A City Council committee Thursday advanced bills requiring stricter reporting of transactions by pawnbrokers and secondhand dealers even though they no longer include the most significant proposal: forcing all transactions to be filed electronically.
City officials determined that such a requirement is against a state law that says the dealers can file either electronically or by paper.
As a result, Public Works Chairwoman Carole Fukunaga changed Bills 51 and 52 to give dealers a choice in the latest drafts, which were approved.
The bills do, however, still prohibit dealers from knowingly entering into pawn or purchase transactions with people under 18, and require even paper transactions to be transmitted to the Police Department at the end of each business day.
The bills now go back to the full Council, but Fukunaga said Council members will need to see whether the measures still have teeth without the electronic reporting requirements.
The Police Department proposed the bills in hopes of consolidating existing laws, holding the dealers more accountable and making locating stolen merchandise easier for officers. An estimated $3 million in jewelry and precious metals is stolen annually on Oahu, less than 1 percent of which is recovered, police said.
The bills would affect not just pawnbrokers, defined as those who provide loans to customers using their valuables as collateral, but also others who act as secondhand dealers by buying and selling valuable items such as jewelry and golf clubs.
The proposals have received a lukewarm reception from the dealers, who expressed a variety of concerns, including the possibility that potential sellers would be scared off from pawn and secondhand shops because of onerous identification requirements.
To appease the industry, the Police Department agreed to remove from the reporting transactions sensitive information about sellers, including workplace and home phone numbers, the last four digits of their Social Security number, hair and eye color, and full-face photographs. The bills also no longer require dealers to maintain copies of all their transactions for at least a year if not submitted electronically.
No pawnbrokers or secondhand dealers testified at Thursday’s meeting, but several submitted written testimony.
John Spiker, Hawaii Pawnbrokers Association president, said obtaining additional information from customers including height and weight, and other physical marks such as tattoos and scars, would "create a heavy burden on small businesses."
Spiker said keeping the requirement that transactions be filed daily is unreasonable, especially for those who don’t file electronically.
Brett Pruitt, whose wife’s heirloom jewelry was taken in a burglary, testified that the bills don’t go far enough.
Pruitt said he went to four pawnshops trying to find the stolen items. He suggested that the city not only require electronic filing, but that each filing be accompanied by a photo of merchandise that could then be made available online to people trying to recover their valuables.
The Police Department is expected to lobby next year at Legislature for a change in state law to require electronic filing.
