130th Ohio General Assembly
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Sub. S. B. No. 171  As Reported by the Senate Insurance, Commerce and Labor Committee
As Reported by the Senate Insurance, Commerce and Labor Committee

127th General Assembly
Regular Session
2007-2008
Sub. S. B. No. 171


Senator Stivers 

Cosponsors: Senators Jacobson, Schuring, Schuler, Mumper 



A BILL
To amend sections 4727.01, 4727.08, 4727.11, 4737.01, 4737.04, and 4737.99 and to enact sections 4727.22, 4737.041, 4737.042, 4737.043, and 4737.044 of the Revised Code to make certain changes to the laws regulating pawnbrokers, secondhand dealers, and scrap metal dealers.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 4727.01, 4727.08, 4727.11, 4737.01, 4737.04, and 4737.99 be amended and sections 4727.22, 4737.041, 4737.042, 4737.043, and 4737.044 of the Revised Code be enacted to read as follows:
Sec. 4727.01.  As used in this chapter:
(A) "Pawnbroker" means a person engaged in the business of lending money on deposit or pledges of personal property, other than securities, printed evidence of indebtedness, titles, deeds, or bills of sale, at a total charge, rate of interest, or discount or other remuneration in excess of eight per cent per annum, and includes a person engaged in the business of purchasing personal property from another person with an agreement that the personal property will be made available to that other person for repurchase within an agreed-to time period and for an amount greater than the price originally paid to that other person for the purchase of the personal property.
(B) "Superintendent of financial institutions" includes the deputy superintendent for consumer finance as provided in section 1181.21 of the Revised Code.
(C) "Personal identification card" means a current and valid driver's license, military identification card, state identification card issued under sections 4507.50 to 4507.52 of the Revised Code, or a state identification card issued by another state on the condition that that card contains information substantially similar to the information contained on a state identification card issued under sections 4507.50 to 4507.52 of the Revised Code and also contains a photograph of the person to whom the card is issued.
Sec. 4727.08.  (A) Every person licensed as a pawnbroker shall keep and use separate pawn forms and purchase forms to be approved by the superintendent of financial institutions.
(B) The licensee shall record on the appropriate form for each pawn or purchase all of the following information:
(1) The date and time of the pledging or purchasing;
(2) The amount of the loan or the purchase price;
(3) The rate of interest and the charges to be paid on the loan;
(4) The time within which the pledgor is to redeem the pledged property;
(5) The name, age, and address of the pledgor or seller;
(6) A driver's license number, military identification number, or other personal identification number;
(7) A physical description of the pledgor or seller;
(8)(7) An accurate description of the pledged or purchased property, including the name of the manufacturer, any serial and model numbers, any identifying features, and any identifying letters or marks;
(9)(8) Any other disclosures required by federal law.
(C) A licensee shall make a copy of the pledgor or seller's personal identification card and shall attach that copy to the form required under division (B) of this section.
(D) A copy of each form used in a pawn or purchase shall be kept at all times in numerical order in an active or inactive file, as appropriate, and the licensee shall account for all form numbers.
(D)(E) The records and forms, at all times, shall be kept at the licensed location and available for inspection by the superintendent and by the chief of police of the municipal corporation or township in which the licensee's place of business is located or, if the place of business is not located within a municipal corporation or a township that has a chief of police, by the sheriff of the county in which the place of business is located. Upon demand of any of them, the licensee shall produce and show any records, forms, pledges, or purchases which are in the licensee's possession.
(E)(F) Except in the case of a pledged motor vehicle, watercraft, or outboard motor, the licensee shall keep all pledges and purchases at the licensee's place of business unless a pledgor, in writing, agrees otherwise at the time the pledge is made. If the item pledged for the pawn loan is a motor vehicle, watercraft, or outboard motor, the licensee shall take possession of both the motor vehicle, watercraft, or outboard motor and the certificate of title to the motor vehicle, watercraft, or outboard motor and shall keep the certificate at the licensee's place of business but, upon notification to the pledgor, may keep the motor vehicle, watercraft, or outboard motor at a location other than the licensee's place of business. No pledge shall be removed from the place of business for the licensee's personal use or gain.
(F)(G) Every person licensed as a pawnbroker under this chapter shall keep and use an intelligible set of books and records in the English language in complying with this chapter with respect to recording the details of each purchase or loan. Except as provided in division (J)(K) of this section, all information required to be recorded by this chapter shall be entered in a bound book or on loose-leaf, permanent forms used exclusively for that purpose. Forms shall be identical and consecutively numbered, and each shall contain two or more pages. One part of each form shall be detachable and, when completed, shall serve as the statement to be given by the licensee to the pledgor or seller as provided by section 4727.07 of the Revised Code, the. The remaining part of the form shall be retained in the licensee's permanent records. All forms shall be accounted for.
(G)(H) No licensee shall require a borrower to affix the borrower's signature to a blank or partially filled out pawn form or other record.
(H)(I) Every licensee shall preserve the licensee's books, forms, accounts, and records for at least two years after making the final entry regarding any purchase or pledge of property recorded therein.
(I)(J) All pawn and purchase forms, legal notices, and payment receipt forms shall reflect the name under which the licensee is registered with the superintendent and the complete address of the place of business.
(J)(K) Notwithstanding any other provision of this chapter, a licensee may use other methods of recording data, keeping records, and keeping books, such as electronic or computerized methods, in lieu of the methods described in this section, provided written printouts or hard copies of the required data are readily available in a form approved, in advance, by the superintendent.
Sec. 4727.11.  (A) If a pledgor fails to pay interest to a person licensed as a pawnbroker on a pawn loan for two months from the date of the loan or the date on which the last interest payment is due, the licensee shall notify the pledgor by mail, with proof of mailing, to the last place of address given by the pledgor, that unless the pledgor redeems the pledged property or pays all interest due and storage charges within thirty days from the date the notice is mailed, the pledged property shall be forfeited to the licensee. If the pledgor fails to redeem or pay all interest due and storage charges within the period specified in the notice, the licensee becomes the owner of the pledged property.
(B) In the event that any article or property is redeemed by a person other than the pledgor, the pledgor shall sign the pledgor's copy of the statement required under section 4727.07 of the Revised Code, which copy shall be presented by the person to the licensee. The licensee shall verify the name of the person redeeming the article or property, and shall record the person's name and driver's license number, or other personal identification number, on the licensee's copy of the statement, and shall require the person to sign this copy, shall make a copy of the person's personal identification card, and shall attach that copy to the licensee's copy of the statement.
(C) In the event that any articles or property pledged are lost or rendered inoperable due to negligence of the licensee, the licensee shall replace the articles or property with identical articles or property, except that if the licensee cannot reasonably obtain identical articles or property, the licensee shall replace the articles or property with like articles or property.
(D) When an account is paid in full, the licensee shall return the pledged article immediately to the pledgor. In the event the pledgor sells, transfers, or assigns the pledge, the licensee shall verify the name of the person redeeming the pledge and record that person's name, driver's license number, and signature on the permanent copy of the statement of pledge required pursuant to section 4727.07 of the Revised Code and shall make a copy of the person's personal identification card and attach that copy to that statement. The licensee also shall obtain the signature of the pledgor, or other person redeeming the pledge, upon a separate record of the transaction, that acknowledges the total dollar amount paid for redemption and the date of redemption. All records shall be kept in the licensee's place of business.
Sec. 4727.22.  A licensee may use an electronic device that decodes and records information contained in the metallic strip on a personal identification card to record a person's name, address, and photograph in lieu of making a copy of a person's personal identification card to comply with the requirements of sections 4727.08 and 4727.11 of the Revised Code, on the condition that the licensee retains that recorded information and makes it available in accordance with the requirements to make copies available as described in those sections.
Sec. 4737.01.  (A) As used in this chapter, "personal identification card" has the same meaning as in section 4727.01 of the Revised Code.
(B) A person other than a scrap metal dealer, as defined in section 4737.04 of the Revised Code, purchasing, selling, exchanging, or receiving secondhand articles of any kind other than special purchase articles as defined in section 4737.04 of the Revised Code, scrap iron, old and scrap metal, canvas, rope, branded bottles, junk or lead pipe, except plow irons, old stoves, and furniture, shall post in a conspicuous place in or upon his the person's shop, store, wagon, boat, or other place of business, a sign having his the person's name and occupation legibly inscribed thereon, and shall keep a separate record book, open to inspection by any law enforcement officer, or electronic file in which shall be written, in the English language, at the time of the purchase or exchange of such articles, a description thereof, the name, description, and residence of the person from whom purchased and received, and the day and hour time when such purchase or exchange was made, and shall make and keep a copy of the person's personal identification card. Every entry shall be numbered consecutively, commencing with number one.
(B) Any person, prior to purchasing any secondhand article of furniture or secondhand electrical or gas appliance or equipment for the purpose of resale to the general public, shall demand to examine the seller's driver's or commercial driver's license or identification card issued under sections 4507.50 to 4507.52 of the Revised Code and one additional type of card typically used for identification purposes.
The purchaser shall keep a written record of the number of the license or identification card and the type and number of the other identification card accepted together with the date of purchase, the name and address of the seller, and a description of the article purchased. The purchaser shall retain the written record book or electronic file and copies of personal identification cards for at least one year after the purchase or exchange date and shall make the record or file and copies available for inspection by any law enforcement officer at all reasonable times. For the purposes of this division, the purchaser may utilize the written record he is required to keep where applicable under division (A) of this section and add to it the information required by this division.
Sec. 4737.04. (A) As used in this section and sections 4737.041, 4737.042, and 4737.043 of the Revised Code:
(1) "Scrap metal dealer" means a person who purchases or receives scrap metal.
(2) "Special purchase article" means all of the following:
(a) Beer kegs;
(b) Cable, wire, electrical components, and other equipment used in providing cable service or any utility service, including, but not limited to, copper or aluminum coverings, housings, or enclosures related thereto;
(c) Grave markers, sculptures, plaques, and vases made out of metal, the appearance of which suggest that the articles have been obtained from a cemetery;
(d) Guard rails for bridges, highways, and roads; highway and street signs; street light poles and fixtures; manhole covers, water meter covers, and other similar types of utility access covers; traffic directional and control signs and light signals, metal marked with the name of a political subdivision of the state, and other metal articles that are purchased and installed for use upon authorization of the state or any political subdivision of the state;
(e) Historical, commemorative, and memorial markers and plaques made out of metal;
(f) Four-wheel metal carts, commonly referred to as "grocery carts," that are generally used by individuals to collect and transport consumer goods while shopping;
(g) Four-wheel metal carts, commonly referred to as "metal bossies," that are used to transport or merchandise food products that are stored in crates, shells, or trays.
(3) "Common recycled matter" means bottles and other containers made out of steel, tin, or aluminum and other consumer goods that are metal that are recycled by individual consumers and not in the bulk or quantity that could be supplied or recycled by large business establishments. "Common recycled matter" does not include a metal tray used by a product producer, distributor, retailer, or agent of a product producer, distributor, or retailer as a means for the bulk transportation, storage, or carrying of retail containers of milk, baked goods, eggs, or bottled beverage products.
(4) "Consumer goods" has the same meaning as in section 1309.102 of the Revised Code.
(5) "Recyclable materials" means the metal materials described in division (B)(5) of this section, on the condition that those metal materials are not special purchase articles.
(6) "Motor vehicle" has the same meaning as in section 4501.01 of the Revised Code.
(B) Every scrap metal dealer in scrap iron, metal, and waste materials shall maintain a record book of records or electronic file, in which he the dealer shall keep an accurate and complete record of all articles purchased or received by him the dealer in the course of his the dealer's daily business. On and after the effective date of this amendment, every entry in the record book or electronic file shall be numbered consecutively. Every dealer shall maintain the record for each article purchased or received for a minimum period of one year after the date the dealer purchased or received the article. Said records shall contain all of the name, description, following:
(1) Name and residence of the person from whom said articles were purchased or received and the a copy of that person's personal identification card;
(2) The date and hour when such purchases or exchange were made time the scrap metal dealer purchased or received the articles;
(3) If the seller or provider of the articles arrives at the dealer's place of business in a motor vehicle, the license plate number of that motor vehicle along with the state that issued the license plate;
(4) For metal articles that are not recyclable materials, a full and accurate description of each article purchased or received by the dealer that includes identifying letters or marks written, inscribed, or otherwise included on the article and the name and maker of the article if known;
(5) For recyclable materials that are not special purchase articles, a scrap metal dealer shall use the following category codes to identify the recyclable materials that the dealer receives:
(a) "Number one copper," which includes clean copper pipe, clean copper wire, or other number one copper that does not have solder, paint, or coating;
(b) "Number two copper," which includes unclean copper pipe, unclean copper wire, or other number two copper;
(c) "Sheet copper," which includes copper roofing, copper gutters, copper downspouts, and other sheet copper;
(d) Insulated copper wire";
(e) "Aluminum or copper radiators," which includes aluminum radiators, aluminum copper radiators, and copper radiators;
(f) "Red brass," which includes red brass values and other red brass;
(g) "Yellow brass," which includes yellow brass fixtures, yellow brass valve and fitting, ornamental brass, and other yellow brass;
(h) "Aluminum sheet";
(i) "Aluminum extrusions," which includes aluminum bleachers, aluminum benches, aluminum frames, aluminum pipe, and other aluminum extrusions;
(j) "Cast aluminum," which includes aluminum grills, lawnmower decks made of aluminum, aluminum motor vehicle parts and rims, and other cast aluminum;
(k) "Clean aluminum wire";
(l) "Unclean aluminum wire";
(m) "Aluminum exteriors," which includes aluminum siding, aluminum gutters and downspouts, aluminum shutters, aluminum trim, and other aluminum exterior items;
(n) "Contaminated aluminum";
(o) "Stainless steel," which includes, sinks, appliance housing, dishes, pots, pans, pipe, and other items made out of stainless steel;
(p) "Large appliances," which includes consumer and other appliances;
(q) "Miscellaneous steel," which includes steel grates, steel farm machinery, steel industrial machinery, steel motor vehicle frames, and other items made out of steel;
(r) "Sheet irons," which includes bicycles, motor vehicle body parts made of iron, and other items made using sheet iron;
(s) "Motor vehicle nonbody parts," which includes motor vehicle batteries, radiators, and other nonbody motor vehicle parts;
(t) "Catalytic converters";
(u) "Lead";
(v) Electric motors."
(C) All journal brasses, and other railroad metals, other than purchases and sales under sections 4973.13 to 4973.16, inclusive, of the Revised Code, shall be held by the dealer for a period of thirty days after being purchased or acquired.
Such (D) The records required under division (B) of this section shall be open for inspection by the representative of any law enforcement agency at and the director of public safety or the director's designated representative during all business hours. A scrap metal dealer shall provide a copy of those records to any law enforcement agency that requests the records or to the director or director's representative, upon request. Records submitted to any law enforcement agency pursuant to this section are not public records for purposes of section 149.43 of the Revised Code. A person who claims to own a stolen article that may be identified in those records, or an agent of that person, who provides proof of having filed a stolen property report with the appropriate law enforcement agency, may request those records. The law enforcement agency shall provide those records upon a request made by such a person or that person's agent, but the law enforcement agency shall redact information that reveals the name of the seller of any article and the price the dealer paid for any article the dealer purchased or the estimated value of any article the dealer received. The law enforcement agency shall determine which records to provide, based upon the time period that the alleged theft is reported to have taken place. A law enforcement agency may charge or collect a fee for providing records as required by this section.
(E) No scrap metal dealer shall purchase or receive any metal articles from a person who refuses to show the dealer the person's personal identification card.
The law enforcement agency that serves the jurisdiction in which a scrap metal dealer is located shall provide a list, as that agency determines appropriate, of the names and descriptions of persons known to be or who are suspected to be thieves or receivers of stolen property. No scrap metal dealer shall purchase or receive articles from any person identified on the list the dealer receives from the law enforcement agency.
No scrap metal dealer shall purchase or receive any special purchase articles from any person who is under eighteen years of age.
No scrap metal dealer shall purchase or receive any special purchase article without complying with division (B) of this section and divisions (B) and (C) of section 4737.041 of the Revised Code.
No scrap metal dealer shall purchase or receive more than one catalytic converter per day from the same person.
(F) Every scrap metal dealer shall post a notice in a conspicuous place on the dealer's premises notifying persons who may wish to transact business with the dealer of the penalties applicable to any person who does any of the following:
(1) Provides a false personal identification card to the dealer;
(2) With purpose to defraud, provides any other false information to the dealer in connection with the dealer's duty to maintain the records required under division (B) of this section;
(3) Commits a theft as described in section 2913.02 of the Revised Code.
Sec. 4737.041. A scrap metal dealer shall do all of the following with respect to each special purchase article the scrap metal dealer purchases or receives:
(A) Comply with the requirements of this section in addition to complying with the requirements of section 4737.04 of the Revised Code;
(B) Take a photograph of each special purchase article;
(C) Obtain from the seller or provider of the special purchase article proof that the seller or provider owns the special purchase article;
(D) If payment is rendered for the special purchase articles, issue a check for the purchase of the special purchase articles;
(E) Withhold payment for the purchase of the special purchase articles for a period of two days after the day the special purchase articles are purchased;
(F) If an asserted owner of stolen special purchase articles or that owner's agent provides proof of having filed a stolen property report with the appropriate law enforcement agency, make records describing special purchase articles the scrap metal dealer purchased or received after the alleged date of theft available for inspection to the asserted owner or owner's agent for a period of six months after the alleged date of theft of the articles, except that the scrap metal dealer shall withhold the name of the person from whom the special purchase articles were purchased or received and the amount paid for the special purchase articles.
Sec. 4737.042.  A scrap metal dealer and a person who purchases, sells, exchanges, or receives secondhand articles may use an electronic device that decodes and records information contained in the metallic strip on a personal identification card to record a person's name, address, and photograph in lieu of making a copy of a person's personal identification card to comply with the requirements of sections 4737.01, 4737.04, and 4737.041 of the Revised Code, on the condition that the dealer or person retains that recorded information and makes it available in accordance with the requirements to make copies available under those sections.
Sec. 4737.043.  Sections 4737.04 and 4737.041 of the Revised Code do not apply with respect to any of the following:
(A) The donation of articles to nonprofit organizations or to any other person, on the condition that the person donating the articles receives no payment or any other valuable consideration in exchange for or due to donating the articles;
(B) The sale or donation of common recycled matter;
(C) Sales transacted between a scrap metal dealer and an organization that is exempt from federal taxation under section 501(c)(3) of the "Internal Revenue Code of 1986," 100 Stat. 285, 26 U.S.C. 501(c)(3), as amended, and that collects, for its own fundraising purposes, scrap ferrous and nonferrous metals for recycling rather than disposal;
(D) Sales transacted between a scrap metal dealer and a government unit or another business, including a demolition company, public utility company, or another scrap metal dealer, on the condition that the government unit or business satisfies the following criteria:
(1) In the course of providing the government unit's or business's services to others or maintaining the government unit's or business's property, whether onsite or offsite, the government unit or business generates scrap ferrous and nonferrous metals for recycling rather than disposal.
(2) If a government unit, reference to the government unit as a bona fide unit of government can be readily found by the public.
(3) If the sales transaction involves a business, the business satisfies one of the following criteria:
(a) The business is registered with the secretary of state.
(b) The business advertises its services in a newspaper of general circulation, a telephone book, electronic media that is available to the public, or some other type of media that is owned and operated by a person other than the business.
(4) The government unit provides proof of compliance with division (D)(2) of this section or the business provides proof of compliance with division (D)(3) of this section to the scrap metal dealer with whom the government unit or business transacts business.
(E) Sales transacted between a scrap metal dealer and a person whose primary business is to create products that result in bulk quantities of ferrous and nonferrous metal used for recycling rather than disposal.
Sec. 4737.044. By analogy to Am. Financial Servs. Assn. et al. v. Cleveland, 112 Ohio St. 3d 170, 2006-Ohio-6043, citing Canton v. State, 95 Ohio St. 3d 149, 2002-Ohio-2005, syllabus, sections 4737.01 to 4737.043 of the Revised Code are intended as a comprehensive legislative enactment operating uniformly throughout this state, setting forth regulations concerning the purchase and sale of scrap metal, and prescribing a rule of conduct upon citizens generally. To assure uniform statewide scrap metal purchasing practices, no municipal corporation or other political subdivision shall enact or enforce any regulation or ordinance regulating the purchase or sale of scrap metal by a scrap metal dealer or that is in conflict with or in derogation of sections 4737.01 to 4737.043 of the Revised Code.
Sec. 4737.99.  (A) Except as specified in division divisions (B) and (C) of this section, whoever violates sections 4737.01 to 4737.11 of the Revised Code, shall be fined not less than twenty-five nor more than one thousand dollars and the costs of prosecution.
(B) Whoever violates division (F)(2) of section 4737.10 of the Revised Code is guilty of a misdemeanor of the fourth degree.
(C) Whoever violates division (E) of section 4737.04 of the Revised Code is guilty of a misdemeanor of the first degree.
Section 2. That existing sections 4727.01, 4727.08, 4727.11, 4737.01, 4737.04, and 4737.99 of the Revised Code are hereby repealed.
Section 3. During the first year of the 129th General Assembly, the President of the Senate or Speaker of the House of Representatives shall initiate creation of a joint select committee of the Senate and House of Representatives for the purpose of considering the effectiveness of this act in deterring crime and the costs of complying with this act to industries affected by this act. The President of the Senate and Speaker of the House of Representatives shall create the joint select committee in accordance with the Joint Rules of the Senate and House of Representatives for the 129th General Assembly for creation of a joint select committee.
The joint select committee shall hold public hearings at which time representatives of the Ohio Municipal League, the Ohio Prosecuting Attorneys Association, and the Ohio Sheriff's Association; representatives of the scrap metal recycling industry; and other interested parties may present testimony on the affect of this act on metals theft rates, theft deterrence, criminal enforcement and prosecution, and economic and administrative burdens on industry. The joint select committee shall provide advance notice of its hearings to, and shall solicit comments in advance of those hearings from, the Ohio Municipal League, Ohio Prosecuting Attorneys Association, Ohio Sheriff's Association, representatives of the scrap metal recycling industry, and other interested parties that the joint select committee determines should receive notice.
The joint select committee shall issue a report summarizing the effectiveness and impacts of this act and submit the report to the President of the Senate and Speaker of the House of Representatives. The Legislative Service Commission shall assist the joint select committee in preparing and finalizing the report required by this section.
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