CHAPTER 371. PAWNSHOPS - Texas Statutes

FINANCE CODE

TITLE 4. REGULATION OF INTEREST, LOANS, AND FINANCED TRANSACTIONS

SUBTITLE C. PAWNSHOPS

CHAPTER 371. PAWNSHOPS

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 371.001. SHORT TITLE. This chapter shall be known and may

be cited as the "Texas Pawnshop Act."

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.002. PURPOSES. The purposes of this chapter are to:

(1) prevent fraud, unfair practices, discrimination, imposition,

and abuse of state residents;

(2) exercise the state's police power to ensure a sound system

of making pawn loans and transfers of personal property by and

through pawnshops;

(3) prevent transactions in stolen property and other unlawful

property transactions by licensing and regulating pawnbrokers and

pawnshop employees;

(4) provide for licensing and investigation fees;

(5) provide minimum capital requirements for pawnbrokers;

(6) ensure financial responsibility to the state and its

residents and compliance with federal, state, and local law,

including rules and ordinances; and

(7) assist local governments in the exercise of their police

power.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.003. DEFINITIONS. In this chapter:

(1) "Applicable liabilities" include trade or other accounts

payable; accrued sales, income, or other taxes; accrued expenses;

and notes or other payables that are unsecured or secured in

whole or part by current assets. The term does not include a

liability secured by assets other than current assets.

(2) "Commissioner" means the consumer credit commissioner.

(3) "Current assets" include an investment made in cash, bank

deposits, merchandise inventory, and loans due from customers,

excluding the pawn service charge. The term does not include an

investment made in:

(A) fixed assets of real estate, furniture, fixtures, or

equipment;

(B) stocks, bonds, or other securities; or

(C) prepaid expenses or other general intangibles.

(4) "Goods" means tangible personal property.

(5) "Net assets" means the book value of current assets less

applicable liabilities.

(6) "Pawnbroker" means a person engaged in the business of:

(A) lending money on the security of pledged goods; or

(B) purchasing goods on condition that the goods may be redeemed

or repurchased by the seller for a fixed price within a fixed

period.

(7) "Pawnshop" means a location at which or premises in which a

pawnbroker regularly conducts business.

(8) "Pawn transaction" means the pledging with a pawnbroker of a

single item of goods as security for a loan of money.

(9) "Pledged goods" means goods deposited with or otherwise

delivered into the possession of a pawnbroker in connection with

a pawn transaction.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.004. COMPUTATION OF MONTH. (a) For the computation of

time in this chapter, a month is the period from a date in a

month to the corresponding date in the succeeding month. If the

succeeding month does not have a corresponding date, the period

ends on the last day of the succeeding month.

(b) For the computation of a fraction of a month, a day is equal

to one-thirtieth of a month.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.005. REGULATORY AUTHORITY. The legislature has

exclusive authority regarding the operation of pawnshops, except

for a matter delegated by this chapter to the commissioner. The

commissioner has the authority to regulate only a business

practice that requires a pawnshop license.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 1, eff. Sept. 1,

1999.

Sec. 371.006. RULEMAKING. (a) The Finance Commission of Texas

may adopt rules to enforce this chapter.

(b) A rule shall be entered in a permanent record book. The book

is a public record and shall be kept in the office of the

commissioner.

(c) A copy of a rule shall be mailed to each license holder, and

the rule may not take effect before the 21st day after the

earliest date on which all of the copies have been mailed.

(d) On application by any person and on payment of any

associated cost, the commissioner shall furnish the person a

certified copy of a rule adopted by the Finance Commission of

Texas.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 2, eff. Sept. 1,

1999; Acts 2001, 77th Leg., ch. 867, Sec. 99, eff. Sept. 1, 2001.

Sec. 371.007. STAGGERED RENEWAL OF LICENSES. (a) The Finance

Commission of Texas by rule may adopt a system under which

licenses issued under this chapter expire on various dates during

the year.

(b) For a year in which an expiration date is changed, a license

fee payable on the date of issuance shall be prorated according

to the number of months during which the license is valid.

(c) On renewal of a license on the new expiration date, the

total license fee is payable.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 2001, 77th Leg., ch. 867, Sec. 100, eff. Sept. 1,

2001.

SUBCHAPTER B. PAWNSHOP LICENSE

Sec. 371.051. PAWNSHOP LICENSE REQUIRED. A person may not

engage in business as a pawnbroker unless the person holds a

pawnshop license.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.052. ELIGIBILITY. (a) To be eligible for a pawnshop

license, an applicant must:

(1) be of good moral character;

(2) meet the net assets requirement of Section 371.072; and

(3) show that:

(A) the pawnshop will be operated lawfully and fairly under this

chapter; and

(B) the applicant or the applicant's owners and managers have

the financial responsibility, experience, character, and general

fitness to command the confidence of the public in the pawnshop's

operations.

(b) Subsection (a)(1) applies to each:

(1) operator and legal or beneficial owner if the applicant is a

business entity; and

(2) officer, owner of at least five percent of the shares

outstanding, and director if the applicant is a corporation.

(c) For purposes of a disqualification under Chapter 53,

Occupations Code, the commissioner is a licensing authority.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 14.748, eff.

Sept. 1, 2001.

Sec. 371.053. VERIFICATION OF APPLICANT'S NET ASSETS. If the

commissioner cannot verify that an applicant meets the net assets

requirement of Section 371.072, the commissioner may require a

finding, including a current balance sheet, by an independent

certified public accountant that:

(1) the accountant has reviewed the applicant's books and

records; and

(2) the applicant meets the net assets requirement.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.054. LICENSE APPLICATION. (a) This section applies to

an application for:

(1) an original pawnshop license;

(2) relocation of a pawnshop; or

(3) transfer of a pawnshop license and approval of a change in

the ownership of a pawnshop.

(b) An application must be made to the commissioner and must:

(1) be under oath;

(2) state:

(A) the full name and place of residence of the applicant;

(B) the full name and address of each member if the applicant is

a partnership;

(C) except as provided by Subsection (c), the full name and

address of each officer, shareholder, and director if the

applicant is a corporation;

(D) the location where the business is to be conducted; and

(E) other relevant information required by the commissioner; and

(3) be accompanied by the fees and proof of insurance required

by Section 371.055.

(c) The full name and address of each shareholder is not

required if the applicant is owned directly or beneficially by a

person who:

(1) is an issuer of securities who:

(A) has a class of securities registered under Section 12 of the

Securities Exchange Act of 1934 (15 U.S.C. Section 78l); or

(B) is required to file reports with the Securities and Exchange

Commission by Section 15(d) of the Securities Exchange Act of

1934 (15 U.S.C. Section 78o(d)); and

(2) has filed with the commissioner the information, documents,

and reports required by the Securities Exchange Act of 1934 (15

U.S.C. Section 77b et seq.) to be filed by the issuer with the

Securities and Exchange Commission.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.055. FEES; PROOF OF INSURANCE. An applicant must

submit with the application:

(1) an investigation fee of:

(A) $500 if the applicant does not hold a license; or

(B) $250 if the application:

(i) is for an additional license for a separate location; or

(ii) involves substantially identical principals and owners of a

licensed pawnshop at a separate location;

(2) an annual fee in an amount determined as provided by Section

14.107; and

(3) proof of general liability and fire insurance in a

reasonable amount and form required by the commissioner.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 2001, 77th Leg., ch. 1235, Sec. 20, eff. Sept. 1,

2001.

Sec. 371.056. BOND. (a) The commissioner may require that an

applicant file a bond with the application. The bond must be:

(1) satisfactory to the commissioner;

(2) in the amount set by the commissioner not to exceed $5,000

for each license; and

(3) issued by a surety qualified to do business in this state.

(b) The aggregate liability of the surety may not exceed the

amount of the bond.

(c) The bond must be in favor of this state for the use of this

state and the use of a person who has a cause of action under

this chapter against the pawnbroker.

(d) The bond must be conditioned on:

(1) the pawnbroker's compliance with this chapter and rules

adopted under this chapter; and

(2) the payment of all amounts that become due to this state or

to another person under this chapter.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.057. INVESTIGATION; NOTICE OF APPLICATION. (a) On

receipt of an application and the required fees, the commissioner

shall:

(1) conduct an investigation to determine whether to issue the

license; and

(2) give notice of the application to:

(A) the Department of Public Safety of the State of Texas;

(B) each local law enforcement agency in the county in which the

business is to be conducted; and

(C) each pawnbroker in the county in which the applicant

pawnshop is to be located.

(b) The notice to the department of public safety and local law

enforcement agencies must state the name and address of each

person required by Section 371.054 to be listed on the license

application.

(c) The commissioner shall give the department and local law

enforcement agencies a reasonable time to respond with

information concerning the listed persons or with any other

relevant information.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.058. PUBLIC HEARING. (a) On request, the commissioner

shall conduct a public hearing before issuing a pawnshop license.

(b) The commissioner shall give a pawnbroker that would be

affected by the granting of an application for a pawnshop license

an opportunity to appear, present evidence, and be heard for or

against the application.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.059. APPROVAL; ISSUANCE OF LICENSE. (a) Subject to

Subsection (b), the commissioner shall approve the application

and issue a license if the commissioner finds that the applicant

is eligible for the license.

(b) In a county with a population of 250,000 or more, the

commissioner shall approve an application for:

(1) an original license to operate a pawnshop at a facility that

is not an existing licensed pawnshop at the time the application

is filed if the proposed facility is not located within two miles

of a licensed pawnshop;

(2) the relocation of a licensed pawnshop to a facility that is

not an existing licensed pawnshop at the time the application is

filed if the facility where the pawnshop is to be relocated is

not located within one mile of a licensed pawnshop; and

(3) the relocation of a licensed pawnshop if at the time the

application is filed the pawnshop has been in operation at its

current location for at least three years, and the facility where

the pawnshop is to be relocated is either within one mile of its

existing location or, if in excess of one mile from its existing

location, not within one mile of another existing operating

pawnshop.

(c) Notwithstanding Subsection (b)(3), the commissioner may

approve an application for the relocation of a licensed pawnshop

that needs to relocate marginally further than one mile from its

existing location or that at the time the application is made has

not been in operation in its current location for at least three

years if the necessity for relocation was caused by circumstances

beyond the applicant's control.

(d) A determination of distance for purposes of this section is

based on a measurement taken from the front door of a facility to

the front door of the other facility. For a facility not in

existence at the time the application is filed, the location of

the front door of the proposed facility must be indicated on

architectural drawings or comparable professionally prepared

drawings depicting the facility and the entire boundary of the

lot or parcel of land to which the facility is to be attached.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 1399, Sec. 1, eff. Sept. 1,

1999.

Sec. 371.060. NOTICE OF DENIAL; HEARING. (a) If the

commissioner does not make a finding described by Section

371.059, the commissioner shall notify the applicant.

(b) An applicant who requests a hearing on the application not

later than the 30th day after the date of notification under

Subsection (a) is entitled to a hearing within 60 days after the

date of the request.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.061. PERIOD FOR FINAL DECISION TO APPROVE OR DENY.

Unless the applicant and the commissioner agree in writing to a

later date, the commissioner shall approve or deny the

application before the 61st day after the later of the date on

which:

(1) the application is filed and the required fees are paid; or

(2) a hearing on the application is completed.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.062. DISPOSITION OF FEES ON DENIAL OF APPLICATION. If

the commissioner denies the application, the commissioner shall

retain the investigation fee and shall return to the applicant

the annual license fee submitted with the application.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.063. LICENSE ISSUED BEFORE OCTOBER 1, 1981. A license

issued to a pawnshop before October 1, 1981, remains valid as

long as the pawnbroker complies with this chapter.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.064. ANNUAL LICENSE FEE; EXPIRATION. (a) Not later

than December 1, a pawnbroker shall pay to the commissioner for

each license held an annual fee in an amount determined as

provided by Section 14.107 for the year beginning the next

January 1.

(b) If the annual fee for a license is not paid before the 16th

day after the date on which written notice of delinquency of

payment has been given to the pawnbroker by the commissioner, the

license expires on the later of:

(1) that day; or

(2) December 31 of the last year for which an annual fee was

paid.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 1399, Sec. 2, eff. Sept. 1,

1999; Acts 2001, 77th Leg., ch. 1235, Sec. 21, eff. Sept. 1,

2001.

Sec. 371.066. TEMPORARY LICENSE. (a) The commissioner may

issue a temporary pawnshop license on receipt of an application:

(1) to transfer a license from one person to another; or

(2) for a license involving principals and owners that are

substantially identical to those of a pawnshop in operation at

the time of receipt of the application.

(b) A temporary license is effective until a permanent license

is issued or denied.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 3, eff. Sept. 1,

1999.

Sec. 371.067. CONTENTS AND DISPLAY OF LICENSE. (a) A license

must state:

(1) the name of the pawnbroker; and

(2) the address at which the business is to be conducted.

(b) A pawnbroker shall display a license at the place of

business provided on the license.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.068. MULTIPLE PLACES OF BUSINESS. (a) A separate

pawnshop license is required for each place of business operated

under this chapter.

(b) The commissioner may issue more than one license to a person

if the person complies with this chapter for each license.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.069. CHANGE OF OWNERSHIP. (a) An application for an

original pawnshop license or the transfer of a pawnshop license

is required if a change in direct or beneficial ownership of a

licensed pawnshop occurs.

(b) This section does not apply to a change in direct or

beneficial ownership of a licensed pawnshop if the pawnshop is

owned directly or beneficially by a person who:

(1) is an issuer of securities who is described by Section

371.054(c)(1);

(2) is described by Section 371.054(c)(2) and has submitted to

the commissioner each filing required by Section 15(d) of the

Securities Exchange Act of 1934 (15 U.S.C. Section 78o(d)) and

paid a filing fee of $100 with each; and

(3) has filed information on officers and directors of the

issuer or any licensed or intermediate subsidiary as required by

Section 371.054 for officers and directors of a corporation.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.070. TRANSFER OR ASSIGNMENT OF LICENSE. A pawnshop

license may be transferred or assigned only with the approval of

the commissioner.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.071. APPLICATION FOR RELOCATION. A pawnbroker who

wishes to move a pawnshop from the location provided on the

license must make application to the commissioner before the 30th

day preceding the date the pawnbroker moves.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 1399, Sec. 3, eff. Sept. 1,

1999.

Sec. 371.072. NET ASSETS REQUIREMENT. (a) Except as provided

by Subsection (b), a pawnbroker shall maintain net assets of at

least $150,000 that are used or readily available for use in the

business of each pawnshop.

(b) A pawnbroker who held a license under this chapter before

September 1, 1999, shall maintain net assets that are used or

readily available for use in the business for that existing

license of at least the amount required on August 31, 1999. The

net assets requirement of this subsection remains in effect

without regard to a change in ownership or relocation of the

license.

(c) Net assets must be represented by a capital investment

unencumbered by a lien or other encumbrance and subject to a

claim by a general creditor.

Text of subsec. (d) as amended by Acts 1999, 76th Leg., ch. 801,

Sec. 4

(d) Subject to Subsection (b), a pawnbroker shall maintain for

each pawnshop net assets, as that term was defined at the time

the license was issued, that are used or readily available for

use in the business of the pawnshop of at least the amount

required on:

(1) August 31, 1981, if the pawnbroker held a license on that

date; or

(2) June 20, 1987, if the pawnbroker held a license on that date

but did not hold a license on August 31, 1981.

Text of subsec. (d) as relettered from subsec. (f) and amended by

Acts 1999, 76th Leg., ch. 1399, Sec. 4

(d) In this section, "capital investment" means:

(1) common or preferred shares and capital or earned surplus as

those terms are defined by the Texas Business Corporation Act if

the pawnbroker is a corporation; or

(2) a substantial equivalent of items described by Subdivision

(1), as determined by generally accepted accounting principles,

if the pawnbroker is not a corporation.

Text of subsec. (e) as amended by Acts 1999, 76th Leg., ch. 801,

Sec. 4

(e) Subject to Subsection (d), net assets must be represented by

a capital investment unencumbered by a lien or other encumbrance

and subject to a claim by a general creditor.

Text of subsec. (e) as relettered from subsec. (g) and amended by

Acts 1999, 76th Leg., ch. 1399, Sec. 4

(e) Subsection (b) applies to a change in ownership that is:

(1) a transaction involving a different owner who had a

significant family or business relationship with a prior owner

before the transaction;

(2) a transaction in which:

(A) only the number or proportionate ownership of owners of a

business changes; and

(B) an individual who was not an owner before the transaction is

not an owner after the transaction; or

(3) a change in ownership that occurs by testate or intestate

disposition.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 4, eff. Sept. 1,

1999; Acts 1999, 76th Leg., ch. 1399, Sec. 4, eff. Sept. 1, 1999.

Sec. 371.073. APPOINTMENT OF AGENT. (a) A pawnbroker shall

maintain on file with the commissioner a written appointment of a

resident of this state as the pawnbroker's agent for service of

all judicial or other process or legal notice unless the

pawnbroker has appointed an agent under another statute of this

state.

(b) If a pawnbroker does not comply with this section, service

of all judicial or other process or legal notice may be made on

the commissioner.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

SUBCHAPTER C. PAWNSHOP EMPLOYEE LICENSE

Sec. 371.101. PAWNSHOP EMPLOYEE LICENSE REQUIRED. (a) An

individual who begins employment at a pawnshop must apply to the

commissioner for a pawnshop employee license not later than the

75th day after the date employment begins.

(b) The individual may continue employment until the license is

issued or denied.

(c) A pawnbroker may not employ an individual to write a pawn

transaction, buy or sell merchandise, or supervise another

employee who writes pawn transactions or buys or sells

merchandise unless the individual:

(1) has complied with Subsection (a) but has not been issued or

denied a license; or

(2) holds a pawnshop employee license.

(d) Subsection (c) does not apply to an individual who:

(1) has an ownership interest in the pawnshop license; and

(2) is named on the application.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 1399, Sec. 5, eff. Sept. 1,

1999.

Sec. 371.102. ELIGIBILITY. (a) To be eligible for a pawnshop

employee license, an individual must:

(1) be of good moral character and good business repute; and

(2) possess the character and general fitness necessary to

warrant belief that the individual will operate the business

lawfully and fairly under this chapter.

(b) For purposes of a disqualification under Chapter 53,

Occupations Code, the commissioner is a licensing authority.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 14.749, eff.

Sept. 1, 2001.

Sec. 371.103. LICENSE APPLICATION; FEES. (a) An application

for a pawnshop employee license must state:

(1) the applicant's name and address;

(2) the name of the pawnshop at which the applicant is employed;

(3) whether the applicant has:

(A) been convicted of or is under indictment for a crime;

(B) had a license to engage in an occupation, business, or

profession revoked or suspended; or

(C) been denied an occupational, business, or professional

license, including a pawnshop employee license, in this or

another state;

(4) if the applicant has had a license described by Subdivision

(3)(B) revoked or suspended, the reason for the action;

(5) each business or occupation in which the applicant engaged

for the five years preceding the date of application; and

(6) other relevant information the commissioner requires.

(b) The application must be accompanied by an investigation and

annual fee of $25.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.104. APPROVAL OR DENIAL OF APPLICATION. (a) Not later

than the 60th day after the date an application is filed, the

commissioner shall determine whether the applicant qualifies for

a pawnshop employee license.

(b) The commissioner shall approve the application and issue a

license if the commissioner finds that the applicant qualifies

for a license.

(c) If the commissioner does not make the finding required by

Subsection (b), the commissioner in writing shall notify the

applicant and the employing pawnbroker that the application will

be denied unless the applicant, in writing and not later than the

30th day after the date of the notice, requests a hearing on the

application.

(d) An application is denied on the 31st day after the date of

the notice if the applicant does not request a hearing in the

time allowed.

(e) If an applicant requests a hearing in the time allowed, the

commissioner shall conduct a hearing on the application. On the

conclusion of the hearing, the commissioner shall approve or deny

the application.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.105. LICENSE TERM. A pawnshop employee license is

effective until the license expires or is surrendered, suspended,

or revoked.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.106. ANNUAL LICENSE FEE; EXPIRATION. (a) Not later

than December 1, a pawnshop employee license holder shall pay to

the commissioner an annual fee of $15 for the year beginning the

next January 1.

(b) The commissioner shall send written notice of delinquency to

a license holder who does not pay the fee on or before December

1.

(c) If the annual fee for a license is not paid before the 16th

day after the date of the delinquency notice, the license expires

on the later of:

(1) that day; or

(2) January 1 of the first year for which the annual fee was not

paid.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 1399, Sec. 6, eff. Sept. 1,

1999.

SUBCHAPTER D. OPERATION OF PAWNSHOPS

Sec. 371.151. HOURS OF OPERATION. (a) A pawnbroker shall

maintain normal business hours of at least four hours a day for

five days a week.

(b) A pawnbroker may not do business before 7 a.m. or after 9

p.m.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.152. RECORDKEEPING. (a) A pawnbroker, consistent with

accepted accounting practices, shall keep adequate books and

records relating to the pawnbroker's pawn transactions and any

other business regulated by this chapter.

(b) Books and records shall be preserved at least until the

second anniversary of the date of the last transaction recorded.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.153. NOTICE OF OPERATION OF OTHER BUSINESS. (a) A

pawnbroker shall notify the commissioner before the pawnbroker

allows another person to conduct at the pawnshop a business other

than the business of a pawnbroker or the business of buying and

selling goods.

(b) The commissioner may refuse to permit a person other than

the pawnbroker to operate the other business on the pawnshop

premises if the commissioner finds that the operation is

inconsistent with this chapter.

(c) A pawnbroker shall notify the commissioner of any location

at which the pawnbroker or an applicant for a pawnshop license

operates a buy shop, secondhand merchandise store, retail outlet,

or similar business or any business to which the pawnbroker

regularly transfers goods from the pawnshop.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 5, eff. Sept. 1,

1999.

Sec. 371.154. INSURANCE AND BOND. (a) A pawnbroker shall

maintain general liability and fire insurance:

(1) in a reasonable amount and form required by the

commissioner; and

(2) sufficient to protect pledged goods, including jewelry, at

the pawnshop.

(b) A pawnbroker shall secure a bond:

(1) in the amount, not to exceed $5,000, required by the

commissioner;

(2) in the form required by the commissioner; and

(3) conditioned on compliance with this chapter and rules

adopted under this chapter.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 6, eff. Sept. 1,

1999.

Sec. 371.155. PAWNSHOP SECURITY. A pawnshop shall have:

(1) one or more alarm systems sufficient to detect and signal

unauthorized entry or the presence of an unauthorized person to

provide for the security of pledged goods; and

(2) a safe to provide for the security of pledged jewelry.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 7, eff. Sept. 1,

1999.

Sec. 371.156. PAWN TRANSACTION. (a) Items that are usually

sold as a set are considered a single item and must be included

in the same pawn transaction.

(b) A pledged item together with items that are accessories to

the pledged item are considered a single item and must be

included in the same pawn transaction.

(c) A separate pawn transaction retains its separate character

when it is renewed, unless the parties agree otherwise.

(d) A pawnbroker may not divide a pawn transaction into more

than one transaction to obtain, or with the effect of obtaining,

a total pawn service charge that exceeds the charge authorized

for an amount financed that is equal to the total of the amounts

financed in the resulting transactions.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.157. PAWN TICKET. A pawnbroker, at the time a pawn

transaction is entered, shall deliver to the pledgor a pawn

ticket or other memorandum that clearly shows:

(1) the name and address of the pawnshop;

(2) the pledgor's name, address, and physical description and a

driver's license number, military identification number,

identification certificate number, or other official number that

can identify the pledgor;

(3) the date of the transaction;

(4) an identification and description of the pledged goods,

including serial numbers if reasonably available;

(5) the amount of cash advanced or credit extended to the

pledgor, designated as "Amount Financed";

(6) the amount of the pawn service charge, designated as

"Finance Charge";

(7) the total amount, consisting of the amount financed plus the

finance charge, that must be paid to redeem the pledged goods on

the maturity date, designated as "Total of Payments";

(8) the "Annual Percentage Rate," computed according to

regulations issued by the Federal Reserve Board under the Truth

in Lending Act (15 U.S.C. Section 1601 et seq.), as amended;

(9) the maturity date of the pawn transaction; and

(10) a statement that:

(A) the pledgor is not obligated to redeem the pledged goods;

and

(B) the pledged goods may be forfeited to the pawnbroker on the

31st day after the maturity date.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 2003, 78th Leg., ch. 1199, Sec. 1, eff. Sept. 1,

2003.

Sec. 371.158. AMOUNT FINANCED. The amount financed by a pawn

transaction may not exceed the amount computed under Subchapter

C, Chapter 341, using the reference amount of $2,500.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.159. PAWN SERVICE CHARGE. (a) A pawnbroker may not

contract for, charge, or receive an amount, other than a pawn

service charge, as a charge for credit in connection with a pawn

transaction.

(b) A pawn service charge may not exceed the charge disclosed in

the pawn ticket or other memorandum delivered to the pledgor.

(c) A pawn service charge may not exceed an amount equal to:

(1) 20 percent of the total amount financed for one month if

that amount is less than or equal to the amount computed under

Subchapter C, Chapter 341, using the reference amount of $30;

(2) 15 percent of the total amount financed for one month if

that amount is more than the amount computed for Subdivision (1)

but less than or equal to the amount computed under Subchapter C,

Chapter 341, using the reference amount of $200;

(3) 2-1/2 percent of the total amount financed for one month if

that amount is more than the amount computed for Subdivision (2)

but less than or equal to the amount computed under Subchapter C,

Chapter 341, using the reference amount of $300; or

(4) 1 percent of the total amount financed for one month if that

amount is more than the amount computed for Subdivision (3).

(d) A rate set by Subsection (c) shall be proportionately

adjusted for a finance period of less than one month.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 2001, 77th Leg., ch. 1235, Sec. 22, eff. Sept. 1,

2001.

Sec. 371.160. MATURITY DATE; MEMORANDUM OF EXTENSION. (a) A

pawnbroker may not enter a pawn transaction that has a maturity

date later than one month after the date of the transaction.

(b) The pledgor and the pawnbroker by written agreement may

change the maturity date of a pawn transaction to a subsequent

date.

(c) The written agreement must clearly set out:

(1) the new redemption date; and

(2) the amount of any additional pawn service charge.

(d) The pawnbroker must provide a copy of the written agreement

to the pledgor.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.161. EARLY REDEMPTION: REDUCTION OF PAWN SERVICE

CHARGE. If a pledgor redeems the pledged goods before the

maturity date of the pawn transaction, any part of the pawn

service charge that exceeds $15 shall be reduced by an amount

equal to one-thirtieth of the total pawn service charge for each

day between the date on which redemption occurs and the original

maturity date.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.162. PRESENTATION OF TICKET; PRESUMPTION. Except as

provided by Section 371.163(a), a person who presents proper

identification and a pawn ticket to the pawnbroker is presumed to

be entitled to redeem the pledged goods described by the pawn

ticket.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 8, eff. Sept. 1,

1999.

Sec. 371.163. LOST OR DESTROYED TICKET. (a) If a pawn ticket

is lost, destroyed, or stolen, the pledgor may notify the

pawnbroker of that fact in writing. Receipt of this notice

invalidates the pawn ticket if the pledged goods have not been

redeemed.

(b) The pawnbroker shall require the pledgor to make a written

statement of the loss, destruction, or theft before the

pawnbroker delivers the pledged goods or issues a new pawn

ticket.

(c) The pawnbroker shall record on the written statement:

(1) the date the statement is made; and

(2) the number of the pawn ticket lost, destroyed, or stolen.

(d) The statement must be signed by the pawnbroker or the

pawnshop employee who accepts the statement from the pledgor.

(e) A pawnbroker is entitled to a fee of not more than $1 in

connection with the accepting of a written statement under this

section.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 9, eff. Sept. 1,

1999.

Sec. 371.164. DUTY OF REASONABLE CARE. A pawnbroker shall

exercise reasonable care to protect pledged goods from loss or

damage.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.165. RETURN OF PLEDGED GOODS. A pawnbroker shall

return pledged goods to the pledgor on payment of the total

amount due the pawnbroker in connection with the pawn

transaction.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.166. REDEMPTION BY MAIL. A pawnbroker shall permit a

pledgor to redeem pledged goods by mail.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.167. LOST OR DAMAGED GOODS. (a) A pawnbroker shall

replace pledged goods that are lost or damaged while in the

pawnbroker's possession with like kind merchandise. The

replacement is subject to approval by the commissioner and the

pledgor must exhaust this administrative remedy with respect to

the lost or damaged pledged goods before seeking a remedy in

court. If the commissioner does not approve a replacement before

the 91st day after the date on which the commissioner receives a

complaint from the pledgor concerning the lost or damaged goods,

or if the pledgor does not accept the commissioner's

determination, the pledgor may seek a remedy in court.

(b) For purposes of this section, goods are considered lost if

the goods are destroyed or have disappeared and are unavailable

for return to the pledgor.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 1399, Sec. 7, eff. Sept. 1,

1999.

Sec. 371.168. EXEMPTION FROM CRIMINAL LIABILITY. A pawnbroker

is not criminally liable for damages or loss due to an act of God

or circumstances beyond the pawnbroker's control.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.169. UNREDEEMED PLEDGED GOODS; FORFEITURE. (a) A

pawnbroker shall hold pledged goods not redeemed by the pledgor

on or before the maturity date stated in the pawn ticket issued

in connection with a pawn transaction for at least 30 days after

that date.

(b) On or before the 30th day after the original maturity date,

the pledgor may redeem the pledged goods by paying:

(1) the originally agreed redemption price; and

(2) an additional pawn service charge equal to one-thirtieth of

the original monthly pawn service charge for each day after the

original maturity date, including the day on which the pledged

goods are finally redeemed.

(c) Pledged goods not redeemed on or before the 30th day after

the original maturity date may, at the option of the pawnbroker,

be forfeited to the pawnbroker.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 2001, 77th Leg., ch. 1235, Sec. 23, eff. Sept. 1,

2001.

Sec. 371.170. REDEMPTION OR PAYMENT BY PLEDGOR NOT REQUIRED. A

pledgor is not obligated to redeem pledged goods or to make a

payment on a pawn transaction.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.171. AGREEMENT REQUIRING PLEDGOR'S PERSONAL LIABILITY

PROHIBITED. A pawnbroker may not enter an agreement requiring

the personal liability of the pledgor in connection with a pawn

transaction.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.172. WAIVER OF PLEDGOR'S RIGHTS PROHIBITED. A

pawnbroker may not accept a waiver of a right or protection of a

pledgor under this chapter.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.173. INSURANCE CHARGE LIMITED. A pawnbroker may not

impose a charge for insurance in connection with a pawn

transaction, except that a pawnbroker may impose a charge in the

amount of the actual cost to insure pledged goods being shipped

to a pledgor who redeemed the goods by mail.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.174. IDENTIFICATION OF PLEDGOR OR SELLER REQUIRED. (a)

A pawnbroker shall require identification of:

(1) the pledgor if a transaction is a pawn transaction; or

(2) the seller if a transaction is a purchase of goods by the

pawnbroker.

(b) Identification is acceptable only if it contains a

photograph of the pledgor or seller and is:

(1) a state driver's license;

(2) a state identification card;

(3) a passport;

(4) a military identification;

(5) a certificate of identification from the Mexican Consulate,

certificado de matricula consular; or

(6) identification issued by the agency of the United States

responsible for citizenship and immigration.

(c) A pawnbroker shall make the pawnbroker's best effort to

determine whether the identification:

(1) is apparently genuine and unaltered; and

(2) properly identifies the pledgor or seller.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 2003, 78th Leg., ch. 1199, Sec. 2, eff. Sept. 1,

2003.

Sec. 371.175. PROPERTY IDENTIFICATION TAGS REQUIRED. (a) A

pawnshop shall identify by a tag or similar means each item of

goods located in the pawnshop that:

(1) has a retail or sale value of more than $25; and

(2) can be tagged or similarly identified.

(b) This section does not apply to:

(1) the personal effects of a person in the pawnshop; or

(2) furniture, fixtures, or equipment of the pawnshop.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 10, eff. Sept. 1,

1999.

Sec. 371.176. TRANSACTIONS WITH MINORS OR PERSONS UNDER THE

INFLUENCE OF ALCOHOL OR DRUGS PROHIBITED. A pawnbroker may not:

(1) accept a pledge or purchase property from a person under 18

years of age; or

(2) transact business with a person believed to be under the

influence of alcohol or drugs.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 11, eff. Sept. 1,

1999.

Sec. 371.177. PURCHASE OF USED PERSONAL PROPERTY. A pawnbroker

may not purchase used personal property from a person other than

another pawnbroker unless a record is established that contains:

(1) the seller's name, address, and physical description and a

driver's license number, military identification number,

identification certificate number, or other official number that

can identify the seller;

(2) a complete description of the property, including the serial

number, if reasonably available, or other identifying

characteristics; and

(3) the seller's signed statement that the seller has the right

to sell the property.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.178. ACCEPTANCE OF BUILDING CONSTRUCTION MATERIALS.

(a) A pawnbroker may not accept the pledge of building

construction materials unless a record is established that

contains the information required by Section 371.177.

(b) In this section, "building construction materials" includes:

(1) copper pipe, tubing, or wiring;

(2) aluminum wire;

(3) plumbing supplies;

(4) electrical supplies;

(5) window glass;

(6) lumber; and

(7) other similar materials.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.179. DISPLAYS OF CERTAIN WEAPONS PROHIBITED. A

pawnbroker may not display for sale in a storefront window or

sidewalk display case or depict on a sign or advertisement in

such a way that the item, sign, or advertisement may be viewed

from a street:

(1) a pistol;

(2) a dirk;

(3) a dagger;

(4) a blackjack;

(5) a hand chain;

(6) a sword cane;

(7) knuckles made of metal or any other hard substance; or

(8) a switchblade, springblade, or throwblade knife.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.180. ADVERTISEMENTS. (a) A person who does not hold a

pawnshop license may not:

(1) advertise or cause to be advertised the making, arranging,

or negotiating of a loan subject to this chapter; or

(2) use in an advertisement a word, symbol, or statement that

states or suggests that the person is a pawnbroker.

(b) In each advertisement that purports to offer credit subject

to this chapter, the advertiser shall disclose the legal or

registered name of the advertiser and the physical address of the

advertiser's place of business. This subsection does not apply to

an advertisement located on the premises of the advertiser's

place of business.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.181. STOLEN GOODS. (a) A pawnbroker shall monitor

goods purchased, accepted in pawn, or otherwise acquired by the

pawnbroker in order to identify and prohibit transactions

involving stolen goods.

(b) The Finance Commission of Texas shall adopt rules that

allow:

(1) a consumer who has filed an offense report with a local law

enforcement agency to request that a pawnbroker search the

records of the pawnshop; and

(2) the pawnbroker to assist the consumer and the local law

enforcement agency in locating and recovering stolen property.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 2001, 77th Leg., ch. 867, Sec. 101, eff. Sept. 1,

2001.

Sec. 371.182. HOLD PERIOD. The commissioner may designate a

reasonable hold period during which a pawnbroker may not sell or

otherwise dispose of an item of goods acquired and offered for

sale or other disposition by the pawnbroker.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 12, eff. Sept. 1,

1999.

Sec. 371.183. CONSUMER INFORMATION. The Finance Commission of

Texas by rule may require a pawnshop to display, in an area in

the pawnshop accessible to a consumer, materials provided by the

commissioner that are designed to:

(1) inform a consumer of the duties, rights, and

responsibilities of parties to a transaction regulated by the

commissioner; and

(2) inform and assist a robbery, burglary, or theft victim.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 2001, 77th Leg., ch. 867, Sec. 102, eff. Sept. 1,

2001.

SUBCHAPTER E. INSPECTIONS AND EXAMINATIONS

Sec. 371.201. EXAMINATION BY COMMISSIONER. At any time the

commissioner considers necessary, the commissioner or the

commissioner's representative may:

(1) examine a pawnbroker's place of business;

(2) inquire into and examine a pawnbroker's transactions, books,

accounts, papers, correspondence, or other records that relate to

the business of the pawnbroker; and

(3) examine or inspect pledged goods and goods required to be

identified by Section 371.177.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.202. ACCESS TO RECORDS; COPIES. (a) During an

examination the pawnbroker shall give the commissioner or the

commissioner's representative free access to the pawnbroker's

office, place of business, files, safe, or vault.

(b) The commissioner or the representative is entitled to copy

any book, account, paper, correspondence, or other record that

relates to the business of the pawnbroker.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.203. OATHS. During an examination the commissioner or

the commissioner's representative may administer an oath and

examine a person under oath on a subject relating to a matter

regarding which the commissioner is authorized or required by

this chapter to consider, investigate, or secure information.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.204. INSPECTION BY PEACE OFFICER. A pawnbroker shall

allow a peace officer to inspect the pawnbroker's books,

accounts, papers, correspondence, or other records that relate to

the business of the pawnbroker at any reasonable time without

judicial writ or other process.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.205. REFUSAL TO ALLOW EXAMINATION OR INSPECTION. A

pawnbroker who fails or refuses to permit an examination or

copying of books or other documents or an examination or

inspection of goods authorized by this subchapter violates this

chapter. The failure or refusal is grounds for the suspension or

revocation of the license.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.206. CONFIDENTIALITY. Information obtained during an

examination or inspection authorized by this subchapter is

confidential and privileged except for use by the commissioner or

in a criminal investigation or prosecution.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.207. FEE. A pawnbroker shall pay to the commissioner

an amount assessed by the commissioner to cover the direct and

indirect costs of an examination and a proportionate share of

general administrative expenses.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.208. VERIFICATION OF NET ASSETS. If the commissioner

questions the amount of a pawnbroker's net assets, the

commissioner may require certification by an independent

certified public accountant that:

(1) the accountant has reviewed the pawnbroker's books, other

records, and transactions during the reporting year;

(2) the books and other records are maintained using generally

accepted accounting principles; and

(3) the pawnbroker meets the net assets requirement of Section

371.072.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

SUBCHAPTER F. LICENSE REVOCATION, SUSPENSION, AND SURRENDER

Sec. 371.251. REVOCATION OR SUSPENSION OF PAWNSHOP LICENSE. (a)

After notice and hearing, the commissioner may revoke or suspend

a pawnshop license if the commissioner finds that:

(1) the pawnbroker has not paid a fee or charge imposed by the

commissioner under this chapter;

(2) the pawnbroker, knowingly or without exercising due care to

prevent the violation, has violated this chapter or a rule

adopted or an order issued under this chapter;

(3) a fact or condition exists that, if it had existed or had

been known to exist at the time of the original license

application, clearly would have justified refusal to issue the

license;

(4) the pawnbroker has established an association with an

unlicensed person who, with the knowledge of the pawnbroker, has

violated this chapter;

(5) the pawnbroker has aided or conspired with a person to

circumvent this chapter;

(6) the pawnbroker or a legal or beneficial owner of the

pawnbroker is not of good moral character or has been convicted

of a crime that the commissioner finds directly relates to the

duties and responsibilities of the occupation of pawnbroker or

would otherwise make the person unfit for a pawnshop license

under Section 371.052;

(7) the financial responsibility, experience, character, or

general fitness of the pawnbroker or its owners and managers do

not command the confidence of the public or warrant the belief

that the business will be operated lawfully, fairly, and within

the purposes of this chapter; or

(8) the pawnbroker has not maintained the minimum net assets

required by Section 371.072.

(b) The commissioner may:

(1) place on probation a person whose license is suspended; or

(2) reprimand a pawnbroker for violating this chapter or a rule

adopted under this chapter.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.252. EFFECT OF REVOCATION, SUSPENSION, OR SURRENDER OF

PAWNSHOP LICENSE. Revocation, suspension, or surrender of a

pawnshop license does not affect a preexisting contract between

the pawnbroker and a pledgor.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.253. NOTICE OF REVOCATION. (a) On revocation of a

pawnshop license by the commissioner, the pawnbroker shall send

notice of the revocation to each pledgor with goods in the

possession of, but not forfeited to, the pawnbroker on the

revocation date.

(b) The notice must be:

(1) in a form prescribed by the commissioner; and

(2) mailed not later than the fifth day after the revocation

date to the pledgor at the address recorded on the pawn ticket.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.254. REDEMPTION OF GOODS AFTER LICENSE REVOCATION OR

SUSPENSION. (a) After revocation of a pawnshop license, the

pawnbroker, for the sole purpose of allowing a pledgor to redeem

pledged goods, shall maintain usual business hours at the

pawnshop for 60 days after the latest maturity date of any pawn

transaction made at that pawnshop.

(b) If after the revocation of a license and within the period

provided by Section 371.169 a pledgor requests an extension of

that period, the pawnbroker shall grant an extension not to

exceed 30 days.

(c) The commissioner may exercise any authority conferred on the

commissioner to protect the interest of a pledgor of goods in the

possession of a pawnbroker whose license has been revoked,

including assessment of a penalty or administrative enforcement

under this chapter.

(d) On suspension of a pawnshop license by the commissioner, the

pawnbroker shall maintain the pawnshop's usual business hours

during the suspension for the sole purpose of allowing a pledgor

to redeem goods or to renew a pawn transaction that matures

during the suspension.

(e) A pawnbroker shall renew a pawn transaction that matures

during a suspension if, not later than the 60th day after the

maturity date, the pledgor requests a renewal.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.255. REVOCATION OR SUSPENSION OF PAWNSHOP EMPLOYEE

LICENSE. After notice and hearing, the commissioner may revoke

or suspend a pawnshop employee license if the commissioner finds

that:

(1) the license holder knowingly or recklessly violated this

chapter or a rule adopted or order issued under this chapter;

(2) a fact or condition exists that, if it had existed or had

been known to exist at the time of the original license

application, clearly would have justified refusal to issue the

license; or

(3) the moral character, business repute, and general fitness of

the license holder do not warrant belief that the license holder

will operate the business lawfully and fairly within the

provisions of this chapter.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.256. HEARING. (a) The commissioner shall send written

notice of a pawnshop employee license revocation or suspension

hearing to:

(1) the license holder; and

(2) the employing pawnbroker.

(b) The commissioner shall hold the hearing not earlier than the

21st day after the date the notice was sent.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.257. SURRENDER OF LICENSE. (a) The holder of a

pawnshop license or a pawnshop employee license may surrender the

license by delivering it to the commissioner with written notice

of surrender.

(b) Surrender does not affect a license holder's civil or

criminal liability for an act committed before the surrender.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.258. REINSTATEMENT OF LICENSE. (a) This section

applies to a pawnshop license or a pawnshop employee license.

(b) The commissioner may reinstate a suspended pawnshop license

or pawnshop employee license or issue a new license to the person

whose license or licenses have been revoked if no fact or

condition exists that clearly would have justified refusal to

issue the license originally.

(c) The commissioner shall reinstate an expired pawnbroker

license if, not later than the 180th day after the date on which

the license expired, the pawnbroker pays the commissioner the

delinquent $125 annual fee plus a reinstatement fee of $1,000.

After a pawnbroker's license has expired, the commissioner shall

promptly send notice of reinstatement rights to the delinquent

pawnbroker by certified mail.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by Acts 1999, 76th Leg., ch. 801, Sec. 13, eff. Sept. 1,

1999; Acts 1999, 76th Leg., ch. 1399, Sec. 8, eff. Sept. 1, 1999.

Sec. 371.259. CERTIFICATE OF STANDING; COPIES. The

commissioner, under the commissioner's seal and signature, shall

provide a certificate of good standing or a certified copy of a

pawnshop license or a pawnshop employee license to a person who

applies and pays for the certificate or copy.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

SUBCHAPTER G. ENFORCEMENT; PENALTIES

Sec. 371.301. COMMISSIONER'S ENFORCEMENT POWERS. For purposes

of enforcing this chapter, the commissioner:

(1) has the powers granted to the commissioner under Chapter 14;

(2) may exercise those powers in the same manner as those powers

may be exercised under:

(A) Chapters 14, 392, and 394;

(B) Subtitle B, Title 4; and

(C) Chapters 51, 302, 601, and 621, Business & Commerce

Code; and

(3) has any authority granted the commissioner by other law.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.19, eff. April 1, 2009.

Sec. 371.302. ORDER TO END VIOLATION; INJUNCTION; DAMAGES. (a)

If the commissioner has reasonable cause to believe that a person

is violating this chapter, the commissioner, in addition to and

without prejudice to other authority provided by this chapter,

may enter an order requiring the person to stop or to refrain

from the violation.

(b) At the commissioner's request, the attorney general or an

attorney authorized to represent this state in district court

shall sue in any district court with venue or in a district court

of Travis County to enjoin a person from violating or continuing

a violation of this chapter or from acting to further a

violation. The court may enter an order or judgment awarding a

preliminary or permanent injunction. The court may issue an

additional order or judgment for actual damages suffered by a

person as a result of the violation.

Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.

Sec. 371.303. ADMINISTRATIVE PENALTY. (a) The commissioner may

assess an administrative penalty against a person who violates

this chapter or a rule adopted under this chapter.

(b) The commissioner may assess the administrative penalty in an

amount not to exceed $1,000.

(c) Each day a violation continues or occurs may be considered a

separate violation for purposes of this section. The aggregate

amount of penalties that may be assessed under this section

against a person during one calendar year may not exceed $10,000

for violations an element of which occurred at the same business

location.

(d) In determining the amount of a penalty, the commissioner

shall consider:

(1) the seriousness of the violation, including the nature,

circumstances, extent, and gravity of the prohibited act;

(2) the history of previous violations;

(3) the amount necessary to deter future violations;

(4) efforts to correct the violation; and

(5) any other matter that justice may require.

(e) If, after investigation of a possible violation and the

facts relating to that possible violation, the commissioner

determines that a violation has occurred, the commissioner shall

issue a preliminary report that states:

(1) the facts on which the conclusion is based;

(2) the fact that an administrative penalty is to be imposed;

and

(3) the amount to be assessed.

(f) Not later than the 10th day after the date on which the

commissioner issues the preliminary report, the commissioner

shall send to the person charged with the violation a copy of the

report and a statement that the person has a right to a hearing

on the alleged violation and the amount of the penalty.

(g) Not later than the 2