We Dodged a Bullet....for now.....

Posted on November 11, 2012 by John Fritze Jr

Albany County legislators recently tried to pass a ruling dubbed “The Pawn Law” whose purpose was to curb crime and the sale of stolen jewelry items to businesses that purchase gold. The law written by Gary Domalewicz is simply another example of how our legislators believe they are part of some elitist society whose job it is to protect us from ourselves. While it is politically incorrect to say this was a poorly conceived idea which would serve no purpose, it is obvious to me, Mr. Domalewicz clearly has no idea of how business works.

Foremost, it is important to correct the term “Pawn Law” and note that there are no pawn shops in Albany. The term “pawn” means that someone will loan you some money based on the value of an item you have. Your obligation is to pay back the loan with interest within a certain time limit; otherwise the pawn shop can sell your item to recoup expenses. While other areas nationwide have these types of businesses, it was made illegal many years ago in the city of Albany. This law is really aimed at “secondhand dealers” and has nothing to do with pawning.

It behooves me to note that the original version Domalewicz proposed would have required a $50,000 bond be posted by dealers in second hand gold and silver, and no requirement for police to provide reports of stolen jewelry. That original version if passed would have been a travesty. What was to stop a police officer from entering a store, insisting on looking through inventory, pulling out a particular piece or three, declaring it stolen and walking out with the items? Was the item really stolen or was it a “shopping” trip for their spouse? We are all painfully aware that a small number of officers seem to gain notoriety for unprofessional behavior. Just look at the news.

As dealers we were supposed to believe that the second slightly watered down version was the “best we can expect”. Thankfully Dan McCoy was clear headed enough to give it the veto it deserved. As our county legislators regroup for yet a third try at passing the same law. I hope McCoy yet again, does the right thing.

The Times Union editorial of October 16th says that pawnshops would be required to register with the county and post a $5000 bond. Unfortunately that is only partially true. Every antique dealer, jeweler, coin and stamp dealer, auctioneer, precious metal recycler, consignment store and church thrift shop would be required to post a bond. There are several businesses whose job is to help seniors organize, downsize and raise monies by selling off years of collectibles. The proposed law makes no distinction between all these businesses which ultimately perform similar services. I doubt most of these small businesses, mostly sole proprietorships were even aware this law would affect them.

The amount of monies put aside for these bonds would staggering. Just what is this bond money supposed to accomplish anyway? There are already laws in place regarding the sale and purchase of stolen goods. Here’s a shocker: unscrupulous people really do not care about laws.

The law required that those purchasing precious metals from the public provide name, telephone number, address and item descriptions to the police. Most people finding it necessary to sell grandma’s diamond engagement ring are embarrassed that they need money in this poor economy to pay their bills and really wish nothing more than privacy.

Another poorly thought out problem with this law is that the honest person will ultimately be the loser. Since only sales over $250 require detailed documentation, if someone enters a shop trying to sell say, $300 or $350 of gold, what do you think that person will be offered? While it may result in a slightly lower amount paid to one person, multiply that by hundreds of customers by many, many dealers. Apparently this scenario did not occur to Gary Domalewicz.

Perhaps this is all a moot point, and most of the fore mentioned businesses will simply decide to not to continue to purchase scrap jewelry from the public. That will leave one or two major buyers in Albany County therefore alleviating any competition. This is a bad precedent too, Mr. Domalewicz.

Doing a little research, I found that in 1978 through 1980 (the last time gold and silver were at similar market prices) home burglaries in New York State ranged from 292,956 to 360,925 while remarkably burglaries in 2009 and 2010 were 62,769 and 64,973 respectively. That is 80% lower than 25 years ago. These numbers can be found at: www.disastercenter.com/crime/. What is this law is designed to accomplish?

In my business, it is common for a customer to have inherited an item they wish to have refashioned into something more modern, selling some left over gold to offset the labor and parts for the new item. Does this mean I need to turn over to the police all of my customer’s personal contact information, descriptions of the starting and ending pieces of jewelry and the amount of monies paid? Or perhaps I am supposed to wait weeks before I can start a repair to see if the item is stolen. This is just not practical as the metals market fluctuations determine not only my cost but what I need to charge my clients.

I have been in the jewelry manufacturing and repair business for more than forty years. My family has been in the jewelry business in the capital district since the very early 1900s. My grandfather was jeweler to the King of Denmark. The jewelry trade used to be considered a respectable business with respectable members of the community. Domalewicz apparently believes it is acceptable to place the blame for burglaries on a particular segment of our business community.

In a recent letter to the Time Union, Domalewicz contradicts his own argument for the “Pawn Law”. He states that speculation that burglars would travel outside the bounds of this law to sell their goods would “give them too much credit” and yet earlier in the very same paragraph he states the very reason for passing this law is because the burglars are doing that very thing.

Remember one thing Mr. Domalewicz: you are an elected official.