[HISTORY: Adopted by the City of Isanti 4-7-2020 by Ord. No. 728.[1] Amendments noted where applicable.]
[1]
Editor's Note: This ordinance repealed former Ch. 233, Pawn
Shops, adopted 10-18-2005 by Ord. No. 345, as amended.
A.
The City of Isanti finds that use of services provided by pawnbrokers
provides an opportunity for the commission of crimes and their concealment
because pawn businesses have the ability to receive and transfer property
stolen by others easily and quickly. The City of Isanti also finds
that consumer protection regulation is warranted in transactions involving
pawnbrokers. The City of Isanti further finds that the pawn industry
has outgrown the City's current ability to effectively or efficiently
identify criminal activity related to pawn shops. The purpose of this
chapter is to prevent pawn businesses from being used as facilities
for the commission of crimes, and to assure that such businesses comply
with basic consumer protection standards, thereby protecting the public
health, safety, and general welfare of the citizens of the City.
B.
To help the Isanti Police Department better regulate current and
future pawn businesses, decrease and stabilize costs associated with
the regulation of the pawn industry, and increase identification of
criminal activities in the pawn industry through the timely collection
and sharing of pawn transaction information, this chapter also implements
and establishes the required use of an automated pawn system.
As used in this chapter, the following terms shall have the
meanings indicated:
A computer database, accessible from remote locations, designed
to input and retrieve data on pawnbroker transactions.
Except as provided in this definition, "pawnbroker" means
any person engaged in whole or in part in the business of lending
money on the security of pledged goods left in pawn, or in the business
of purchasing tangible personal property to be left in pawn on the
condition that it may be redeemed or repurchased by the seller for
a fixed price within a fixed period of time. The following are exempt
from the definition of "pawnbroker": any bank regulated by the State
of Minnesota, the comptroller of the currency of the United States,
the Federal Deposit Insurance Corporation, the Board of Governors
of the Federal Reserve System, or any other federal or state authority
and their affiliates; any bank or savings association whose deposits
or accounts are eligible for insurance by the Federal Deposit Insurance
Corporation or any successor to it and all affiliates of those banks
and savings associations; any state or federally chartered credit
union; and any industrial loan and thrift company or regulated lender
subject to licensing and regulation by the Department of Commerce.
Every transaction conducted by a pawnbroker in which merchandise
is received through a pawn, purchase, consignment or trade, or in
which a pawn is renewed, extended or redeemed, or for which a unique
transaction number or identifier is generated by their point-of-sale
software, or an item is confiscated by law enforcement, is reportable
except:
A.
The bulk purchase or consignment of new or used merchandise from
a merchant, manufacturer or wholesaler having an established permanent
place of business, and the retail sale of said merchandise, provided
the pawnbroker must maintain a record of such purchase or consignment
which describes each item, and must mark each item in a manner which
relates it to that transaction record.
B.
Retail and wholesale sales of merchandise originally received by
pawn or purchase, and for which all applicable hold and/or redemption
periods have expired.
Every reportable transaction conducted by a pawnbroker is a
billable transaction except renewals, redemptions or extensions of
existing pawns on items previously reported and continuously in the
licensee's possession, voided transactions and confiscations.
No person shall engage in the business of pawnbroker at any
location without a pawnbroker's license for that location. No pawnbroker
license may be transferred to a different location or a different
person. Issuance of a license under this chapter shall not relieve
the licensee from obtaining any other licenses required to conduct
business at the same or other locations.
A.
The application must be accompanied by the license fees specified,
which may be amended from time to time by action of the City Council.
B.
License fees will be prorated if the license is applied for and issued
after April 1.
[Amended 7-20-2021 by Ord. No. 763]
C.
The billable transaction license fee shall reflect the cost of processing
transactions and other related regulatory expenses as determined by
the Isanti City Council by ordinance and adjusted as necessary. Licensees
shall be notified in writing 30 days before any adjustment is implemented.
D.
Billable transaction fees shall be billed monthly and are due and
payable within 30 days. Failure to pay billable transaction fees within
30 days is a violation of this chapter.
[Amended 7-20-2021 by Ord. No. 763]
All licenses shall expire on March 31.
A.
Contents. An application form provided by the City Clerk's office
must be completed by every applicant for a new license or for renewal
of an existing license. Every new applicant and renewals of an existing
license must provide all the following information:
(1)
If the applicant is a natural person:
(a)
The name, place and date of birth, street resident address,
and phone number of applicants.
(b)
Whether the applicant is a citizen of the United States or resident
alien.
(c)
Whether the applicant has ever used or has been known by a name
other than the applicant's name, and if so, the name or names used
and information concerning dates and places used.
(d)
The name of the business if it is to be conducted under a designation,
name, or style other than the name of the applicant and a certified
copy of the certificate as required by Minn. Stat. § 333.01,
as amended from time to time.
(e)
The street address at which the applicant has lived during the
preceding five years.
(f)
The type, name and location of every business or occupation
in which the applicant has been engaged during the preceding five
years and the name(s) and address(s) of the applicant's employer(s)
and partner(s), if any, for the proceeding five years.
(g)
Whether the applicant has ever been convicted of a felony, crime,
or violation of any ordinance other than a traffic ordinance. If so,
the applicant must furnish information as to the time, place, and
offense of all such convictions.
(h)
The physical description of the applicant.
(i)
Applicant's current personal financial statement and true copies
of the applicant's federal and state tax returns for the two years
prior to application.
(2)
If the applicant is a partnership:
(a)
The name(s) and address(s) of all general and limited partners and all information concerning each general partner required in Subsection A(1) of this section.
(b)
The name(s) of the managing partner(s) and the interest of each
partner in the licensed business.
(c)
A true copy of the partnership agreement shall be submitted
with the application. If the partnership is required to file a certificate
as to a trade name pursuant to Minn. Stat. § 333.01, as
amended from time to time, a certified copy of such certificate must
be attached to the application.
(d)
A true copy of the federal and state tax returns for partnership
for the two years prior to application.
(3)
If the applicant is a corporation or other organization:
(a)
The name of the corporation or business form, and if incorporated,
the state of incorporation.
(b)
A true copy of the certificate of incorporation, articles of
incorporation or association agreement, and bylaws shall be attached
to the application. If the applicant is a foreign corporation, a certificate
of authority as required by Minn. Stat. § 303.06, as amended
from time to time, must be attached. Any proposed change to either
the articles or the bylaws of the corporation must be reported to
the City Clerk at least 14 days prior to the date such change is to
be adopted by the corporation. In the case of a corporate application,
the application must also describe fully the relationship of the corporation
to any other corporation including the name, business address, state
of incorporation, names of stockholders, directors and officers thereof
as provided hereafter, but in the case of publicly held corporations,
the City may accept disclosure documents required by the Securities
and Exchange Commission of the United States of America in lieu of
such information.
(d)
A list of all persons who control or own an interest in excess of 5% in such organization or business form or who are officers of the corporation or business form and all information concerning said persons required in Subsection A(1) above. This Subsection A(3)(d), however, shall not apply to a corporation whose stock is publicly traded on a stock exchange and is applying for a license to be owned and operated by it.
(4)
For all applicants:
(a)
Whether the applicant holds a current pawnbroker, precious metal
dealer or secondhand goods dealer license from any other governmental
unit.
(b)
Whether the applicant has previously been denied, or had revoked
or suspended, a pawnbroker, precious metal dealer, or secondhand dealer
license from any other governmental unit.
(c)
The location of the business premises.
(d)
If the applicant does not own the business premises, a true
and complete copy of the executed lease.
(e)
The legal description of the premises to be licensed.
(f)
Whether all real estate and personal property taxes that are
due and payable for the premises to be licensed have been paid, and
if not paid, the years and amounts that are unpaid.
(g)
Whenever the application is for premises either planned or under
construction or undergoing substantial alteration, the application
must be accompanied by a set of preliminary plans showing the design
of the proposed premises to be licensed.
(h)
Such other information as the City of Isanti or issuing authority
may require.
(i)
The applicant and/or their legal representative shall be present
at the City Council meeting where the application for a new license,
or renewal of an existing license, is under consideration. Applications
will not be considered for approval unless the applicant or the applicant's
legal representative is present at the meeting.
B.
New manager.
(1)
When a licensee places a manager in charge of a business, or if the
named manager(s) in charge of a licensed business changes, the licensee
must complete and submit the appropriate application within 14 days.
The application must include all appropriate information required
in this section.
(2)
Upon completion of a background investigation of a new manager, the
licensee must pay an amount equal to the cost of the investigation
to assure compliance with this chapter. If the investigation process
is conducted solely within the State of Minnesota, the fee shall be
the cost of the investigation, as set by the City of Isanti. If the
investigation is conducted outside the State of Minnesota, the issuing
authority may recover the actual investigation costs.
C.
Application execution. All applications for a license under this
chapter must be signed and sworn to under oath or affirmation by the
applicant. If the application is that of a natural person, it must
be signed and sworn to by such person; if that of a corporation, by
an officer thereof; if that of a partnership, by one of the general
partners; and if that of an unincorporated association, by the manager
or managing officer thereof.
D.
Investigation. All license applications submitted under this chapter
must be referred to the Isanti Police Department to conduct a background
investigation. Every individual or person having any beneficial interest
must be so investigated. The Isanti Police Department must investigate
into the truthfulness of the statements set forth in the application.
The applicant must furnish to the Isanti Police Department's license
inspector such evidence as the inspector may reasonably require in
support of the statements set forth in the application. The Chief
of Police or their designee must report the findings and comments
to the City Administrator who must order or conduct such additional
investigations as the administrator deems necessary or as the City
Council directs.
E.
Persons ineligible for a license. No licenses under this chapter
will be issued to an applicant who is a natural person, a partnership
if such applicant has any general partner or managing partner, a corporation
or other organization if such applicant has any manager, proprietor
or agent in charge of the business to be licensed, if the applicant:
(1)
Is a minor at the time that the application is filed;
(2)
Has been convicted of any crime directly related to the occupation
licensed as prescribed by Minn. Stat. § 364.03, Subd. 2,
as amended from time to time; and has not shown competent evidence
of sufficient rehabilitation and present fitness to perform the duties
of a licensee under this chapter as prescribed by Minn. Stat. 364.03,
Subd. 3, as amended from time to time;
[Amended 7-20-2021 by Ord. No. 763]
(3)
Is not of good moral character or repute;
(4)
Has been the subject of an investigation by a consumer protection
agency, State Attorney General's office, Better Business Bureau, or
similar group or agency and such investigation has indicated a pattern
of disregard of consumer rights in the conduct of the business;
(6)
Has knowingly falsified or misrepresented information on the application;
(7)
Is not the real party with interest in the business being licensed
or registered;
(8)
Has had an interest in a corporation, partnership, association, enterprise,
business or firm that had a pawnbroker, precious metal or secondhand
goods dealer's license denied or revoked as a result of a violation
of law within five years of the date the license or registration application
is submitted to the issuing authority; or
(9)
Owes taxes or assessments to the state, county, school district or
City that are due or delinquent.
Before a license will be issued, every applicant must submit
a bond on the forms provided by the licensing authority. The bond
will be $5,000. All bonds must be conditioned that the principal will
observe all laws in relation to pawnbrokers, and will conduct business
in conformity thereto, and that the principal will account for and
deliver to any person legally entitled any goods which have come into
the principal's hand through the principal's business as a pawnbroker,
or in lieu thereof, will pay the reasonable value in money to the
person. The bond shall contain a provision that no bond may be canceled
except upon 30 days' written notice to the City of Isanti, which shall
be served upon the licensing authority.
At the time of any reportable transaction other than renewals,
extensions or redemptions, every licensee must immediately record
in English the following information by using ink or other indelible
medium on forms or in a computerized record approved by the Isanti
Police Department.
A.
A complete and accurate description of each item including, but not
limited to, any trademark, identification number, serial number, model
number, brand name, or other identifying mark on such an item.
B.
The purchase price, amount of money loaned upon, or pledged therefor.
C.
The maturity date of the transaction and the amount due, including
monthly and annual interest rates and all pawn fees and charges.
D.
Date, time and place the item of property was received by the licensee,
and the unique alpha and/or numeric transaction identifier that distinguishes
it from all other transactions in the licensee's records.
E.
Full name, current residence address, current residence telephone
number, date of birth and accurate description of the person from
whom the item of the property was received, including: sex, height,
weight, race, color of eyes and color of hair.
G.
The signature of the person identified in the transaction.
H.
Color photographs or videos.
(1)
Effective 60 days from the date of notification by the Isanti Police
Department of acceptable video standards, the licensee must also take
a color photograph or color video recording of:
(2)
If a photograph is taken, it must be at least two inches in length
by two inches in width and must be maintained in such a manner that
the photograph can be readily matched and correlated with all other
records of the transaction to which they relate. Such photographs
must be available to the Isanti Police Department or the Isanti Police
Department's designee, upon request. The major portion of the photograph
must include an identifiable front facial close-up of the person who
pawned or sold the item. Items photographed must be accurately depicted,
and serial or identification numbers shall be photographed if applicable.
The licensee must inform the person that they are being photographed
by displaying a sign of sufficient size in a conspicuous place in
the premises. If a video photograph is taken, the video camera must
zoom in on the person pawning or selling the item so as to include
an identifiable close-up of that person's face. Items photographed
by video must be accurately depicted. Video photographs must be electronically
referenced by time and date so they can be readily matched and correlated
with all other records of the transaction to which they relate. The
licensee must inform the person that he or she is being videotaped
orally and by displaying a sign of sufficient size in a conspicuous
place on the premises. The licensee must keep the exposed videotape
for three months.
I.
Digitized photographs. Effective 60 days from the date of notification by the Isanti Police Department, licensees must fulfill the color photograph requirements as specified in Subsection H above by submitting them as digital images, in a format specified by the issuing authority, electronically cross-referenced to the reportable transaction they are associated with. Notwithstanding the digital images may be captured from required video recordings, this provision does not alter or amend the requirements in Subsection H.
J.
Renewals, extensions and redemptions. For renewals, extensions and
redemptions, the licensee shall provide the original transaction identifier,
the date of the current transaction, and the type of transaction.
K.
Inspection of records. The records must at all reasonable times be
open to inspection by the Isanti Police Department or authorized City
employees or agents. Data entries shall be retained for at least three
years from the date of transaction. Entries of required digital images
shall be retained a minimum of 90 days.
A.
Effective no later than 60 days after the Isanti Police Department
provides licensees with the current version of the automated pawn
interchange file specification format or similar automated record
system that may be specified by the City, licensees must submit every
reportable transaction to the Isanti Police Department daily in the
following manner: Licensees must provide to the Isanti Police Department
all reportable transaction information by transferring it from their
computer to the automated pawn system interchange file specification
format or similar automated record system as specified by the City
via a modem using the current version. All required records must be
transmitted completely and accurately after the close of the business
each day in accordance with standards and procedures established by
the issuing authority. Any transaction that does not meet the automated
pawn system interchange file specification format must be corrected
and resubmitted the next business day. The licensee must display a
sign of sufficient size, in a conspicuous place in the premises, which
informs patrons that all transactions are reported to the Isanti Police
Department daily.
[Amended 7-20-2021 by Ord. No. 763]
B.
Billable transaction fees. Licensees will be charged for each billable
transaction reported to the Isanti Police Department.
(1)
If a licensee is unable to successfully transfer the required reports
by modem, the licensee must provide the Isanti Police Department,
upon request, printed copies of all reportable transactions along
with the videotape(s) for that date, by 12:00 noon the next business
day.
(2)
If the problem is determined to be in the licensee's system and is not corrected by the close of the first business day following the failure, the licensee must continue to provide the required reports as detailed in § 233-11, Daily reports to Isanti Police Department, Subsection B(1), and must be charged a $50 reporting failure penalty, daily, until the error is corrected.
(4)
If a licensee is unable to capture, digitize or transmit the photographs required in § 233-10, Records required, the licensee must immediately take all required photographs with a still camera, cross-reference the photographs to the correct transaction, and make the pictures available to the Isanti Police Department upon request.
(5)
Regardless of the cause or origin of the technical problems that
prevented the licensee from uploading their reportable transactions,
upon correction of the problem, the licensee shall upload every reportable
transaction from every business day the problem had existed.
Every licensee must provide a receipt to the party identified
in every reportable transaction and must maintain a duplicate of that
receipt for three years. The receipt must include at least the following
information:
A.
The name, address and telephone number of the licensed business.
B.
The date and time the item was received by the licensee.
C.
Whether the item was pawned or sold, or the nature of the transaction.
D.
An accurate description of each item received including, but not
limited to, any trademark, identification number, serial number, model
number, brand name, or other identifying mark on such an item.
E.
The signature or unique identifier of the licensee or employee that
conducted the transaction.
F.
The amount advanced or paid.
G.
The monthly and annual interest rates, including all pawn fees and
charges.
H.
The last regular day of business by which the item must be redeemed
by the pledger without risk that the item will be sold, and the amount
necessary to redeem the pawned item on that date.
I.
The full name, current residence address, current residence telephone
number, and date of birth of the pledger or seller.
J.
The identification number and state of issue from any of the following
forms of identification of the seller:
K.
Description of the pledger or seller including approximate sex, height,
weight, race, color of eyes and color of hair.
L.
The signature of the pledger or seller.
M.
All printed statements as required by Minn. Stat. § 325J.04,
Subd. 2, as amended from time to time, or any other applicable rule
or law.
[Amended 7-20-2021 by Ord. No. 763]
Any person pledging, pawning or depositing an item for security must have a minimum of 60 days from the date of that transaction to redeem the item before it may be forfeited and sold. During the ninety-day holding period, items may not be removed from the licensed location except as provided in § 233-20, Business at only one place. Licensees are prohibited from redeeming any item to anyone other than the person to whom the receipt was issued or, to any person identified in a written and notarized authorization to redeem the property identified in the receipt, or to a person identified in writing by the pledger at the time of the initial transaction and signed by the pledger, or with approval of the Isanti Police Department license inspector. Written authorization for release of property to persons other than original pledger must be maintained along with original transaction record in accordance with § 233-10, Records required.
Any item purchased or accepted in trade by a licensee must not
be sold or otherwise transferred for 21 days from the date of the
transaction. Exceptions shall be given to media items, to include
VHS tapes, CD, DVD, Blue-Ray Discs, HD DVD, audio cassettes, books,
video games and other items deemed similar. Such media items must
not be sold or otherwise transferred for 14 days from the date of
transaction.
A.
Investigative hold. Whenever a law enforcement official from any agency notifies a licensee not to sell an item, the item must not be sold or removed from the premises. The investigative hold shall be confirmed in writing by the originating agency within 72 hours and will remain in effect for 15 days from the date of initial notification, or until the investigative order is canceled, or until an order to hold/confiscate is issued, pursuant to § 233-15, Isanti Police Department order to hold property, Subsection B, whichever comes first.
B.
Order to hold. Whenever the Isanti Police Department or the Isanti
Police Department's designee notifies a licensee not to sell an item,
the item must not be sold or removed from the licensed premises until
authorized to be released by the Isanti Police Department or the Isanti
Police Department's designee. An order to hold can include: direct
correspondence by the Isanti Police Department or Isanti Police Department's
designee verbally or in writing; or a hold order within an automated
pawn system. The order to hold shall expire 90 days from the date
it is placed unless the Isanti Police Department or the Isanti Police
Department's designee determines the hold is still necessary and notifies
the licensee in writing.
C.
Order to confiscate. If an item is identified as stolen or evidence
in a criminal case, the Isanti Police Department or the Isanti Police
Department's designee may:
(1)
Physically confiscate and remove it from the shop, pursuant to a
written order from the Isanti Police Department or the Isanti Police
Department's designee; or
(2)
Place the item on hold or extend the hold as provided herein, and
leave it in the licensed premises under the control of the licensee
who shall be responsible for maintaining possession of the item. When
an item is confiscated, the person doing so shall provide identification
upon request of the licensee, and shall provide the licensee the name
and phone number of the confiscating agency and investigator, and
the case number related to the confiscation. When an order to hold/confiscate
is no longer necessary, the Isanti Police Department or the Isanti
Police Department's designee shall so notify the licensee.
At all times during the terms of the license, the licensee must
allow law enforcement officials to enter the premises where the licensed
business is located, including all off-site storage facilities as
authorized herein, during normal business hours, except in an emergency.
The purpose of inspecting such premises and inspecting the items,
wares and merchandise and records therein is to verify compliance
with this chapter or applicable laws.
Licensees must attach a label to every item at the time it is
pawned, purchased or received in inventory from any reportable transaction.
Permanently recorded on this label must be the number or name that
identifies the transaction in the shop's records, the transaction
date, the name of the item and the description or the model and serial
number of the item as reported to the Isanti Police Department, whichever
is applicable, and the date the item is out of pawn or can be sold,
if applicable. Labels shall not be reused.
A.
No person under the age of 18 years may pawn or sell or attempt to
pawn or sell goods with any licensee, nor may any licensee receive
any goods from a person under the age of 18 years.
B.
No licensee may receive any goods from a person of unsound mind or
from persons who are clearly under the influence of an intoxicating
substance.
C.
No licensee may receive any goods, unless the seller presents identification
in the form of a valid driver's license, a valid State of Minnesota
identification card, or current valid photo driver's license or identification
card issued by the state or province of residency of the person from
whom the item was received, or valid passport, or valid military identification
card.
[Amended 7-20-2021 by Ord. No. 763]
D.
No licensee may receive any item of property that possesses an altered
or obliterated serial number or identification number or any item
of property that has had its serial number removed.
E.
No person may pawn, pledge, sell, consign, leave, or deposit any
article of property which they do not have lawful ownership of. No
person shall pawn, pledge, sell, consign, leave, or deposit the property
of another, whether with permission or without; nor shall any person
pawn, pledge, sell, consign, leave, or deposit any article of property
in which another has a security interest in.
F.
No person seeking to pawn, pledge, sell, consign, leave, or deposit
any article of property with any licensee shall give a false or fictitious
name; false date of birth; or false or out-of-date address of residence
or telephone number or present a false or altered identification,
or the identification of another, to any licensee.
Any license under this chapter may be denied, suspended or revoked
for one or more of the following reasons.
A.
The proposed use does not comply with any applicable law or rule,
including applicable zoning laws.
[Amended 7-20-2021 by Ord. No. 763]
B.
The proposed use does not comply with any health, building, building
maintenance or other provisions of this City Code or state law.
C.
The applicant or licensee has failed to comply with one or more provisions
of this chapter.
D.
The applicant is not a citizen of the United States or a resident
alien, or upon whom it is impractical or impossible to conduct a background
or financial investigation due to the unavailability of information.
E.
Fraud, misrepresentation or bribery in securing or renewing a license.
F.
Fraud, misrepresentation or false statements made in the application
and investigation for, or in the course of the applicant's business
dealings.
G.
Violation within the preceding five years, of any law relating to
theft, damage or trespass to property, sale of a controlled substance,
or operation of a business, or any other crime involving moral turpitude.
[Amended 7-20-2021 by Ord. No. 763]
H.
The owner of the premises licensed or to be licensed would not qualify
for a license under the terms of this chapter.
A license under this chapter authorizes the licensee to carry on its business only at the permanent place of business designated in the license. However, upon written request, the Isanti Police Department license inspector may approve an off-site locked and secured storage facility. The licensee shall permit inspection of the facility in accordance with § 233-16, Inspection of premises, items and records. All provisions of this chapter regarding recordkeeping and reporting apply to the facility and its contents. Property shall be stored in compliance with all provisions of City code. The licensee must either own the building in which the business is conducted, and any approved off-site storage facility, or have a lease on the business premises that extends for more than six months.
Should any section, subsection, clause or other provision of
this chapter be declared by a court of competent jurisdiction to be
invalid, such decision shall not affect the validity of the chapter
as a whole or any part other than the part so declared invalid.
