the date the pledgor's right to redeem expires is forfeited on the default date to the pawnbroker, and absolute right, title and interest in and to the property vest in and are deemed conveyed to the pawnbroker by operation of law, and no further notice is necessary; 2) the pledgor is not obligated to redeem the pledged goods; 3) if the pawnbroker transaction form is lost, destroyed or stolen, the pledgor must immediately advise the issuing pawnbroker by mail or in person evidenced by a signed receipt; and 4) a pawn may be extended upon mutual agreement of the parties;
(7) in the case of a purchase, the amount of money paid for the goods or the monetary value assigned to the goods in connection with the transaction; and
(8) a statement signed by the pledgor or seller before a witness or a notary that the pledgor or seller of the item represents and warrants that it is not stolen, that it has no liens or encumbrances against it, that it is not the subject of an outstanding pawn transaction and that the pledgor or seller is the rightful owner of the goods and has the right to enter into the transaction.
B. A pawnbroker shall use a form that is substantially similar to the agency-approved form and that contains entry spaces designating all of the required information specified in Subsection A of this section. However, a pawnbroker's form may be formatted to conform to his business systems and may contain additional information.
Section 8. RECORD KEEPING--REPORTING.--
A. A pawnbroker shall maintain a copy of each completed pawnbroker transaction form on the pawnshop premises for at least one year after the date of the transaction. On a weekly basis, the pawnbroker shall deliver to the appropriate law enforcement official a compiled report or copies of the pawnbroker transaction forms for each of the transactions occurring during the previous business week. Other arrangements for reporting may be agreed upon between the pawnbroker and the appropriate law enforcement official. The pawnbroker may delete or block out information disclosing the amount of a pawn transaction on the copy of the pawnbroker transaction form furnished. When an electronic image of a pledgor or seller identification is accepted for a transaction, the pawnbroker shall maintain the electronic image in order to meet the same record keeping requirements as for the original transaction form. If a criminal investigation occurs, the pawnbroker shall, upon request, provide a clear and legible copy of the image to the appropriate law enforcement official.
B. If the appropriate law enforcement agency supplies the software and the pawnbroker has computer capability, pawn transactions shall be electronically transferred. If a pawnbroker does not presently have computer capability, the appropriate law enforcement agency may provide the pawnbroker with a computer and all necessary equipment for the purpose of electronically transferring pawn transactions. The appropriate law enforcement agency shall retain ownership of the computer unless otherwise agreed upon. The pawnbroker shall maintain the computer in good working order, ordinary wear and tear excepted. In the event the pawnbroker transfers pawn transactions electronically, the pawnbroker is not required to also deliver to the appropriate law enforcement official the original or copies of the pawnbroker transaction forms. The appropriate law enforcement official may, for the purposes of a criminal investigation, request that the pawnbroker produce an original of a transaction form that has been electronically transferred, and the pawnbroker shall deliver this form to the official before the close of the next business day.
C. All goods delivered to a pawnbroker in a pawn transaction must be securely stored and maintained in an unaltered condition within the jurisdiction of the appropriate law enforcement official for a period of thirty calendar days after the transaction unless redeemed earlier by the original pledgor. The pawnbroker shall make records relating to pledged goods available for inspection by the appropriate law enforcement official during normal business hours throughout the period. The pawnbroker must store and maintain pledged goods for the period prescribed in Section 9 of the Pawnbroking Act unless the pledged goods are redeemed earlier by the holder of the original pawn ticket.
D. Each item pledged in a pawn transaction shall have attached to it a tag with an alphabetic or numeric identification matching that item with its corresponding pawnbroker transaction form.
Section 9. PLEDGED GOODS NOT REDEEMED.--Pledged goods not redeemed by the pledgor on or before the maturity date of a pawn shall be held by the pawnbroker for at least thirty days following that date or until the next business day after the thirtieth day if the thirtieth day is not a business day, which date is the date on which the pledgor's right to redeem the pledged goods expires. Pledged goods not redeemed by that date are automatically forfeited to the pawnbroker on the default day unless an extension is agreed to as provided in Subsection B of Section 10 of the Pawnbroking Act. Absolute right, title and interest in and to the goods vest in and are deemed conveyed to the pawnbroker by operation of law, and no further notice is necessary. A pledgor has no obligation to redeem pledged goods, make any payment on a pawn or spend any of the proceeds from a pawn transaction in the pawnshop.
Section 10. PAWN SERVICE CHARGES.--
A. In a pawn transaction, a pawnbroker may contract for and receive a pawn service charge. The interest component of the pawn service charge is deemed to be fifteen percent of the amount financed for each thirty-day period in a pawn transaction. The pawnbroker may charge any amount of pawn service charge, if the total amount, inclusive of the interest component, does not exceed twenty-five percent of the amount financed for each thirty-day period in a pawn transaction, except that the pawnbroker is entitled to receive a minimum pawn service charge of ten dollars ($10.00) per transaction for each thirty-day period.
B. The date on which the right to redeem pledged goods may be extended to a subsequent date by mutual agreement between the pledgor and the pawnbroker if it is evidenced by a written memorandum, a copy of which shall be supplied to the pledgor, clearly specifying the extended date and the pawn service charges owed on that date. The pawnbroker may require a minimum extension of not more than thirty days. The daily pawn service charge for the extension shall be equal to the pawn service charge for the original thirty-day period divided by thirty days. There is no limit on the number of extensions that the parties may agree to.
C. The total amount of pawn service charges that a pawnbroker may collect in the case of pledged goods redeemed at any time within thirty days after the date of the pawn is the amount provided in Subsection A of this section. The total amount of pawn service charges that a pawnbroker may collect in the case of redemptions occurring at any time more than thirty days after the date of the pawn is twice the amount provided in Subsection A of this section, except that for redemptions occurring more than sixty days after the date of the pawn, pawn service charges continue to accrue from and after the sixtieth day at the daily rate determined as provided in Subsection B of this section. Any unused pawn service charge paid in advance by the pledgor shall be refunded by the pawnbroker.
D. Pledged goods may be redeemed by agreement between the pledgor and the pawnbroker that the pledgor shall mail in advance all money due and a reasonable charge assessed by the pawnbroker to recover his cost and expenses involved in the packaging, insuring and shipping of the pledged goods. The pawnbroker shall ship, mail or otherwise have the goods delivered to the pledgor and shall insure the pledged goods in an amount acceptable to the pledgor. The pawnbroker's liability for loss or damage to the pledged goods is limited to the amount of the insurance coverage obtained.
E. Any interest, charge or fees contracted for or received, directly or indirectly, in excess of the amounts authorized pursuant to this section are prohibited, may not be collected and render the pawn transaction voidable, in which case the pawnbroker shall forfeit the right to collect twice the amount of the pawn service charge contracted for in the pawn and, upon the pledgor's written request received by the pawnbroker within thirty days after the maturity date, shall be obligated to return to the pledgor the pledged goods delivered to the pawnbroker in connection with the pawn upon payment of the balance remaining due, but there shall be no penalty for a violation resulting from an accidental and bona fide error that is corrected upon discovery. Any action to circumvent the limitation on pawn service charges collectible pursuant to this section is voidable. In the event a pledgor makes a partial payment on a pawn that reduces the amount financed, any additional pawn service charges shall be calculated on the remaining balance of the original amount financed.
Section 11. PROHIBITED ACTS.--A pawnbroker, or an employee or agent of a pawnbroker, may not:
A. falsify or intentionally fail to make an entry of any material matter in a pawnbroker transaction form;
B. refuse to allow the agency, the appropriate law enforcement official or the attorney general, or any of their designated representatives having jurisdiction, to inspect completed pawnbroker transaction forms or pledged or purchased goods during the ordinary hours of the pawnbroker's business or other time acceptable to both parties;
C. intentionally obliterate, discard or destroy a completed pawnbroker transaction form sooner than one year after the date of the transaction;
D. accept a pledge or purchase property from a person under the age of eighteen years;
E. make any agreement requiring or allowing the personal liability of a pledgor or the waiver of any of the provisions of this section;
F. knowingly enter into a pawn or purchase transaction with any person who is under the influence of alcohol or controlled substances when the condition is apparent to an unskilled observer;
G. knowingly enter into a pawn or purchase transaction with any person using the name of another;
H. conduct any pawn or purchase transaction at a drive-through window or similar device in which the pledgor or seller remains in a vehicle while conducting the transaction;
I. fail to return or replace pledged goods to a pledgor upon payment of the full amount due the pawnbroker, unless the pledged goods have been placed under a hold order pursuant to Section 15 of the Pawnbroking Act or other applicable state or federal law, taken into custody by a court or otherwise disposed of by a court order;
J. sell or otherwise charge for insurance in connection with a pawn transaction, except in connection with the shipment of pledged goods redeemed by mail as provided in Section 10 of the Pawnbroking Act;
K. engage in a loan transaction at or within a licensed pawnshop location in which the only security for the loan is:
(1) the retention by the lender of possession of the evidence of title to a motor vehicle, commonly referred to as a "title loan transaction"; or
(2) acceptance of a personal check or payroll check, commonly referred to as a "payday loan";
L. lease pledged goods to the pledgor or any other party;
M. operate a pawnshop between the hours of 10:00 p.m. and 7:00 a.m.; or
N. knowingly hire anyone to work in a pawnshop who has been convicted of, or entered a plea of guilty or nolo contendere to, or had adjudication deferred for a felony within the last seven years, or been convicted of, or entered a plea of guilty or nolo contendere to, or had adjudication deferred for a crime within the last seven years that involves theft, larceny, dealing in stolen property, receiving stolen property, burglary, embezzlement, obtaining property by false pretenses, possession of altered property or any fraudulent or dishonest dealing.
Section 12. RIGHT TO REDEEM--LOST PAWNBROKER TRANSACTION FORM.--
A. The holder of a valid pawn ticket is presumed to be the owner of the pledged property and is entitled to redeem the pledged goods described in the pawnbroker transaction form. The person redeeming the pledged goods shall sign the pledgor's copy of the pawnbroker transaction form, which the pawnbroker may retain as evidence of the person's receipt of the pledged goods in good and acceptable condition. If the pledgor has appointed an authorized representative to redeem the pledged goods, that person must present written authorization from the original pledgor and show identification to the pawnbroker, and the pawnbroker shall record that person's name and address on the pawnbroker transaction form retained by the pawnshop.
B. If a pledgor's copy of the pawnbroker transaction form is lost, destroyed or stolen, the pledgor shall notify the pawnbroker in writing either by certified mail, return receipt requested, or personal delivery evidenced by a signed receipt, and receipt of this notice invalidates the pawnbroker transaction form if the pledged goods have not previously been redeemed. Before delivering the pledged goods or issuing a new pawnbroker transaction form, the pawnbroker shall require the pledgor to make a written statement of the loss, destruction or theft of the pledgor's copy of the pawnbroker transaction form. The pawnbroker must record on the written statement the type of identification and the identification number accepted from the pledgor, the date the statement is given and the number of the pawnbroker transaction form that was lost, destroyed or stolen. The statement must be signed by the pawnbroker or the pawnshop employee who accepts the statement from the pledgor. A pawnbroker is entitled to a fee not to exceed ten dollars ($10.00) in connection with each lost, destroyed or stolen pawnbroker transaction form and the taking of a properly prepared written statement.
C. If pledged goods are lost or damaged while in the possession of the pawnbroker, the pawnbroker may satisfy the pledgor's claim by replacing the lost or damaged goods with like kinds of merchandise of equal value, with which the pledgor can reasonably replace the goods. Replacement is a defense to any civil action based upon the loss or damage of the goods.
Section 13. PAWNBROKER'S LIEN.--A pawnbroker has a possessory lien on the pledged goods pawned as security for the funds advanced, the pawn service charge owed and the other charges authorized under the Pawnbroking Act but not for other debts due to the pawnbroker. A pawnbroker has no recourse against a pledgor for payment on a pawn transaction except for the pledged goods themselves. Except as otherwise provided in this section, the pawnbroker must retain possession of the pledged goods until the lien is satisfied or until the default date. The pawnbroker may be compelled to relinquish possession of the pledged goods only after receipt of the applicable funds advanced plus the accrued service charge and other authorized charges, upon court order, or as otherwise provided by law.
Section 14. CLAIMS AGAINST PLEDGED GOODS HELD BY PAWNBROKERS.--
A. To obtain possession of pledged goods held by a pawnbroker that a claimant claims to be misappropriated, the claimant shall notify the pawnbroker in writing, either by certified mail, return receipt requested, or personal delivery evidenced by signed receipt, of the claimant's claim to the pledged goods. The notice shall contain a complete and accurate description of the pledged goods and shall be accompanied by a legible copy of the applicable law enforcement agency's report on the misappropriation of the property. If the claimant and the pawnbroker do not resolve the matter within ten days after the pawnbroker's receipt of the notice, the claimant may petition a court of competent jurisdiction to order the return of the property, naming the pawnbroker as a defendant, and must serve the pawnbroker with a copy of the petition. The pawnbroker shall hold the property described in the petition until the right to possession is resolved by the parties or by the court. The court shall waive any filing fee for the petition to recover the property, and the sheriff shall waive the service fees.
B. If, after notice and a hearing, the court finds that the property was misappropriated and orders the return of the property to the claimant, the claimant may recover from the pawnbroker the costs of the action and the claimant's reasonable attorney fees.
C. If a conveying customer is convicted, pleads guilty or nolo contendere to or adjudication is deferred to a charge of theft or dealing in stolen property, the court shall order the conveying customer to repay the pawnbroker the full amount he received from the pawnbroker for the property, plus all applicable pawn service charges.
D. If the court finds that the claimant failed to comply with the requirements in Subsection A of this section or otherwise finds against the claimant, the claimant is liable for the defendant's costs, including reasonable attorney fees.
E. The sale, pledge or delivery of tangible personal property to a pawnbroker by a person in this state is considered to be:
(1) an agreement by the person who sells, pledges or delivers the tangible personal property that the
person is subject to the jurisdiction of the court in all civil actions and proceedings arising out of the pledge or sale transaction filed by either a resident or nonresident plaintiff;
(2) an appointment of the secretary of state by any nonresident of this state as that person's lawful attorney and agent upon whom may be served all process in suits pertaining to the actions and proceedings arising out of the sale, pledge or delivery; and
(3) an agreement by a nonresident that process in a suit so served has the same legal force and validity as if personally served in this state.
Section 15. HOLD ORDERS--ISSUANCE--REQUIRED INFORMATION--PROCEDURES.--
A. When an appropriate law enforcement official has probable cause to believe that property in the possession of a pawnbroker is misappropriated, the official may place a hold order on the property. The hold order shall impose a holding period not to exceed ninety days unless extended by court order. The appropriate law enforcement official may rescind, in writing, any hold order. An appropriate law enforcement official may place only one hold order on property.
B. Upon the expiration of the holding period, the pawnbroker shall notify, in writing, the appropriate law enforcement official by mail that the holding period has expired. If on the tenth day after the mailing of the notification, the pawnbroker has not received from a court an extension of the hold order on the property and the property is not the subject of a proceeding under Section 14 of the Pawnbroking Act, title to the property shall vest in and is deemed conveyed by operation of law to the pawnbroker, free of liability for claims but subject to restrictions contained in the pawn transaction contract and subject to the provisions of the Pawnbroking Act.
C. A hold order shall specify:
(1) the name and address of the pawnbroker;
(2) the name, title and identification number of the representative of the appropriate law enforcement official or the court placing the hold order;
(3) if applicable, the name and address of the appropriate law enforcement official or court to which the representative is attached and the number, if any, assigned to the claim regarding the property;
(4) the transaction number and a complete description of the property to be held, including model number and serial number if applicable;
(5) the name of the person reporting the property to be misappropriated, unless prohibited by law;
(6) the mailing address of the pawnbroker where the property is held; and
(7) the expiration date of the holding period.
D. The pawnbroker or the pawnbroker's representative shall sign and date a copy of the hold order as evidence of receipt of the hold order and the beginning of the ninety-day holding period.
E. Except as otherwise provided in this subsection, a pawnbroker may not release or dispose of property subject to a hold order except pursuant to a court order, a written release from the appropriate law enforcement official or the expiration of the holding period of the hold order. While a hold order is in effect, the pawnbroker shall upon request release the property subject to the hold order to the custody of the appropriate law enforcement official for use in a criminal investigation. The release of the property to the custody of the appropriate law enforcement official is not considered a waiver or release of the pawnbroker's property rights or interest in the property. Upon completion of the criminal proceeding, the property shall be returned to the pawnbroker unless the court orders other disposition. When another disposition is ordered, the court shall additionally order the conveying customer to pay restitution to the pawnbroker in the amount received by the conveying customer for the property together with reasonable attorney fees and costs.
Section 16. CRIMINAL PENALTIES.--
A. A person who engages in business as a pawnbroker without first securing a license is guilty of a fourth degree felony and shall be sentenced pursuant to the provisions of Section 31-18-15 NMSA 1978.
B. A person who willfully violates a mandatory or prohibitory provision of the Pawnbroking Act, who willfully makes a false entry in any record specifically required by that act or who knowingly makes a false statement in connection with a pawn transaction is guilty of a fourth degree felony and shall be sentenced pursuant to the provisions of Section 31-18-15 NMSA 1978.
Section 17. INJUNCTIONS.--When the agency has reasonable cause to believe that a person is violating the Pawnbroking Act, it may enter an order requiring the person to stop the violation. The agency may petition the district court for the county in which the alleged violation is occurring to enjoin the person from engaging in the violation, continuing the violation or doing any act in furtherance of the violation. The court may order a preliminary or permanent injunction.
Section 18. RECORDS OF THE DEPARTMENT OF PUBLIC SAFETY.--The department of public safety, if requested, shall furnish the agency arrest and conviction records in its possession of an individual applying for or holding a license pursuant to the Pawnbroking Act.
Section 19. CONFLICTING ORDINANCES.--A county or municipality may enact an ordinance that is in
compliance with but not more restrictive than, the Pawnbroking Act. A local ordinance may not restrict hours of operations other than between midnight and 6:00 a.m. A provision of an ordinance that conflicts with this section is void. Nothing in the Pawnbroking Act affects the authority of a county or municipality to establish land use controls or require a pawnbroker to obtain a local occupational license.
Section 20. RULEMAKING AUTHORITY.--The agency shall adopt, amend, repeal and promulgate reasonable rules necessary for the efficient administration and enforcement of the Pawnbroking Act. Rules adopted pursuant to this section and the agency's administration of that act are exempt from the authority of the superintendent of regulation and licensing pursuant to Section 9-16-6 NMSA 1978.
Section 21. ADVISORY COMMITTEE.--
A. To assist the agency in its rulemaking responsibilities pursuant to Section 20 of the Pawnbroking Act, an advisory committee of five members shall be appointed by the agency. The committee's membership shall consist of:
(1) three licensed pawnbrokers, each residing in a different congressional district in the state;
(2) the director of the agency or his designee; and
(3) the secretary of taxation and revenue or his designee.
B. The director of the agency or his designee shall serve as chair of the advisory committee, and it shall meet at his call.
C. The licensed pawnbroker members of the committee shall be reimbursed for their expenses incurred in attending and participating in committee meetings pursuant to the Per Diem and Mileage Act.
Section 22. TEMPORARY PROVISION--TRANSITION PERIOD FOR COMPLIANCE.--A pawnbroker operating a pawnshop in business and licensed pursuant to the Pawnbroking Act prior to July 1, 1999 has until January 1, 2000 to comply with the provisions of the Pawnbroking Act before the financial institutions division of the regulation and licensing department may initiate any administrative or civil action against the pawnbroker. Section 23. REPEAL.--Sections 56-12-1 through 56-12-16 NMSA 1978 (being Laws 1985, Chapter 228, Sections 1 through 16) are repealed.
Section 24. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 1999.