Bill Text: NY S08130 | 2023-2024 | General Assembly | Introduced


Bill Title: Provides for electronic recordkeeping requirements for second-hand dealers and pawnbrokers.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2024-01-08 - REFERRED TO CONSUMER PROTECTION [S08130 Detail]

Download: New_York-2023-S08130-Introduced.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                          8130

                    IN SENATE

                                     January 8, 2024
                                       ___________

        Introduced  by Sen. HARCKHAM -- read twice and ordered printed, and when
          printed to be committed to the Committee on Consumer Protection

        AN ACT to amend the general business law, in relation  to  recordkeeping
          requirements for second-hand dealers and pawnbrokers

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Section 41 of the general business law, as amended by chap-
     2  ter 669 of the laws of 2022, is amended to read as follows:
     3    § 41. Licenses, how obtained; penalty for carrying on business without
     4  license. The mayor or such local licensing authority may  from  time  to
     5  time  grant,  under  his or her hand and the official seal of his or her
     6  office, to such citizens, or noncitizens lawfully admitted for permanent
     7  residence in the United States, as he or she shall deem proper  and  who
     8  shall  produce to him or her satisfactory evidence of their good charac-
     9  ter, a license authorizing such person to carry on  the  business  of  a
    10  collateral loan broker, which license shall designate the house in which
    11  such  person  shall  carry on said business, and no person, corporation,
    12  partnership or firm shall carry on the business  of  a  collateral  loan
    13  broker  without being duly licensed, nor in any other house than the one
    14  designated in said license, under a penalty of one hundred  dollars  for
    15  each  day he, she or they shall exercise or carry on said business with-
    16  out such license or at any other house than the one so  designated.    A
    17  collateral  loan  broker  may conduct business via the internet provided
    18  the requirements of this chapter are  satisfied.  Any  person  receiving
    19  such  license shall pay therefor the sum of five hundred dollars for the
    20  use of the city yearly where such business is to be conducted in a  city
    21  with  a population of more than one million persons, and where the busi-
    22  ness is to be conducted elsewhere the fee for  such  license  shall  not
    23  exceed  two  hundred  fifty dollars yearly, and every such license shall
    24  expire one year from the date thereof, and may be renewed on application
    25  to the mayor or local licensing authority each and every year on payment
    26  of the same sum and upon performance  of  the  other  conditions  herein
    27  contained. Every person so licensed shall, at the time of receiving such
    28  license,  file with the mayor or such local licensing authority granting

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD13663-01-3

        S. 8130                             2

     1  the same a bond to the local authorities, to be executed by  the  person
     2  so  licensed  and  by  two responsible sureties, in the penal sum of ten
     3  thousand dollars, to be  approved  by  such  mayor  or  local  licensing
     4  authority,  which bond shall be conditioned for the faithful performance
     5  of the duties and obligations pertaining to the  business  so  licensed,
     6  and  the  mayor  or such local licensing authority shall have full power
     7  and authority to revoke such license for cause.
     8    § 2. Section 43 of the general business law, as amended by chapter 867
     9  of the laws of 1986, is amended to read as follows:
    10    § 43. Certain entries to be made [in book]; electronic record.   Every
    11  such  collateral loan broker shall keep [a book in which shall be fairly
    12  written, at the time of such loan, an account  and  description  of  the
    13  goods,  articles or things pawned or pledged, the amount of money loaned
    14  thereon, the time of pledging the same, the rate of interest to be  paid
    15  on  such  loan, the name and residence of the person pawning or pledging
    16  the said goods, articles or things and a notation of whether the pledgor
    17  claims to be the owner, consignee or agent of the owner]  an  electronic
    18  record pursuant to the provisions of article five-B of this chapter.
    19    § 3. Section 45 of the general business law, as amended by chapter 321
    20  of the laws of 1983, is amended to read as follows:
    21    §  45.  [Book] Records to be open to inspection. The said [book] elec-
    22  tronic record and any and all other [books and] records  regularly  kept
    23  by  such collateral loan broker shall at all reasonable times be open to
    24  the inspection of the attorney general, the state comptroller, the mayor
    25  or local licensing authority, all judges of  the  criminal  courts,  the
    26  superintendent  of  police,  police  inspectors,  captains of police and
    27  police justices of such cities, or any or either  of  them,  or  of  any
    28  person  who  shall be duly authorized in writing for that purpose by any
    29  or either of them, and who shall exhibit such written authority to  such
    30  collateral  loan broker.  Such power of inspection shall be exercised by
    31  the aforementioned authorized parties, or their authorized  agents,  for
    32  the  sole  purpose  of  verification  of compliance with state and local
    33  statutory and regulatory requirements, inclusive of the completeness and
    34  accuracy of the licensee's records including timeliness of entry.   Said
    35  verification may include an examination of not more than the last twenty
    36  items  pledged  and  may  include  the physical examination of each such
    37  pledge and the corresponding record, including photographic  record,  if
    38  any.  The  mayor or the licensing authority of any local governing body,
    39  the state comptroller, the attorney general and any person duly  author-
    40  ized  by  them  shall  have the power to administer oaths and to examine
    41  under oath any such collateral loan broker or any officer, or agent,  of
    42  such  collateral  loan  broker  and  any  other person having custody or
    43  control of such [books and] records. Such [books and] records  shall  be
    44  retained in the possession of the collateral loan broker, in good condi-
    45  tion  and  in  an  orderly  fashion for at least a period of six years.
    46  Nothing herein shall be construed to impede the use of warrants, subpoe-
    47  nas or  other  lawful  process  respecting  items  pledged  and  records
    48  pertaining  thereto,  provided  that  said  warrants, subpoenas or other
    49  lawful process are predicated  upon  reasonable  suspicion  of  unlawful
    50  conduct.
    51    §  4.  The  second undesignated paragraph of section 47 of the general
    52  business law, as added by chapter 534 of the laws of 2007, is amended to
    53  read as follows:
    54    A collateral loan broker engaged in the purchase or  sale  of  second-
    55  hand  articles,  other  than  pledges or pawn tickets, shall comply with
    56  state and local laws or regulations  governing  dealers  in  second-hand

        S. 8130                             3

     1  articles.  A  collateral  loan broker engaged in the purchase of second-
     2  hand articles shall provide the seller a receipt setting forth the  item
     3  or  items  purchased and the purchase price for each item. Additionally,
     4  the  receipt shall include a notice advising the seller of the option to
     5  cancel the transaction within five business days or convert the sale  of
     6  jewelry,  watches,  precious stones, precious metals and coins to a loan
     7  within fourteen days of the sale in accordance with this section.
     8    § 5. The general business law is amended by adding a new  article  5-B
     9  to read as follows:
    10                                  ARTICLE 5-B
    11     RECORDKEEPING REQUIREMENTS FOR SECOND-HAND DEALERS AND PAWNBROKERS
    12  Section 57. Reports to the secretary of state.
    13          57-a. Record of purchases and sales.
    14          57-b. Electronic reporting to the secretary of state.
    15          57-c. Penalties.
    16    §  57.  Reports to the secretary of state. Every dealer in second-hand
    17  articles who deals in the purchase or sale of any  second-hand  manufac-
    18  tured  article comprised wholly or in part of gold, silver, platinum, or
    19  other precious metals, or deals in the purchase or sale of any old gold,
    20  silver, platinum or other precious metals, or deals in the  purchase  of
    21  articles or things comprised of gold, silver, platinum or other precious
    22  metals  for the purpose of melting or refining, or deals in the purchase
    23  or sale of used electrical appliances excluding kitchen  appliances,  or
    24  deals  in the purchase or sale of any used electronic equipment, comput-
    25  ers or component parts of electronic equipment or computers, shall  make
    26  available  to  the  secretary  of  state the records required to be kept
    27  pursuant to paragraphs (a) and (d) of subdivision one of section  fifty-
    28  seven-a  of  this  article with respect to such transactions in a manner
    29  specified by the secretary of state for the New York state department of
    30  state by rule and regulation, which may include the real-time sharing or
    31  accessing of such records in an electronic format and/or through use  of
    32  an  internet  website  designated  by the secretary of state.   Sharing,
    33  accessing and reporting provisions set forth in this section  shall  not
    34  be  required  in  the absence of a local law requiring the same. Nothing
    35  herein shall be construed to impede the use of  warrants,  subpoenas  or
    36  other  lawful  process respecting items purchased and records pertaining
    37  thereto, provided that said warrants, subpoenas or other lawful  process
    38  are  predicated upon reasonable suspicion of unlawful conduct.  A second
    39  hand dealer may conduct business via the internet provided the  require-
    40  ments of this chapter are satisfied.
    41    § 57-a. Record of purchases and sales. 1.  Every dealer in second-hand
    42  articles who deals in the purchase of any second-hand manufactured arti-
    43  cle  composed  wholly  or  in  part  of gold, silver, platinum, or other
    44  precious metals, or deals in the purchase  or  sale  of  any  old  gold,
    45  silver,  platinum  or other precious metals, or deals in the purchase of
    46  articles or things comprised of gold, silver, platinum or other precious
    47  metals for the purpose of melting or refining, or deals in the  purchase
    48  or  sale  of used electrical appliances excluding kitchen appliances, or
    49  deals in the purchase or sale of any used electronic equipment,  comput-
    50  ers,  or  mobile  phones,  or component parts of electronic equipment or
    51  computers, shall with respect to such transactions create an  electronic
    52  record in English, in a manner to be specified by the secretary of state
    53  by  rule or regulation. Such electronic record may include the real-time
    54  sharing or accessing of the information specified in paragraphs (a)  and
    55  (d) of this subdivision in an electronic format and/or through use of an
    56  internet  website  designated by the secretary of state. Such electronic

        S. 8130                             4

     1  record shall be retained for a minimum period of six years from the date
     2  of purchase. Such electronic record shall be limited  to  the  following
     3  information,  provided  in a format or in accordance with specifications
     4  as provided by rule or regulation of the secretary of state:
     5    (a) The date, time, location and type of transaction;
     6    (b)  The  name  of  the  individual conducting the transaction for the
     7  dealer;
     8    (c) Identifying information regarding  the  person  offering  property
     9  purchased  by the dealer, including name, address, phone number, type of
    10  identification utilized, identification number, expiration date of iden-
    11  tification, date of birth, sex, race or ethnicity, distinguishing marks,
    12  and a digital photograph or scanned copy of identification utilized  and
    13  a signature;
    14    (d)  An accurate description of each article purchased, including type
    15  of article, manufacturer, make, model number,  serial  number,  interna-
    16  tional  mobile  equipment  identifier,  electronic serial number, mobile
    17  equipment identifier, inscriptions or distinguishing marks, and  one  or
    18  more  digital photographs reasonably capturing the likeness of the arti-
    19  cle, provided however that no photographs shall be required for fungible
    20  items.
    21    2. A dealer in second-hand  articles  subject  to  the  provisions  of
    22  subdivision one of this section shall acquire and maintain in good work-
    23  ing  order the electronic equipment necessary to create and maintain the
    24  electronic records required by this section, including but  not  limited
    25  to  a computer with internet connection, an electronic signature pad and
    26  a digital camera utilizing a file format designated by the secretary  of
    27  state.
    28    3.  The  records  required  by  this  section,  shall  be  open to the
    29  inspection of any police officer, the secretary of state or any  depart-
    30  mental  inspector,  any  judge  of  a criminal court, or any person duly
    31  authorized in writing for such purposes by the secretary of state or  by
    32  any  judge of a criminal court, who shall exhibit such written authority
    33  to the dealer.  Such records shall also be open to the inspection of any
    34  official or other person identified in, or duly  authorized  in  writing
    35  pursuant  to,  any  other  applicable state or local law.  Such power of
    36  inspection shall be exercised by the aforementioned authorized  parties,
    37  or  their  authorized  agents,  for  the sole purpose of verification of
    38  compliance with state and local statutory and  regulatory  requirements,
    39  inclusive  of  the  completeness  and accuracy of the licensee's records
    40  including timeliness of entry.  Said verification may include  an  exam-
    41  ination of not more than the last twenty items purchased and may include
    42  the  physical examination of each such item and the corresponding record
    43  including photographic record. Such records shall  be  retained  in  the
    44  possession of the second-hand dealer, in good condition and in an order-
    45  ly fashion for at least a period of six years.   Nothing herein shall be
    46  construed to impede the use of warrants, subpoenas or other lawful proc-
    47  ess  respecting items purchased and records pertaining thereto, provided
    48  that said warrants, subpoenas or other  lawful  process  are  predicated
    49  upon reasonable suspicion of unlawful conduct.
    50    4.  Notwithstanding  any  local law and ordinances to the contrary and
    51  except as otherwise provided in this chapter,  other  state  or  federal
    52  law,  second-hand  dealers  shall not be required to copy, create, main-
    53  tain, transmit or   make available,  electronically  or  otherwise,  any
    54  records of purchases or sale transactions.
    55    § 57-b. Electronic reporting to the secretary of state. 1. Every pawn-
    56  broker,  shall  make  available  to  the  secretary of state the records

        S. 8130                             5

     1  required to be kept pursuant to paragraphs (a), (d)  and (e) of subdivi-
     2  sion two of this section, in a manner to be specified by  the  secretary
     3  of  state by rule or regulation, which may include the real-time sharing
     4  or  accessing of such records in an electronic format and/or through use
     5  of an internet website designated by the secretary of state.
     6    2. Every pawnbroker shall create at the time of transaction  an  elec-
     7  tronic  record  in English, in a manner to be specified by the secretary
     8  of state by rule or regulation, which may include the use of an internet
     9  website designated by the secretary of state, of  every  transaction  in
    10  which  goods,  articles  or  things,  or  any  part thereof, are pawned,
    11  pledged or redeemed in the course of business of such pawnbroker.  Shar-
    12  ing,  accessing  and  reporting provisions specified herein shall not be
    13  required in the absence of a local law requiring the same.  In no  event
    14  shall information be subject to  sharing, accessing or reporting except-
    15  ing  information required to be reported pursuant to paragraphs (a), (d)
    16  and (e) of this subdivision. Such electronic record  shall  be  retained
    17  for a minimum period of six years from the date of the transaction. Such
    18  electronic  record  shall  be  limited  to  the  following  information,
    19  provided in a format or in accordance with specifications as provided by
    20  rule or regulation of the secretary of state:
    21    (a) The date, time, location and type of transaction;
    22    (b) The name of the individual  conducting  the  transaction  for  the
    23  pawnbroker;
    24    (c)  Identifying  information  regarding  the pledgor, including name,
    25  address, phone number, type of identification  utilized,  identification
    26  number,  expiration  date of identification, a signature, date of birth,
    27  sex, height, weight, eye color, hair color, race or  ethnicity,  distin-
    28  guishing  marks,  digital  photograph  or scanned copy of identification
    29  utilized, and whether the pledgor is the owner, consignee  or  agent  of
    30  the owner;
    31    (d) An accurate description of each article pawned or pledged, includ-
    32  ing  type  of  article, manufacturer, make, model number, serial number,
    33  international mobile equipment  identifier,  electronic  serial  number,
    34  mobile  equipment  identifier, inscriptions or distinguishing marks, and
    35  one or more digital photographs reasonably capturing the likeness of the
    36  article, provided however that no  photographs  shall  be  required  for
    37  fungible items;
    38    (e) The pledge number of the pawn ticket;
    39    (f)  The amount loaned or advanced thereon and the rate of interest to
    40  be paid on such loan or advance.
    41    3. The pawnbroker shall acquire and maintain in good working order the
    42  electronic equipment necessary to create  and  maintain  the  electronic
    43  records required by this section, including but not limited to a comput-
    44  er  with  internet connection, an electronic signature pad and a digital
    45  camera utilizing a file format designated by the secretary of state.
    46    4. The electronic records required by this section shall  be  open  to
    47  inspection pursuant to section forty-five of this chapter.
    48    5. Notwithstanding any local law and ordinances to  the  contrary  and
    49  except  as provided in this chapter, other state or federal law, collat-
    50  eral loan brokers shall not be required to copy, create, maintain, tran-
    51  smit or make available, electronically  or  otherwise,  any  records  of
    52  pledges, purchases, foreclosures or sale transactions.
    53    6. In addition to any other applicable penalty or sanction, any person
    54  who  violates any of the provisions of this section or rules promulgated
    55  thereunder shall be subject  to  the  penalties  set  forth  in  section
    56  fifty-seven-c of this article.

        S. 8130                             6

     1    §   57-c.   Penalties.   1. Except as otherwise specifically provided,
     2  any person who violates any provision of this article or any  regulation
     3  or  rule    promulgated    thereunder shall, upon conviction thereof, be
     4  punished for each violation by a fine of  not  less  than    twenty-five
     5  dollars  nor  more  than  five  hundred  dollars, or by imprisonment not
     6  exceeding fifteen days,  or   both;   and   any   such person  shall  be
     7  subject  also  to a civil penalty in the sum of one hundred dollars  for
     8  each  violation,  to  be recovered in a civil action.
     9    2.  The attorney general is authorized to bring an injunction proceed-
    10  ing to restrain or enjoin any violation of this article.
    11    § 6. This act shall take effect on the one hundred eightieth day after
    12  it  shall have become a law. Effective immediately, the addition, amend-
    13  ment and/or repeal of  any  rule  or regulation necessary for the imple-
    14  mentation of this act on its effective date are authorized  to  be  made
    15  and  completed on or before such effective date.
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