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SB-1198 Pawnbrokers: fees and charges.(2023-2024)



Current Version: 08/19/24 - Chaptered

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SB1198:v96#DOCUMENT

Senate Bill No. 1198
CHAPTER 185

An act to amend Sections 21200.6 and 21201.2 of, and to amend and renumber Section 21200.9 of, and to add Section 21200.9 to, the Financial Code, relating to pawnbrokers.

[ Approved by Governor  August 19, 2024. Filed with Secretary of State  August 19, 2024. ]

LEGISLATIVE COUNSEL'S DIGEST


SB 1198, Roth. Pawnbrokers: fees and charges.
Existing law regulates the activities of pawnbrokers and makes a violation of these provisions a misdemeanor, as specified. Existing law authorizes the district attorney or the Attorney General, in the name of the people of the State of California, to bring an action to enjoin the violation or the threatened violation of a regulation made pertaining to certain provisions regulating pawnbrokers. Existing law authorizes a pawnbroker to collect a handling and storage charge for pawned articles at the time property is redeemed or a replacement loan is issued. Existing law establishes the maximum amount that may be charged based on the size of pawned articles, as specified.
This bill would additionally authorize a pawnbroker to collect a security charge and would increase the permitted handling, storage, and security charges depending on the size of the pawned articles, as specified. The bill would authorize a pawnbroker, in addition to other allowed charges, to collect a remote transaction fee, as specified.
Existing law permits a pawnbroker to charge a fee in the amount of up to $5 for services and costs pertaining to preparation of a 10-day notice when a pledged item is not redeemed during the loan period.
This bill would expand the services and costs for which the above-described noticing fee may be charged to include the mailing or electronic transmission of the notice, and would increase the maximum amount of the fee to $7.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 21200.6 of the Financial Code is amended to read:

21200.6.
 (a) In addition to other allowed charges, at the time property is redeemed or a replacement loan is issued pursuant to Section 21201.5, the pawnbroker may collect a handling, storage, and security charge for pawned articles. The maximum amount that may be charged pursuant to this section is in accordance with the following schedule:
(1) Five dollars ($5) or 2.5 percent of the loan amount for any article that can be contained within one cubic foot.
(2) Ten dollars ($10) or 2.5 percent of the loan amount for any article that cannot be contained within one cubic foot, but can be contained within three cubic feet.
(3) Twenty dollars ($20) or 2.5 percent of the loan amount for any article that cannot be contained within three cubic feet, but can be contained within six cubic feet.
(4) Thirty dollars ($30) or 2.5 percent of the loan amount for any article that cannot be contained within six cubic feet and five dollars ($5) for each additional cubic foot in excess of six cubic feet.
(b) For purposes of this section, cubic feet shall be determined by multiplying the width of an article, at its greatest width, by the depth of an article, at its greatest depth, by the height of an article, at its greatest height.

SEC. 2.

 Section 21200.9 of the Financial Code is amended and renumbered to read:

21200.10.
 No licensed pawnbroker shall promise any seller of tangible personal property that the seller may repurchase property sold to the pawnbroker.

SEC. 3.

 Section 21200.9 is added to the Financial Code, to read:

21200.9.
 In addition to other allowed charges, a pawnbroker may collect a remote transaction fee, if the pledgor elects to request a replacement loan or to redeem a loan through electronic means, of up to 3.0 percent of the transaction amount to cover the recurring costs associated with software applications.

SEC. 4.

 Section 21201.2 of the Financial Code is amended to read:

21201.2.
 If the pledgor fails to redeem any pawned item during the loan period, thereby obliging the pawnbroker to mail or electronically transmit the notice required under Section 21201, the pawnbroker may charge a fee of up to seven dollars ($7) for services and costs pertaining to the preparation and mailing or electronic transmission of the notice, in addition to any other allowed charges.