Pawnbrokers

A pawnbroker is an individual or business that offers secured loans to people, with items of personal property used as collateral.

If an item is pawned for a loan, within a certain contractual period of time the customer may redeem it for the amount of the loan plus some agreed-upon amount for interest. If the loan is not paid within the time period, the pawned item will be offered for sale by the pawnbroker. Pawnbrokers also sell items that have been sold outright to them by customers.

Pawnbrokers are governed by a number of very specific requirements as to the receiving and sale of second hand goods. A pawnbroker must require every person attempting to sell or pawn second-hand goods to produce evidence as to that person’s identity. For 7 days after receiving second-hand goods a second-hand dealer or pawnbroker must keep the goods in the form in which they were received and without disposing of them in any way. A second-hand dealer or pawnbroker must keep, in the form and containing the information required by the regulations, accurate and complete records of every transaction, whether conducted on the business premises or elsewhere.

A pawnbroker must check second-hand goods in their possession and second-hand goods which they receive against any notice describing stolen goods served on him or her by a member of the police force. A pawnbroker who suspects for any reason that goods in their possession or which they receives may have been stolen must immediately inform a member of the police force. Pawnbrokers must be both registered as a second-hand dealer and authorised to carry on business as a pawnbroker by endorsement of their registration. Registration and regulation of pawnbrokers and second-hand dealers is covered by fair trading legislation in all states and territories.