By Barrientos                                          S.B. No. 963
         76R7745 T                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to law enforcement procedures for electronically obtaining
 1-3     data from pawn shops, recording thumbprints on transaction records,
 1-4     and holding hearings for recovery of stolen property.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1.  The Texas Pawnshop Act (Chapter 371, of the Texas
 1-7     Finance Code), Section 371.003, is amended to read as follows:
 1-8           Sec. 371.003.  Definitions.  In this chapter:
 1-9           (1)  "Applicable liabilities" include trade or other accounts
1-10     payable; accrued sales, income, or other taxes; accrued expenses;
1-11     and notes or other payables that are unsecured or secured in whole
1-12     or part by current assets.  The term does not include a liability
1-13     secured by assets other than current assets.
1-14           (2)  "Chief law enforcement official" means the sheriff of
1-15     the county in which a pawnshop is located or, if a pawnshop is
1-16     located in a municipality, the police chief of the municipality in
1-17     which the pawnshop is located.
1-18           (3)  "Commissioner" means the consumer credit commissioner.
1-19           (4)  "Current assets" include an investment made in cash,
1-20     bank deposits, merchandise inventory, and loans due from customers,
1-21     excluding the pawn service charge.  The term does not include an
1-22     investment made in:
1-23                 (a)  fixed assets of real estate, furniture, fixtures,
1-24     or equipment;
 2-1                 (b)  stocks, bonds, or other securities; or
 2-2                 (c)  prepaid expenses or other general intangibles.
 2-3           (4)  "Designated law enforcement official" means any law
 2-4     enforcement official or employee working for a recognized law
 2-5     enforcement agency, who is designated by the Chief law enforcement
 2-6     official over the jurisdiction in which the pawn shop operates, to
 2-7     monitor and work with pawn shops.
 2-8           (5)  "Goods" means tangible personal property.
 2-9           (6)  "Misappropriated" means stolen, embezzled, converted, or
2-10     otherwise wrongfully appropriated against the will or without the
2-11     effective consent of the rightful owner.
2-12           (7)  "Net assets" means the book value of current assets less
2-13     applicable liabilities.
2-14           (8)  "Pawnbroker" means a person engaged in the business of:
2-15                 (a)  lending money on the security of pledged goods; or
2-16                 (b)  purchasing goods on condition that the goods be
2-17     redeemed or repurchased by the seller for a fixed price within a
2-18     fixed period.
2-19           (9)  "Pawnshop" means a location at which or premises in
2-20     which a pawnbroker regularly conducts business.
2-21           (10)  "Pawn transaction" means the pledging with a pawnbroker
2-22     of a single item of goods as security for a loan of money.
2-23           (11)  "Pledged goods" means goods deposited with or otherwise
2-24     delivered into the possession of a pawnbroker in connection with a
2-25     pawn transaction.
2-26           (12)  "Pledgor" means an individual who pledges goods to a
2-27     pawnbroker in connection with a pawn transaction.
 3-1           SECTION 2.  The Texas Pawnshop Act (Chapter 371, Texas
 3-2     Finance Code), is amended by adding Section 371.186 to read as
 3-3     follows:
 3-4           Sec. 371.186.  PROVIDING DATA TO LAW ENFORCEMENT OFFICIALS BY
 3-5     ELECTRONIC MEANS.  (a)  In this section, "reportable data" means
 3-6     the information required to be recorded by pawnbrokers for pawn
 3-7     transactions  under Sections 371.157 of this Act and the
 3-8     information required to be recorded by pawnbrokers for purchase
 3-9     transactions under Section 371.177 of this Act.
3-10           (b)  A Chief law enforcement official may, by formal action
3-11     of the governing body of the county or municipality, require
3-12     reporting pawnbrokers within the jurisdiction of such official to
3-13     provide all reportable data to a designated law enforcement
3-14     official by electronic means, in lieu of the paper documents, as
3-15     described in this section.
3-16           (c)  This section applies only to a pawnbroker who, at the
3-17     time of receipt of written notice from a Chief law enforcement
3-18     official under subsection (d) of this section, possesses and uses
3-19     the computer equipment capable of complying with the requirements
3-20     for providing reportable data under this section and, for the most
3-21     recent preceding period of January 1 through December 31, conducted
3-22     at least 1,200 pawn and or purchase transactions.  A pawnbroker who
3-23     becomes eligible for application of this section remains eligible
3-24     regardless of the number of pawn and or purchase transactions
3-25     conducted in subsequent periods.
3-26           (d)  If the pawnbroker possesses and uses adequate computer
3-27     equipment, the pawnbroker shall, before the end of the six-month
 4-1     period after the date of the receipt of the notice from the Chief
 4-2     law enforcement official, make available all reportable data to the
 4-3     designated law enforcement official in an ASCII text form utilizing
 4-4     the Texas uniform reporting format as prescribed by the
 4-5     commissioner or a format agreed upon by the Chief law enforcement
 4-6     official and the pawnbroker.  The data shall be reported on
 4-7     reusable diskette media provided by the law enforcement official,
 4-8     or on a secure telephone modem transmission, or hosted bulletin
 4-9     board system that is mutually acceptable to the reporting
4-10     pawnbroker and the designated law enforcement official.  A
4-11     pawnbroker who does not possess and use adequate computer hardware
4-12     and software shall comply with the requirements of this section
4-13     within 180 days from the date the pawnbroker obtains capable
4-14     computer hardware and software.  A pawnbroker is not responsible
4-15     for any delay that results from the law enforcement official's
4-16     delay in facilitating the receipt of the data.
4-17           (e)  The medium in which a pawnbroker provides data to the
4-18     designated law enforcement official must contain the reportable
4-19     data for all transactions during a particular business period of
4-20     not less than one business day and must be made available to be
4-21     picked up by or transmitted to the designated law enforcement
4-22     official by the end of the second business day after the business
4-23     period to which the data relates.
4-24           (f)  During a test period beginning on the date a pawnbroker
4-25     begins to provide reportable data under this section, the
4-26     pawnbroker shall continue to make available copies of each of the
4-27     underlying pawn or purchase transaction documents to enable the
 5-1     designated law enforcement official to ensure the proper operation
 5-2     of the system for providing the data.  The test period shall
 5-3     continue until the system is properly operating and transmitting
 5-4     data to the satisfaction of the designated law enforcement
 5-5     official.
 5-6           (g)  A pawnbroker is responsible for training the
 5-7     pawnbroker's employees in correct data reporting and shall make
 5-8     every effort to provide complete and accurate data to the
 5-9     designated law enforcement official.  If a pawnbroker or the
5-10     designated law enforcement official discovers an error in the
5-11     provision of reportable data by that pawnbroker, the pawnbroker
5-12     shall be allowed a period of 30 days after the date of receipt of
5-13     notice from the law enforcement official to correct the error.  If
5-14     a pawnbroker experiences a computer malfunction, the pawnbroker
5-15     shall be allowed a period of 30 days in which to correct the
5-16     malfunction.  A pawnbroker who makes a bona fide effort to make the
5-17     appropriate system repairs during the periods prescribed by this
5-18     subsection is not in violation of this section during those
5-19     periods.  During those periods of error or malfunction, the
5-20     pawnbroker shall provide paper copies of the transaction tickets to
5-21     the designated law enforcement official and any reduced hold period
5-22     for purchased goods shall revert to the standard hold period for
5-23     property as set out in Section 371.182 of this Act.
5-24           (h)  All reportable data transmitted or furnished to any law
5-25     enforcement official under this Act is confidential and may be used
5-26     by that official only for official law enforcement related
5-27     investigations.  A pawnbroker may not be held liable for furnishing
 6-1     the information required by this Act to a law enforcement agency.
 6-2           (i)  In order to provide a uniform means of communication
 6-3     between the pawnbrokers and law enforcement, a Texas uniform
 6-4     reporting format shall be established.  A committee shall be formed
 6-5     under the direction of the Consumer Credit Commissioner consisting
 6-6     of representatives of the pawnbroker industry, law enforcement and
 6-7     computer software industry.  The committee shall review and
 6-8     recommend to the Commissioner, no later than November 1, 1999, a
 6-9     format to be designated by the Commissioner as the Texas uniform
6-10     reporting format for use by pawnbrokers transmitting reportable
6-11     data to law enforcement agencies.
6-12           SECTION 3.  The Texas Pawnshop Act (Chapter 371, Texas
6-13     Finance Code), is amended by adding Section 371.187 to read as
6-14     follows:
6-15           Sec. 371.187.  ALTERNATIVE RECIPIENTS OF ELECTRONIC DATA.  A
6-16     Chief law enforcement official may, by formal action of the
6-17     governing body of the county or municipality, require pawnbrokers
6-18     within the jurisdiction of such official to provide all reportable
6-19     data, pursuant to Section 351.186, to an alternative law
6-20     enforcement agency (but not more than one such alternative
6-21     recipient) in lieu of transmitting reportable data to that Chief
6-22     law enforcement official, for the purpose of operating a regional
6-23     clearinghouse of the reportable data.  That alternative recipient
6-24     shall be known as the designated law enforcement official for that
6-25     jurisdiction for reporting purposes only.
6-26           SECTION 4.  The Texas Pawnshop Act (Chapter 371, Texas
6-27     Finance Code), is amended by adding Section 371.188 to read as
 7-1     follows:
 7-2           Sec. 371.188.  POLICE HOLDS.  (a)  If any law enforcement
 7-3     official has reasonable suspicion to believe that property in the
 7-4     possession of a pawnbroker has been misappropriated, the official
 7-5     may place a hold order on the property as provided by this section.
 7-6           (b)  Any law enforcement official may place a hold order
 7-7     verbally, but if the pawnbroker does not receive a written order
 7-8     within 10 days after the date of the verbal order, the verbal hold
 7-9     order automatically expires.  The term of a written hold order may
7-10     not exceed 60 days from the earlier of the date of the verbal hold
7-11     order or the date of receipt by the pawnbroker of the written hold
7-12     order.  If there is an unexpected delay in the investigation
7-13     relating to the property, the law enforcement official may extend
7-14     the term of the hold order for up to an additional 30 days by
7-15     notifying the pawnbroker in writing.  The hold order shall
7-16     automatically expire upon expiration of the hold period and/or
7-17     extension.
7-18           (c)  A hold order must specify:
7-19                 (1)  the name and address of the pawnbroker;
7-20                 (2)  the name, title, identification number and phone
7-21     number of the law enforcement official placing the hold order;
7-22                 (3)  a complete description of the property to be held,
7-23     including model number and serial number, if applicable, and the
7-24     ticket number assigned to the property;
7-25                 (4)  the name of the person reporting the property to
7-26     be misappropriated, if known;
7-27                 (5)  the expiration date of the holding period; and
 8-1                 (6)  the name of the law enforcement agency that
 8-2     prepared the investigative report and the number of the report the
 8-3     investigation is being based upon.
 8-4           (d)  A written hold order may be transmitted to the
 8-5     pawnbroker by facsimile machine, mail, or personally delivered.
 8-6           (e)  Except as provided by this subsection, the pawnbroker
 8-7     may not release or dispose of property subject to a hold order
 8-8     except under a search warrant, court order, release authorization
 8-9     from the official placing the item on hold, seizure by a law
8-10     enforcement official, or the expiration of the hold period.  A
8-11     pawnbroker shall release property to the custody of a law
8-12     enforcement official on the official's request for use in a
8-13     criminal investigation if the official has furnished the pawnbroker
8-14     with a written receipt for the property.  The release of the
8-15     property to the custody of the official is not considered to be a
8-16     waiver or release of the pawnbroker's rights or interest in the
8-17     property.  On the earlier of the completion of the criminal
8-18     investigation or the expiration of the hold period, the property
8-19     shall be returned to the pawnbroker who released it unless a court
8-20     order provides for other disposition.  If other disposition is
8-21     ordered, the court may order the pledgor or seller to pay
8-22     restitution to the pawnbroker in the amount received by the pledgor
8-23     or seller for the property, plus accrued pawn service charges to
8-24     the date of seizure, in the case of pawn transactions, and
8-25     reasonable attorney's fees and costs.
8-26           SECTION 5.  The Texas Pawnshop Act (Chapter 371, Texas
8-27     Finance Code), Section 371.182 is amended to read as follows:
 9-1           Sec. 371.182.  HOLD PERIOD.  A pawnbroker [The commissioner]
 9-2     shall [designate a reasonable] hold for not less than 20 calendar
 9-3     days [period before a sale or other disposition of] an item of
 9-4     tangible personal property purchased or otherwise acquired from the
 9-5     general public before the property may be modified, changed, sold,
 9-6     or disposed of in any manner [by a pawnbroker and offered for sale
 9-7     or other disposition by the pawnbroker].  The Commissioner may
 9-8     provide for a hold period of 10 days upon written application by a
 9-9     pawnbroker.  A reduction in the hold period may be granted only if
9-10     the pawnbroker and the chief law enforcement officer have
9-11     implemented a procedure for transmitting reportable electronic data
9-12     under Sections 371.186 or 371.187 of this Act.  An application for
9-13     a shorter hold period must be approved by the Chief law enforcement
9-14     official before the application is submitted to the Commissioner by
9-15     the pawnbroker.
9-16           SECTION 6.  The Texas Pawnshop Act (Chapter 371, Texas
9-17     Finance Code), Section 371.157, is amended to read as follows:
9-18           Sec. 371.157.  Pawn Ticket.  (a)  A pawnbroker, at the time a
9-19     pawn transaction is entered, shall deliver to the pledgor a pawn
9-20     ticket or other memorandum that clearly shows:
9-21                 (1)  the name and address of the pawnshop;
9-22                 (2)  the pledgor's name, address, telephone number, and
9-23     physical description and [a driver's license number, military
9-24     identification number, identification certificate number, or other
9-25     official number that can identify the pledgor] the number of the
9-26     unexpired identification of the pledgor as required in section
9-27     371.174;
 10-1                (3)  the date of the transaction;
 10-2                (4)  an identification and complete description of the
 10-3    pledged goods, including serial numbers if reasonably available;
 10-4                (5)  the amount of cash advanced or credit extended to
 10-5    the pledgor, designated as "Amount Financed";
 10-6                (6)  the amount of the pawn service charge, designated
 10-7    as "Finance Charge";
 10-8                (7)  the total amount, consisting of the amount
 10-9    financed plus the finance charge, that must be paid to redeem the
10-10    pledged goods on the maturity date, designated as "Total of
10-11    Payments";
10-12                (8)  the "Annual Percentage Rate," computed according
10-13    to regulations issued by the Federal Reserve Board under the Truth
10-14    in lending Act (15 U.S.C.  Section 1601 et seq.), as amended;
10-15                (9)  the maturity date of the pawn transaction; and
10-16                (10)  a statement that:
10-17                      (A)  the pledgor is not obligated to redeem the
10-18    pledged goods; and
10-19                      (B)  the pledged goods may be forfeited to the
10-20    pawnbroker on the 61st day after the maturity date.
10-21          (b)  The pawnbroker shall record a legible thumbprint of the
10-22    pledgor on the forth part of the pawn ticket or that part
10-23    numerically filed and retained by the pawnbroker.
10-24          SECTION 7.  The Texas Pawnshop Act (Chapter 371, Texas
10-25    Finance Code), Section 371.177, is amended to read as follows:
10-26          Sec. 371.177.  Purchase of Used Personal Property.  (a)  A
10-27    pawnbroker may not purchase property from a person other than
 11-1    another pawnbroker or authorized vendor unless a record is
 11-2    established that contains:
 11-3                (1)  the seller's name, address, telephone number, and
 11-4    physical description and [a driver's license number, military
 11-5    identification number, identification certificate number, or other
 11-6    official number that can identify the seller] the number of the
 11-7    unexpired identification of the seller as required in section
 11-8    371.174;
 11-9                (2)  a complete description of the property, including
11-10    the serial number, if reasonably available, or other identifying
11-11    characteristics;
11-12                (3)  the seller's signed statement that the seller has
11-13    the right to sell the property.
11-14          (b)  The pawnbroker shall record a legible thumbprint of the
11-15    seller on the part of the purchase ticket numerically filed and
11-16    retained by the pawnbroker.
11-17          SECTION 8.  Chapter 47, Texas Code of Criminal Procedure,
11-18    Article 47.01a is amended to read as follows:
11-19          Art. 47.01a.  RESTORING [WHEN NO TRIAL IS PENDING] PROPERTY
11-20    TO OWNER.  (a)  [If a criminal action relating to stolen property
11-21    is not pending, a] A district judge, county court judge, statutory
11-22    county court judge, or justice of the peace having jurisdiction in
11-23    the county in which the property is being held or a municipal judge
11-24    having jurisdiction in the municipality in which the property is
11-25    being held may hold a hearing to determine the right to possession
11-26    of the property, upon the petition of an interested person, a
11-27    county, a city, or the state.
 12-1          SECTION 9.  This Act takes effect September 1, 1999.
 12-2          SECTION 10.  The importance of this legislation and the
 12-3    crowded condition of the calendars in both houses create an
 12-4    emergency and an imperative public necessity that the
 12-5    constitutional rule requiring bills to be read on three several
 12-6    days in each house be suspended, and this rule is hereby suspended.