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December 10, 2009
Internet and other transactions of secondhand precious metal
objects /pawn that are not conducted in-person
This advisory concerns acquisitions of secondhand precious metal objects and items in pawn
transactions through the mail as a result of dealer solicitations through the internet, television,
radio, print advertisements or other mean.. The Department of Labor, Licensing and Regulation
("Department") wants to remind licensed dealers of the reporting and recordkeeping requirements
of Title 12 - 2-302 (a)(4) Business Regulation Article, Annotated Code of Maryland, which states:
"Title 12-302 (a)(4)
(4) for each individual from whom the dealer acquires a precious metal object:
(i) the name, date of birth, and driver's license number
of the individual; or
(ii) identification information about the individual that:
1. positively identifies the individual from at least 2 forms of identification, which may include
an age of majority card, military identification, or passport; and
2. provides a physical description of the individual, including the sex, race, any distinguishing
features, and approximate age, height, and weight of the individual;
(5) a statement indicating whether or not the person making the transaction is
personally known to the dealer; and
(6) the signature of the person from whom the precious metal object or personal
property is acquired and the dealer or employee who accepted the precious metal object.
The Department interprets this provision to require face-to-face, in-person, transactions between
sellers of secondhand precious metal objects/items in pawn transactions and dealers. The Department
finds that a licensed dealer cannot fully comply with the requirements of law, including but not
limited to the obligation to personally verify the seller's identity. Transactions that involve
the delivery to the dealer of secondhand precious metal objects by the U.S. Postal Service,
private delivery companies, or other means can not be properly reported on the daily transaction
report. A dealer is required to positively verify that the individual selling an item is actually
the person that say they are. The dealer may only do this by an in-person comparison of the seller
with the acceptable forms of identification specified by law or the Department.
Please be advised that effective, immediately, daily transaction reports of items that a dealer
acquires other than through an in-person transaction may be deemed improper and may provide the
basis for regulatory action for which a disciplinary sanction can result. Such sanctions can
include the suspension or revocation of the dealer's license, a civil penalty of up to $5,000
per violation or combination thereof.
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