[1]
Prior ordinance history: Prior code §§ 20.1—20.5, Ord. 10-003.
The purpose of this chapter is to curtail the dissemination of stolen property and to facilitate the recovery of stolen property. This chapter is an extension of the statewide requirements regarding licensing of secondhand dealers and pawnbrokers, and the reporting of secondhand goods, at Business and Professions Code Sections 21625 through 21647, and Financial Code Sections 21000 through 21307, and is consistent with those requirements.
(Ord. 2014-003 § 1, 2014 (part))
In this chapter:
“Chief”
means the city’s chief of police or his or her designee.
“Pawnbroker”
means a person engaged in the business of receiving goods, including motor vehicles, in pledge as security for a loan. (Financial Code Section 21000.) “Pawnbroker” does not include anyone exempt under Financial Code Section 21050.
“Secondhand dealer”
means any person, copartnership, firm or corporation whose business includes buying, selling, trading, taking in pawn, accepting on sale for consignment, accepting for auctioning, or auctioning secondhand tangible personal property. A “secondhand dealer” does not include a “coin dealer” or participants at gun shows or events, as defined in Section 478.100 of Title 27 Code of Federal Regulations, or its successor, who are not required to be licensed pursuant to Sections 26700 to 26915, inclusive, of the Penal Code, who are acting in compliance with the requirements of Sections 26500 to 26585, inclusive, and 27545 of the Penal Code, and who are not “gun show traders,” as described in Sections 16620 and 26525 of the Penal Code. It does not include any of the following:
1. 
A coin dealer or participants at gun shows or events. As used in this section, a “coin dealer” means any person, firm, partnership, or corporation whose principal business is the buying, selling, and trading of coins, monetized bullion, or commercial grade ingots of gold, or silver, or other precious metals;
2. 
A person who performs the services of an auctioneer for a fee or salary; or
3. 
A person whose business is limited to the reconditioning and selling of major household appliances, if the person:
a. 
Does not trade, take in pawn, accept for drop-off, accept as a trade-in, accept for sale on consignment, accept for auction, or buy, except in bulk, the appliances;
b. 
Does not perform repair services for owners of appliances unless the appliance was purchased from the person; and
c. 
Has never been convicted of the crime of attempting to receive or receiving stolen property or any other theft-related crime. (Business and Professions Code Sections 21626 and 21626.5.)
“Tangible personal property”
means all secondhand tangible personal property which bears a serial number or personalized initials or inscription or which, at the time it is acquired by the secondhand dealer, bears evidence of having had a serial number or personalized initials or inscription. It includes, but is not limited to:
1. 
All tangible personal property, new or used, including motor vehicles, received in pledge as security for a loan by a pawnbroker.
2. 
All tangible personal property that bears a serial number or personalized initials or inscription which is purchased by a secondhand dealer or a pawnbroker or which, at the time of such purchase, bears evidence of having had a serial number or personalized initials or inscription.
3. 
All personal property commonly sold by secondhand dealers which statistically is found through crime reports to the Attorney General to constitute a significant class of stolen goods. A list of such personal property shall be supplied by the Attorney General to all local law enforcement agencies. Such list shall be reviewed periodically by the Attorney General to ensure that it addresses current problems with stolen goods.
“Tangible personal property” does not include any new goods or merchandise purchased from a bona fide manufacturer or distributor or wholesaler of such new goods or merchandise by a secondhand dealer. However, a secondhand dealer shall retain for one year from the date of purchase, and shall make available for inspection by any law enforcement officer, any receipt, invoice, bill of sale or other evidence of purchase of such new goods or merchandise.
“Tangible personal property” does not include coins, monetized bullion, or commercial grade ingots of gold, silver, or other precious metals. “Commercial grade ingots” means 0.99 fine or finer ingots of gold, silver, palladium, or platinum, or 0.925 fine sterling silver art bars and medallions; provided, that the ingots, art bars, and medallions are marked by the refiner or fabricator as to their assay fineness. (Business and Professions Code Section 21627.)
(Ord. 2014-003 § 1, 2014 (part))
A. 
Applicability. This chapter applies to:
1. 
The licensing of secondhand dealers and pawnbrokers; and
2. 
Tangible personal property as defined in Section 5.28.020, except as provided in subsection B of this section.
B. 
Exceptions. This chapter does not apply to any tangible personal property if it:
1. 
Has been acquired or reported under Business and Professions Code Section 21629; acquired from another secondhand dealer; acquired in a nonjudicial sale, transfer, assignment or consignment of a commercial enterprise, or an entire household; acquired in a sale made by an official or trustee; acquired as surplus governmental property; reported by a secondhand dealer; or acquired by certain persons who buy, sell or trade precious metals; or
2. 
Has been acquired by a secondhand dealer with the understanding or expectation that the property would later be reacquired by the transferor. (Business and Professions Code Section 21629.5.)
(Ord. 2014-003 § 1, 2014 (part))
A. 
Secondhand dealer license required. Each secondhand dealer shall obtain a secondhand dealer license from the police department before operating in the city, and shall renew that license every two years. (Business and Professions Code Sections 21640 through 21642.)
B. 
Pawnbroker license required. Each pawnbroker shall obtain a pawnbroker license from the police department before operating in the city, and shall renew that license every two years. (Financial Code Section 21300.) In addition to the other requirements of this section, the applicant for a pawnbroker’s license shall file with the city: (1) a pawnbroker’s two-year nonrevokable surety bond of twenty thousand dollars, as required by Financial Code Section 21303; and (2) a financial statement confirming that the applicant has at least one hundred thousand dollars in the form of liquid assets readily available for use in each licensed business, or other security as provided by Financial Code Section 21304. A pawnbroker licensed under this section is exempt from the licensing requirements for a secondhand dealer, but is required to conform to all other requirements of secondhand dealers. (Financial Code Section 21306.)
C. 
Application and license fee. The license application (and renewal) shall be on a form provided by the city and approved by the Department of Justice, and the applicant shall pay a license fee and renewal fee in the amount established by city council resolution.
The fee shall take into account both (1) the cost to the city in issuing the license or renewal and (2) the city’s cost in receiving, reviewing and transmitting to the Department of Justice the transaction reports. The fee may also include any additional fee imposed by the Department of Justice. (Business and Professions Code Section 21642; Financial Code Section 21300 and 21301.)
D. 
Approval or denial of application. The chief shall accept an application for and grant a license permitting the licensee to engage in the business of secondhand dealer or pawnbroker to an applicant who has not been convicted of an attempt to receive stolen property or any other offense involving stolen property. Prior to the granting of a license, the chief shall submit the application to the Department of Justice. If the Department of Justice does not comment on the application within thirty days thereafter, the chief may grant the applicant a license. The chief shall deny an application (in writing) if the applicant:
1. 
Has knowingly made a false or misleading statement or omission in the application;
2. 
Is under eighteen years old;
3. 
Has had a similar type of license or permit revoked, suspended or denied within five years immediately preceding the date of the application;
4. 
Has refused to consent to inspection under Section 5.28.070(D);
5. 
Is within any of the following categories:
a. 
Within five years immediately preceding the application, has been convicted of a felony crime in any jurisdiction involving: theft, fraud, receipt of stolen property, financial crime (including money laundering and embezzlement), violence, sale of a controlled substance as specified in Health and Safety Code Sections 11054 through 11058, or any offense of moral turpitude;
b. 
Within three years immediately preceding the application, has been convicted of any offense listed in subsection (D)(5)(a) of this section that has been made the subject of Penal Code Section 17(b);
c. 
Within five years immediately preceding the application, has been convicted of any offense involving deceptive trade practices or other illegal business practices reasonably related to the nature of the conduct of the secondhand dealer or pawnbroker business. For the purposes of this section, “convicted” means a plea or verdict of guilty or a conviction following a plea of nolo contendere;
6. 
Has failed to provide proof of any application requirement;
7. 
Cannot comply with the requirements of this chapter (including, for example, Section 5.28.060, Retention of property for holding period).
E. 
Forfeiture. Once issued, the license is subject to forfeiture based on violation of any of the following conditions: (Business and Professions Code Section 21643; Financial Code Section 21301(b).)
1. 
The business shall be carried on only at the location designated on the license. The license shall designate all locations where property belonging to the business is stored. Property of the business may be stored at locations not designated on the license only with the written consent of the chief or designee.
2. 
The license (or a copy of it), certified by the city, shall be displayed on the premises in plain view of the public. (Business and Professions Code Section 21642(b)(2); Financial Code Section 21301(b)(2).)
3. 
The licensee shall not engage in any act which is in violation of this chapter, or of Business and Professions Code Sections 21640 through 21643 (secondhand dealer) or Financial Code Sections 21300.1 through 21306 (pawnbroker), or of the terms and conditions of any use permit issued by the city.
4. 
The licensee shall not be convicted of an attempt to receive stolen property or any other offense involving stolen property. For the purposes of this subsection, “convicted” means a plea or verdict of guilty or a conviction following a plea of nolo contendere. Any action that the chief of police, the sheriff, or, where appropriate, the police commission is permitted to take following that conviction may be taken when the time for appeal has elapsed, the judgment of conviction has been affirmed on appeal, or an order granting probation is made suspending the imposition of sentence, irrespective of a subsequent order under Section 1203.4 of the Penal Code.
Notwithstanding the above, no person shall be denied a secondhand dealer’s/pawnbroker’s license, nor shall such license be forfeited, solely on the grounds that he or she violated any provision contained in this Article 4 (commencing with Section 21625), Article 5 (commencing with Section 21650), of the Business and Professions Code, or any provision contained in Chapter 2 (commencing with Section 21200) of Division 8 of the Financial Code, unless the violation demonstrates a pattern of conduct. (Business and Professions Code Section 21642; Financial Code Section 21300.)
(Ord. 2014-003 § 1, 2014 (part))
A. 
Requirement. Each secondhand dealer shall report daily, or on the first working day after receipt or purchase, to the chief all tangible personal property in accordance with Business and Professions Code Sections 21628 and 21631. (The report need not include firearms which are reported to the Department of Justice.) A transaction report is not required if the report of an acquisition of the same property from the same customer has been submitted within the preceding twelve months. (Business and Professions Code Section 21628.1.)
B. 
Contents of transaction report. The transaction report includes, but is not limited to:
1. 
Regarding the seller or pledger:
a. 
Name and current address;
b. 
Verified identification;
c. 
Certification by the seller or pledger that he or she is the owner of the property or has the authority of the owner;
d. 
Certification by the seller or pledger that to his or her knowledge and belief the information is true and complete;
e. 
A legible fingerprint.
2. 
Regarding the tangible personal property:
a. 
Complete and accurate description of the serialized property;
b. 
Complete and reasonably accurate description of nonserialized property;
c. 
Photograph(s) of the property (required only when the property will be stored outside the city limits).
C. 
Form of electronic transaction reports. The licensee shall submit report forms in the format approved by the Department of Justice, consisting of an original and two copies if the report is submitted in hard copy. Or, the licensee may instead submit report forms electronically, in the format approved by the Department of Justice, by using LeadsOnline or other city-approved electronic format and submitting both a thumbprint and photos of the seller and the items. (Business and Professions Code Section 21633.)
One copy of each transaction report shall be retained by the secondhand dealer in the place of business for at least three years, and the dealer shall make this transaction report available for inspection by any law enforcement officer. (Business and Professions Code Section 21633.)
(Ord. 2014-003 § 1, 2014 (part))
A. 
Holding period. Each secondhand dealer shall retain in his or her possession for a period of at least thirty days all tangible personal property for which a transaction report was required to be filed under Section 5.28.050. The thirty-day period begins on the date the report was made to the chief. (Business and Professions Code Section 21636(a).) This section does not apply to personal property pledged to a pawnbroker with respect to the redemption of personal property by the pledgor. (Business and Professions Code Section 21638.5.)
B. 
Inspection of property. During the thirty-day holding period, the secondhand dealer shall produce any tangible personal property for inspection by any peace officer who requests it. Tangible personal property which is stored off the business premises shall be produced at the licensee’s business premises within one business day of a request. Due to the necessity to secure the property and make it available for inspection, the city will not issue a license to a secondhand dealer who does not have a fixed, identified place for storage that is within ten miles of the city limits.
C. 
Peace officer hold on property. Whenever a peace officer has probable cause to believe that tangible personal property, except such property excepted by Business and Professions Code Section 21647, is stolen and in the possession of a secondhand dealer, the officer may place a hold on the property for up to ninety days. During that period, the secondhand dealer shall not release or dispose of the property (except as authorized under Business and Professions Code Section 21647(a)). When the property subject to hold is no longer required for the criminal investigation, the police department shall release the hold on the property. (Business and Professions Code Section 21647.)
(Ord. 2014-003 § 1, 2014 (part))
A. 
State license number. It is unlawful for any person required to be licensed under this chapter to publicly advertise without including the license number. (Business and Professions Code Section 21636.6; Financial Code Section 21301.1.)
B. 
No promise of repurchase. No secondhand dealer shall promise a seller of tangible personal property that the seller may repurchase the property. (Business and Professions Code Section 21636.5.)
C. 
No transactions with minor. No transactions that require reporting under Section 5.28.050 shall be engaged in with a minor (under eighteen years). (Business and Professions Code Section 21643.)
D. 
Inspections. A city police officer may make reasonable inspections of a licensed business under this chapter during normal operating hours, to enforce this chapter.
(Ord. 2014-003 § 1, 2014 (part))
A violation of this chapter constitutes a misdemeanor (Business and Professions Code Section 21645; Financial Code Section 21307). The city may enforce this chapter by any means allowed by law.
(Ord. 2014-003 § 1, 2014 (part))