National Pawnbroker Fall 2012

Official publication of the National Pawnbrokers Association

FALL 2012

Making Music and Smiles page 16

Compliance Boot Camp 2012 Page 20

Final Offer Behind the Scenes Page 28

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MESSAGE FROM THE PRESIDENT

Your Membership Counts AND YOUR PARTICIPATION KEEPS US STRONG

YOUR MEMBERSHIP DUES ARE AN important part of the resources that allow NPA to represent our industry.

But there is more to membership than just writing a check.

BOARD AND COMMITTEES

All year, a dedicated group of individuals works to manage the direction of NPA. From making sure the association is financially secure, to watching out for the industry on the legislative front, NPA board and committee members are the eyes, ears, and hard-working hands of the association.

We need members to become involved at the leadership level. Contact Dana Meinecke at the association office, or dana@nationalpawnbrokers.org, for more information on how you can contribute.

LEGISLATIVE CONFERENCE

Each year, NPA holds its Legislative Conference in Washington, DC. Your participation in this conference is vital to the success of our industry.

The conference will e held pril , .

Contact Matthew Church, Government Relations Administrator, at matthew@NationalPawnbrokers.org or call him at for more information.

COMMUNITY SERVICE

Each of you knows how important our industry is to local communities. With that in mind, NPA gives you two opportunities to show your community support.

The Future Business Leaders Scholarship Fund (FBL) is the NPA members’ philanthropic contribution to your local community. Each year, students from across the country submit applications for the opportunity to earn a scholarship for higher education. The application is located on the NPA website if you have a student interested in applying. The deadline is pril , .

So far this year, members have contributed over , towards this scholarship fund. Thank you

MUSICAL INSTRUMENT GIFT DAY DECEMBER 6, 2012

To many, music has fallen out of favor as an educational tool at a time when it is needed more than ever. n ecem er , , the will sponsor its fourth annual Musical Instrument Gift Day, where pawnbrokers from around the country make generous donations of musical instruments to organizations in need.

This year, NPA is working closely with The r. olland s pus oundation, a non profit organization that donates both new and quality refurbished instruments to under-funded music programs that lack the resources to keep up with equipment loss, and accommodates students on waiting lists or who have to share instruments.

Imagine the joy of a child who has their own instrument to play. It lets them know that we value them and their contribution to the world. ee the article on page of this issue of National Pawnbroker magazine for more information on how to participate in Musical Instrument Gift Day.

Kevin Prochaska NPA President

STAYING INFORMED

NPA can give you all of the information in the world, but if you don’t read it and digest it, you won’t be able to use it to better your business.

This issue of National Pawnbroker magazine is our ompliance ssue. n it you will find articles with updates that will help you stay out of hot water. Wasting time and money on things you aren’t aware of hurts your business. Take time to stay informed.

I want to wish each of you a happy holiday season. You’ll be busy, but take time to remember all of the things you have to be thankful for. I’m looking forward to ser ing you in the new year

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Table of Contents

FALL 2012

FEATURE ARTICLES Gift Day

16

Compliance Boot Camp 2012

20

Final Offer: Behind the Scenes

28

16

20

IN THIS ISSUE Letter from the President Letter From the Executive Director Government Relations Legislative Update Legislative Conference Federal Charter Wake Up Call Compliance Compliance Boot Camp 2012 Weighing in on Scale Selection FFL Notice NICS News Community Involvement Gift Day 2012 FBL and C.O.P.S. Awards Official publication of the National Pawnbrokers Association

FALL 2012

Making Music and Smiles page 16

Compliance Boot Camp 2012 Page 20

COVER STORY

6 10 30 20 24 44 56 16 38

Give the gift of music to a school in need. Celebrate NPA Musical Instrument Gift Day, December 6, 2012.

Final Offer Behind the Scenes Page 28

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Member News Vendor Spotlight Become a NPA Board Member New Members Membership Renewals The Discovery Channel’s Final Offer State Association Contacts State News Chinese Delegation Visits EZ Pawn Human Resources: The Most Difficult Job Business Sense Eight Things Every Seller Should Know Holiday PRESSure Mobile Banking and You Data = Trade Secrets Special Events SHOT Show Stuller Bridge Event Calendar of Events NPA Staff Index of Advertisers

8 12 & 14 13 18 28 48 49 52 22 27 42 47 54 33 41 67 67 68

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National Pawnbroker is the official publication of the National Pawnbrokers Association (NPA), and is published quarterly. No part of this publication may be reproduced without the written consent of Dana Meinecke, NPA Executive Director. Sale or distribution of any or all of the contents of this magazine is prohibited. All rights reserved. For more information on advertising or to obtain additional copies of National Pawnbroker, call 817-337-8830 or send an email to chris@nationalpawnbrokers.org. For membership information, email margie@nationalpawnbrokers.org. EDITOR’S NOTE: This publication is designed to provide accurate and authoritative information on the subject matter covered. It is provided and disseminated with the understanding that the publisher is not engaged in rendering legal or other professional services. If legal advice is required, the services of a competent professional should be sought. © 2007-12 National Pawnbrokers Association: P.O. Box 508, Keller, TX 76244 • 817-337-8830 • www.nationalpawnbrokers.org EDITOR: Chris Pearcey, NPA Communications Specialist, chris@nationalpawnbrokers.org; DESIGNERS: Liza Samala and Carla L. Butz

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E X I T S T R AT E GY C O N SU LT IN G

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Steve Stallcup

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LETTER FROM THE EXECUTIVE DIRECTOR

Winding Down 2012 AND WINDING UP FOR 2013

PAWN EXPO 2013

AS THIS YEAR WINDS TO A CLOSE, THE NPA staff has already started on 2013’s projects.

Pawn Expo 2013 will be held July 16-18 at the Cosmopolitan of Las Vegas once again. Lindsay Wilson, NPA Director of Meetings and Events, has already sold the majority of the booths in the trade show. We are hard at work on setting the schedule, finding speakers and creating promotional materials. Watch your snail mail and e-mail for more information.

MEMBERSHIP

Membership dues invoices have been sent out.

Your membership allows NPA to continue to: 1. Keep Your Industry safe! NPA monitors Federal legislation, and protects the pawn industry’s interest at the Federal level. You have a voice in Washington, DC through the NPA! 2. Provide Access to Solutions: Post a question on our member forum, and get answers from your peers. Stay informed through the monthly e-newsletter and the quarterly magazine.

3. Provide Networking and Educational Opportunities: Pawn Expo, the annual convention & tradeshow, gives you a place to network, share ideas, learn new skills, and meet with vendors.

4. Help Grow Your Business: NPA promotes its members’ businesses through active public relations and the online member directory at www.PawnFyNdR.com.

5. Promote the Pawn Industry: The NPA shines a positive light on your industry through programs such as Gift Day, the annual donation of musical instruments, and the Future Business Leaders scholarship fund.

Renew your membership today, and support the only association that represents the pawn industry!

GRC

Our Government Relations Committee (Team GRC) continues to keep a watchful eye on the

Federal Charter bill. If you haven’t already, please take time to go to the Rally Congress website, act.nationalpawnbrokers.org, and contact your Members of Congress. The letter and information is there for you to review and modify. The program locates your representatives for you. What could be easier?

Save the Date! The NPA Legislative Conference will be held April 16, 2013 at the Hamilton Crowne Plaza in Washington, DC. This is the opportunity for you to meet with your Members of Congress face-toface, and educate them about our unique and necessary industry. Contact Matthew Church, Government Relations Administrator, at matthew@NationalPawnbrokers.org or call him at 817-337-8830 for more information.

Dana Meinecke NPA Executive Director

FBL

You showed incredible generosity during our fundraising campaign for the Future Business Leaders Scholarship Fund (FBL). Over $11,000 has been raised to use towards scholarships for deserving youth. See the story on page 38 in this issue of National Pawnbroker magazine.

If you know a deserving student who would like to apply for a scholarship, go to the NPA website, www.nationalpawnbrokers.org, and click on the “Community Outreach” button on the top menu. There, you will find the information you need to submit their name for consideration.

And there is still time to contribute! Giving to FBL allows NPA to continue to support students in local communities just like yours.

THANK YOU!

I want to again give a big thank you for those exhibitors and sponsors who helped us celebrate our 25th anniversary at Pawn Expo 2012. I would also like to thank our attendees. You came and shared your enthusiasm and knowledge with your fellow pawnbrokers. Networking is the icing on the cake for this already great event.

PAWN EXPO 2013 Save the date: July 16-18, 2013 Las Vegas, NV

I hope each of you has a happy, and profitable, holiday season.

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GOVERNMENT RELATIONS

Preserve, Protect, and Defend NPA IS YOUR EYES AND EARS IN WASHINGTON

THE DEADLINE FOR THIS ARTICLE was prior to the elections. Regardless of the outcome, the NPA’s and your task remains the same: to Preserve, Protect, and Defend the pawn industry.

We see those same three words used in many contexts, from the side of our local sheriff’s car to the presidential oath of office on inauguration day. Let’s take a closer look at the connection between these words: Preserve: To keep; to protect; to maintain the condition of…

Protect: To keep safe; to defend; to prevent harm from coming to…

Defend: To keep; to prevent; to support; to ward off, repel…

There is a constant theme here, beginning with “to keep,” ending at “to ward off, repel.”

This concept was good enough for the founding fathers of these United States, and it has stood the test of time. This phrase relates to the pawn industry as well, and should be taken to heart by all NPA members.

FEDERAL CHARTER BILLS The majority of our recent Washington, DC efforts have centered on the Federal Charter bills.

The proponents of a Federal Charter are spinning it as a enefit to underser ed consumers and small businesses. f the definition of impro ement includes loopholes and vague references that leave much to the imagination of the ffice of the

the consumer. The discussed the difficulty of overseeing the Federal Charter holders and their affiliates anti money laundering compliance programs.

The Conference of State Bank Supervisors (CSBS) offered similar opposing testimony, and they are the best judge of what works and is needed at the state and local levels for both consumers and non depository credit pro iders alike.

FAIR PLAY A s p r e v i o u s l y r e p o r t e d , t h e N PA w a s represented by Fran Bishop, Dollar Pawn, Halleyville, AL, at the July 24th hearing before the Financial Institutions and Consumer Credit Subcommittee of the House Committee on Financial Services. Fran’s testimony on behalf of each one of us centered on maintaining a le el playing field and not picking winners and losers.

The proposed legislation tilts the scales in favor of the large market players and a few mega pro iders with multiple lines of offerings in several states. It leaves small business behind.

These mega pro iders intend to operate, oth nationwide and on the internet, under a Federal Charter and without the following: tate or local licenses aminations egulations or fees oning and signage restrictions ontinuing education re uirements ooperation with law enforcement

It’s never too early to talk about our annual Legislative Conference in Washington, DC on April 16, 2013.

Comptroller of the Currency (OCC), they need to think again. The OCC is their regulatory agency of choice, and it wants no part of any Federal Charter and stated such during the July 24th hearing.

The testified in opposition to a ederal Charter and expressed concerns about its safety and soundness, as well as if it will truly protect

How about that for a sweet deal!

And, while these Federal Charter folks get a free hall pass, you are left dealing with all of the a o ementioned re uirements while trying to serve your customers, maintain your place in the market, keep your employees working, pay the rent, keep the utilities on, keep insurance premiums current, etc.

Larry Nuckols NPA GRC Chair

DO YOU ENJOY POLITICS? CAN YOU THINK OUTSIDE OF THE BOX?

We’re always looking for members who appreciate a challenge to join our Government Relations Team or the Board of Directors. One of the requirements is that you attend our Legislative Conference in Washington, DC, held each Spring. Our board meetings are in July, October and March, and we sure would love to talk to you about joining us! Contact Dana Meinecke, NPA Executive Director at dana@nationalpawnbrokers.org or 817-337-8830 for more information.

(Continues on page 62)

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VENDOR MEMBER SPOTLIGHT NEWS

NPA INDUSTRY PARTNER RAPAPORT AUCTIONS IS THE PREMIER B2B DIAMOND auction house and the leading reseller of diamonds in the world. t represents the largest pawnshop chains, refiners, and diamond wholesalers, providing them with a cash platform to achieve the highest price for their diamonds and consistent cash ow.

Rapaport holds monthly melee and single stone auctions that feature over 30,000cts, from 1 pointers to 5ct+ diamonds.

The auctions draw the most serious diamond and jewelry manufacturers from all major trading centers, and Rapaport’s global reach of over 13,000 companies ensures that suppliers get the most competitive bids for their merchandise.

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What are the benefits of selling diamonds through Rapaport Auctions?

By submitting diamonds into our auction, suppliers get their diamonds exposed to the strongest buyers in the world. With offices in all major trading centers, we target the largest wholesalers, cutters, and manufacturers and have a dedicated global staff focused solely on getting sellers the highest price possible. The auction format is a competitive bidding environment that enables us to achieve strong results and frequently exceed sellers’ expectations, while providing them with consistent cash flow.

Our experienced team of traders and gemologists guide our clients through the process, and our trustworthy reputation offers them peace of mind that their diamonds are secure. Participating in our auctions is easy and seamless and there is absolutely no risk.

How can clients maximize the return for their diamonds through your auctions?

We work very closely with our clients before submitting their goods into an auction. We analyze their merchandise and make sorting and boiling recommendations to achieve a premium. Our expert assessments are based off past experience and industry trends, and we always display the goods in the most beneficial way. We also carefully review the larger stones and offer certifying recommendations where we see fit to achieve higher prices in the auction.

What types of goods do you accept in your auctions?

We sell diamonds in all shapes, sizes and qualities. Our auctions feature mixed breakout, broken and finely assorted melee parcels as well as larger certified and uncertified stones. We accept GIA, IGI, AGS, HRD, and EGL-USA certificates, while stones from other laboratories may be submitted as uncertified.

What makes you stand apart from the competition?

We’re able to leverage our extensive global network of more than 13,000 clients in over 80 countries to foster competitive bids. Utilizing our information network also allows us to maintain our finger on the pulse of the market and know when and where to best sell the diamonds. We hold our auctions in all major diamond centers, including New York,

Israel, Hong Kong, and Belgium and participate in all of the largest diamond and jewelry shows.

We stay on top of all industry trends and are consistently looking for ways to innovate so we offer the best solutions for our clients. The long-term relationships we develop and the professional service we provide are known industrywide, as we always strive to help our clients get the greatest returns for their merchandise while making the process effortless for them.

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What is the current state of the diamond industry?

The diamond market is currently recovering from a slow summer as diamond prices bottomed out in mid-August.

There has been a noticeable increase in prices and trading volume for small melee diamonds, while larger stones still remain relatively flat. We are seeing consistent strong results for fancy shapes due to production shortages while round prices have been more volatile. Market sentiment has improved with traders expecting a reasonably good holiday season. However, there still remains uncertainty and caution for the long-term.

Do you have any additional advice for pawnbrokers?

As diamonds are a very valuable commodity, we strongly recommend that pawnshops work with reputable refiners that have a stone removal process and can return all diamonds. In addition, when selling diamonds, it is important to have a number of companies evaluate the merchandise to achieve a more competitive price. Companies are invited to contact us if they need additional advice or would like a free consultation.

What other services does Rapaport offer that can benefit the pawnshop sector?

Rapaport is the primary source of price and market information to the diamond and jewelry industry and our information services can be very beneficial for the pawn sector.

The Rapaport Diamond Report and our 24/7 online portal, www.diamonds.net, provide up to date market information as well as in-depth price reports. In addition, we run www.

RapNet.com, which is the largest diamond trading network with daily listings of over 950,000 stones valued at over $7 billion. This unique platform enables pawnbrokers to see live market prices and can assist them value, buy, and sell better quality stones of 0.25ct and larger.

How do customers contact you to start participating in auctions?

Clients can call us at 1-800-488-9108 and speak with one of our Trading Managers who are available to answer any questions. They can also e-mail us at auctions@rapaport. com or visit us at www.rapaportauctions.com. We are always happy to assist and look forward to working with you.

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SAVE THE DATE!

NPA LEGISLATIVE CONFERENCE April 16, 2013 Hamilton Crowne Plaza Washington, DC

Contact Matthew Church, matthew@NationalPawnbrokers.org or 817-337-8830, for more information.

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MEMBER NEWS

Become a NPA Board Member!

HELP BUILD THE FUTURE NOW

WE HAVE ALL HEARD THAT MEMBERSHIP has its enefits, and this is generally true. em ership in your fre uent yer program gets you free airline tickets, mem ership in your discount warehouse store sa es you dollars, mem ership in your health clu keeps you fit if you actually use it. hat a out your mem ership in your trade association, the hat does that get you mem ership gets you oice in ashington ccess to your peer group ducation and training p to date information The flip side of the mem ership enefits e uation is that mem ership has its responsi ilities.

STEP UP!

our association is constantly on the hunt for talented, energetic, and moti ated indi iduals to take on leadership roles within the .

QUALIFICATIONS

hat knowledge and skills does a oard mem er need nowledge, e perience and demonstrated commitment to the through ser ice on committees urrent pawn industry e perience, with a strong awareness of issues, relationships, and new emerging trends ecurity in your own a ilities and the a ility to contri ute eyond personal de elopment kill in multi dimensional thinking and analysis nterpersonal relationship skills e an approacha le, sa y am assador for the industry who personally alues and respects other people isionary leadership skills e open to new ideas, a le to prioriti e and consider future directions and ha e a clear iew of the future

STEVE ROGERS Wellston Pawn Warner Robins, GA NPA Board of Directors

Your association is constantly on the hunt for talented, energetic, and motivated individuals to take on leadership roles within the NPA. t is not enough to sit idly y as your association continuously works to keep your industry progressi e, responsi e, and secure. ach of these actions is a massi e undertaking.

There is a constant arrage of threats to the industry, including new financial legislation and stricter controls.

RESPONSIBILITIES

oard mem er s responsi ilities, in con unction with other oard mem ers, include sta lishing the policies and priorities ased on the association s mission, alues, and ision epresenting mem er needs nsuring the financial sta ility and growth of the association romoting the pawn industry as a whole

ecti ity The a ility to e aluate the ideas of others entoring skills willing to help and in est in others, while inspiring confidence and enthusiasm nowledge of the fiduciary role of a go erning ody, or the a ility to learn the role ntegrity e a le to esta lish and maintain a personal code of conduct that ser es as a model for others upport from employers colleagues during the time you ser e on the oard esources that will allow you to make a financial commitment perience leading people, pro ects, programs or companies iscal responsi ility the a ility to e ercise financial responsi ility in association matters assion a out the pawn industry Time to commit to your duties (Continues on page 13)

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MEMBER NEWS

MEMBER NEWS

(Continued from page 12)

TIME COMMITMENT

Directors are elected for one, two-year term.

Your responsibilities may require 2 to 6 hours a week depending upon need and current circumstances. In some cases, more time might be required.

NPA board members will spend time: aking and recei ing phone calls participating in conference calls eading reports, research, riefings, memos, and correspondence, some of which may require responses aintaining communications relati e to committee work e iewing oard meeting agendas and supporting materials prior to each board meeting e iewing minutes of oard and committee meetings The tra el commitments re uired include oard meetings per year. Two of these meetings are in conjunction with other e ents, the nnual egislati e onference and Pawn Expo. There may be miscellaneous assignments that will require one or two days of your time.

The work is essential and the need is genuine. f interested, please contact ecuti e irector ana einecke, dana nationalpawn rokers.org, for more information.

Welcome NPA New Members PAWNBROKERS

GEORGIA

Coastal Loan & Jewelry, Kingsland

ILLINOIS Alexander Coin & Pawn Co, Des Plaines

INDIA House of Jewels, Jaipur

MASSACHUSETTS

INDUSTRY PARTNERS

CALIFORNIA

Unified Payments/Process Pink, Lodi

COLORADO

Mason-Kay, Littleton

TEXAS

Diamonds and Fine Jewelry, Dallas

Elite Time dba Bay State Pawn, Boston

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MEMBER NEWS

Become a NPA Board Member!

CALLING ALL WOMEN! MAKE A DIFFERENCE AND BE PART OF THE TEAM

I’VE BEEN INVITED TO CONTRIBUTE TO this section to speak to the “Women of Pawn.”

If you attended the membership breakfast at Pawn Expo this year, you heard Nancy Martin, Nancy Cejudo, and me pay tribute to our dear friend, Ramona Thompson, who lost her battle with cancer last spring. We, along with several other ladies, all served on the NPA Board of Directors together for a great number of years.

On that day in Las Vegas I issued a challenge to the women in the audience to step forward, take up the NPA banner, and continue our work to make a difference.

ALREADY LEADING

Ladies, we stand behind our pawn counters daily, meeting challenges and solving problems. We are part of a team in our stores, homes, churches, and civic organizations. We take on the role of team player, coach, cheerleader, water-girl, and bat clean-up (literally) all the time.

It is imperative that more “Women of Pawn” take on a leadership role and take their place at the NPA Board of Directors’ table.

All of these come with a range of possible outcomes, including: The achie ement of goals through indi idual commitment to such goals nhancement of group cohesion einforcement of change to organi ational culture We do this daily—at home, in our stores, in everyday life—and don’t think a second about it.

There’s a job that needs to be done, a goal set, and a mission accomplished, and we do it.

We’re always after our kids to get that homework done, our husband to take out the trash or cut the grass, or our employees to keep the counters clean and ready for business.

We apply those bullet points every day and reach the goals.

Now it’s time for you to consider sharing your talents with the NPA. Step into a leadership role in the only national association that represents the pawn industry and your livelihood. At one time there were seven ladies serving as NPA Directors; currently there are only two.

FRAN BISHOP Dollar Pawn, Haleyville, AL

“Women of Pawn” must take on a leadership role and take their place at the NPA Board of Directors’ table.

There are many interpretations of “leadership.”

Consider the following: The process of directing the eha ior of others toward the accomplishment of common objectives n uencing people to get things done to a standard and quality above their norm and doing it willingly process of in uence

Please give serious thought to attending the next board meeting. See what it’s all about. Don’t hesitate to give me, or any of the other ladies who served on the board, a call and ask about our experience.

As a NPA Director, you will be rewarded with a lifetime of friendships, a wealth of knowledge, and a great sense of accomplishment.

For more information, contact Dana Meinecke, dana@nationalpawnbrokers.org.

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Let us be your one-stop resource.

Your business and trust is important to us, that is why we offer in-person appointments to all our clients. Call us today for your free quote.

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COMMUNITY INVOLVEMENT

Making Music and Smiles

NPA GIFT DAY TEAMS UP WITH THE MR. HOLLAND’S OPUS FOUNDATION

For more information or to get started giving, go to www.giftday.org and sign up!

ON DECEMBER 6, 2012, THE NATIONAL PAWNBROKERS Association (NPA) will sponsor its fourth annual Musical Instrument Gift Day. You can join pawnbrokers from around the country and donate musical instruments to organizations in need.

CELEBRATE BY GIVING

December 6th is National Pawnbrokers Day as well as St Nicholas Day. St. Nicholas is the patron saint of pawn brokers because of his service to those in need.

Take advantage of this opportunity to participate and give back to schools that do not have the resources to provide instruments to students.

WHY SHOULD YOU PARTICIPATE IN GIFT DAY 2012?

Keep the pawnbroker tradition of giving alive Saint Nicholas of Myra, the Patron Saint of pawnbroking, is famed for his generosity to the poor and for his penchant for secretly leaving gifts for people in need. He is recognized in America as Santa Claus and his three bags of gold has become the international symbol of pawnbrokers.

Support the national community outreach and charity efforts of the NPA Donating one guitar is great, but through the combined efforts of the NPA members, hundreds or thousands of instruments can really make an impact!

Give to children who need it the most The Mr. Holland’s Opus Foundation knows that the Title 1

school music programs that they select are desperately in need of your help.

Become a part of Mr. Holland’s dream For more information or to get started, visit www.GiftDay.org.

ABOUT MR. HOLLAND’S OPUS FOUNDATION

An infusion of instruments enables more students to participate and to experience a quality music education. It is vital that efforts are made to give youngsters every tool available within the small window of time when they can make the most of their education and e perience the enefits inherent in learning to play music.

The Mr. Holland’s Opus Foundation was inspired by the acclaimed motion picture Mr. Holland’s Opus, the story of the profound effect a dedicated music teacher had on generations of students. Every year an average of 10,000 young people across the country enefit from the foundation s programs.

The film s composer, ichael amen, started the foundation in 1996 as his commitment to the future of music education.

Both new and refurbished instruments are donated by the foundation to school music programs that lack the resources to for equipment that is lost due to attrition, depreciation and wear over time. These instruments are presented to students on waiting lists or to those who have to share instruments.

The foundation has established a thorough process by which organizations are chosen to receive donations and handles all aspects of the process. Donations are awarded to established Title 1 school- music programs throughout the country. Each recipient organi ation must apply for a grant and meet the ualifications established by the Foundation.

Give the Gift of Music!

How do I donate?

Go to www.giftday.org and complete our donation form. You will have the option to: • Ship high-quality, pre-owned musical instruments directly to the Mr. Holland’s Opus Foundation.

• Purchase new instruments through the Mr. Holland’s Opus Foundation that will be shipped directly to the Title 1 school music program.

• Make cash donations directly to the Mr. Holland’s Opus Foundation on behalf of the NPA musical Gift Day. Your contribution will be converted to musical instruments.

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Rowan Middle School in Jackson, MS A 2012 NPA GIFT DAY RECIPIENT

PAWNBROKERS ARE HELPING ROWAN MIDDLE School in Jackson, MS. The school has been recommended by the Mr. Holland’s Opus Foundation as a recipient of support from the NPA’s Annual Musical Instrument Gift Day. Rowan Middle School serves 214 students in grades 6-8. inety fi e percent of the students that attend the school participate in the National Free/Reduced Lunch Program. It is a Title 1 school.

Music teacher Lynise Little teaches beginning band, intermediate band, and marching band. The school’s annual music budget for music program expenses is only $1,000. The school has a small inventory of musical instruments that are over 20 years old, many of which are beyond repair and unplayable.

Because there are more students wanting to participate than there are instruments available, Little is borrowing instruments from other schools when possible. This borrowing still does not satisfy the need and many students are sharing instruments. In some cases, they are sharing mouthpieces by using a sanitation spray in between use.

The school is in need of the following instruments to eliminate borrowing from other schools, replace instruments in inventory that are beyond repair and to accommodate the number of students that want to participate in the program: concert tu as set of timpani utes clarinets alto sa ophones trumpets trom ones marching aritone sousaphone pair of crash cym als

They are also in need of clarinet, alto sax, trumpet and trombone mouthpieces in order to eliminate sharing which, even with the sanitation spray, is not very sanitary. e urge you to take the time to isit ift ay.org and find out how you can help. NPA members have always shown an enthusiasm for helping organizations like Rowan Middle School, and we are confident that our com ined efforts will meet their needs and allow them to operate a sustainable music program.

For more information on how you can donate, visit www.GiftDay.org.

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✓

CHECK THIS OFF YOUR LIST

RENEW YOUR NPA MEMBERSHIP TODAY!

Don’t miss out on any NPA member benefits!

✓

❑ Stay informed via Legislative Alerts, National Pawnbroker magazine, and NPA Insider e-newsletter

✓

❑ Build professional relationships with other industry members by attending the annual Legislative Conference and Pawn Expo Convention and Tradeshow

✓

❑ Voice your opinions and support legislation in Washington, DC through the use of Rally Congress

✓ ✓ Give back to your community by participating in Musical Instrument Gift Day ❑ ❑ Get free publicity for your store with a listing on PawnFyNdR.com

and Future Business Leaders Scholarship Program Renew now for 2013 by calling Margie Swoyer at the NPA office: 817-337-8830. Membership expires 12/31/12.

Coming together is a beginning; keeping together is progress; working together is success. – Henry Ford

COMPLIANCE STORE

As an NPA member, you will receive a FREE 2013 State and Federal labor law poster set in your membership packet!

The NPA Compliance Store has all of the tools you need to help you with OSHA requirements, at discount prices just for NPA members.

www.npacompliancestore.com

• • • • •

First Aid Harassment Prevention Training Labor Law Posters Training Signage

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FEATURE

Compliance Boot Camp 2012

by ROBERT FRIMET, CAMS

WELL, JUST AS IN THE MILITARY, IT’S TIME TO BRUSH up, hit the PT, whip yourself into shape, and get ready to immerse one’s self in the world of compliance.

As they say, a sharp, well-trained soldier is a live soldier and, if you want your business to live long and prosper, you have to know the rules. So, put on your skivvies. It’s time to hit the trenches once again and get the Kung Fu grip back in action!

FORM 8300 COMPLIANCE

e all know what a form is and how to fill it out, right For those who have forgotten, are new to the world of pawn, or are a proud new edgling, let s ha e a total recall session, shall we Imagine that it’s 2030, you’re a pawn ninja, and sales are red hot.

A customer comes in and buys that blingy Rolex for $12,500 and walks out the door. A month later, you are audited by the IRS and, when asked for your form 8300’s, you say, “What is that As they cart you away in the paddy wagon… as it ust a dream r could it e a reality ell, may e not the paddy wagon part, but if you’re a trade or business (i.e., a pawnbroker), you have to know the rules or be subject to the pain that results from ignorance.

SO, LET’S BEGIN!

As a trade or business, your company is required to follow Title 26 of the United States Code and to report cash transactions to the Internal Revenue Service (IRS.) There are four triggers that can lead you to file a form under Title

1

If a customer makes a purchase that exceeds $10,000 cash-in at your location in a business day, the business is re u red to file a for on the transact on There are two magic words in the last sentence ne of those words is cash. f it s not cash, you do not file unless it s a designated transaction (more information to come.) The second one is cash in. form will ne er e filed on a customer payout.

The primary reason is that the government wants to monitor cash-in transactions, which they may then investigate for money laundering if the transactions meet certain criteria.

If you’re paying the customer out, and you’re a licensed entity, the government will make the initial presumption that you are not laundering money through your business out to the customer (unless they determine otherwise.)

2

he second tr er s called a related transact on There are two definitions that apply to these transactions. The first is the same as trigger number one, but covers a 24-hour period.

The second definition of a related transaction would apply if a customer pawned an item and continually paid interest on the item so that the principal and interest exceeded $10,000 on that item in pawn over a 12-month period. This would e defined as a related transaction and re uire a form to e filed.

If the customer pawned an item and picked it up; pawned it again a week later and picked it up; and pawned it three weeks later and picked it up, there would be no required form filing, as the transactions are not related as defined y the go ernment.

Think of it as a chain. If the link is broken it is no longer a chain. It’s a piece of scrap. So, if the link is not broken, and the transaction continues (whether you write a new pawn ticket or not) it’s a chain and would be considered a related transaction.

Once the chain is broken, you start over. Keep in mind, the tally is for a rolling, 12-month period, not a calendar year.

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3

4

Just as any good soldier must know how to tear down their M-16 blindfolded, it’s your responsibility to monitor and track these transactions to ensure compliance with form 8300 requirements.

The statement may be sent regular mail or, with the customer’s written permission, y e mail. ou are not re uired to use certified mail. copy of the statement should e kept on file at your store.

The third trigger is a designated transaction, which is the combination of cash and certain negotiable instruments (limited to cashier’s checks, bank drafts, traveler’s checks, and money orders). The definition does not include personal checks because the government can keep track of those transactions on bank statements.

A cashier’s check or money order may be untraceable by big brother. If a customer presents a negotiable instrument combined with cash and the amount of the cash-in equals over $10,000, you have a designated transaction and must file a form .

If a customer pays with a $7,000 money order and with , cash, you would file a form . f you ha e a customer who pays , y cashier s check, there is no filing as there was no combination of cash and a negotiable instrument.

Credit cards, debit cards, sheep, horses, cattle (got that from Cajun Pawn Stars), or personal check payments com ined with cash would not trigger a form filing.

ou may now oluntarily file electronically. This is e pected to ecome mandatory in the first or second uarter of , though no official notice has een pro ided. n order to register to file electronically, go to http saefiling. fincen.treas.go main.html. or those who still wish to file y mail, there is a new form 8300, effective July 2012. This form can e downloaded y isiting http www.fincen.go forms files fin casho er k.pdf .

Questions? Get in touch with your drill sergeant through the National Pawnbrokers Association.

he final tr er s a susp c ous transact on for hs s a oluntary fil n and ould nclude any transact on about h ch you ha e susp c on If you have a customer trying to trade two yaks for a double eagle (yes, another Cajun Pawn Stars episode), it is okay. Otherwise, suspicious activity is subjective.

The determination of what is or is not suspicious is up to the business owner and should in part be based upon the types of transactions that the location processes. If you see a transaction that just doesn’t look right or a customer with multiple transactions that don t fit your usiness model and you believe it to be tied to money-related crimes, you can report it.

Some examples of customers who may be trying to avoid e ceeding the , limit which would re uire you to file a form 8300 might include: person is reaks up transactions throughout the day wife who suddenly appears to pay off a loan that the husband has been paying on since its inception If your customer comes into your store with XM 132 iper rocket launcher, it might e a good time to file a suspicious activity report, unless you’re recording a pawn reality show episode. In that case, it might be acceptable.

WHAT’S NEW FOR FORM 8300?

PRECIOUS METALS

There has been a lot of chatter lately on precious metals front.

The government did what it does with most regulations: they put the word out, and allowed time for the affected industry to adopt the rules. Now it may be hammer time, and I am not referring to the guy with the baggy pants. am not trying to imply that any particular dealer will e fined.

My intention is to inform you that audits are on the rise, and all dealers in precious metals must comply with federal regulations.

(Continues on page 59)

PROVIDING NOTICE

f you do happen to file a form on a customer, you must send them a statement that explains that the following transactions in the amount of $_____ were reported to the IRS on form 8300.

The statement must include your company’s name, address, and phone number and the name of a contact person at your store.

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HUMAN RESOURCES

The Most Difficult Job YOU WILL EVER LOVE! NOW THAT THE GOLD RUSH IS WINDING down a bit, most of us are focusing on and getting back to the business of how to be a great pawnbroker.

Several years of picking low hanging fruit (think money) by buying and selling large quantities of gold have come and gone. Now comes a reality check for all of us.

Do we remember how to make money at the loan counter?

If we have hired and trained the talent necessary to operate our businesses, the answer is, “Yes, we remember how to make money at the loan counter.” If, however, we do not have the requisite talent to maximize every loan and sale, then we may be in for a rough ride from smaller loan balances, curtailed sales, unsatisfactory gross profit, and a general ina ility of our store teams to be productive.

TALENT

Hiring exceptional talent is critical to our business, or any other business for that matter.

We should never settle for less than the best.

Strong human resource management is crucial, whether we are looking for a store manager who can be a visionary leader, a manager who can quickly execute business plans, or a sales and

Top talent will always be in demand, so it is in our best interest to treat hiring as a year-round, never ending, and critical business process.

The following are a few steps that will lead to more productive store teams: lways e looking for talent. m race a good definition of talent such as: Talent is a recurring pattern of thought, feeling or behavior that can be productively applied. se a consistent set of inter iew uestions when interviewing new hire candidates.

Do not jump around and ask questions you like. Make the questions count. o not assume you are good at interviewing. Talk to those who have successfully staffed their stores to find out what they asked new hire candidates, or simply search on line for good questions. se a relia le uestionnaire to help you identify talented candidates. There are dozens available. Talk to someone who has used questionnaires successfully. o not assume anything when re iewing applications or resumes. Ask questions. ire only those who understand what you expect.

We should never be willing to settle for mediocre employees. lending associate who is engaged and will not settle for less than 100% when delivering to our customers and our bottom line.

We should never be willing to settle for mediocre employees.

Why settle for second best when recruiting and hiring new team members? The answer to that question can be the deciding factor that separates a profita le pawn shop from one that does not reach its profit potential.

DAVID JOHNS Five Star Pawn & Jewelry, La Grange, KY David Johns has a long history as a driving force behind the success of privately held pawn chains in the United States. The programs he has developed over the past twenty years to select and retain talented pawn shop employees is often presented in seminars and conferences around the country. His family has been in the pawn industry for several decades, and he is currently involved in establishing a new chain of shops throughout the Southeast.

WATCH FOR MORE

I’ll be writing future articles for National Pawnbroker magazine that will provide more detailed information about what to look for on an application or resume as well as a standard set of interview questions to ask new hire candidates. t is difficult to find and hire the est. uture articles will help you lo e the most difficult o you will ever have, hiring talent.

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COMPLIANCE

Weighing in on Scale Selection

by DON ONWILER, Executive Director, NCWM

FOLKS ARE BRINGING THEIR JEWELRY TO PAWN shops and attending house parties to cash in on a “golden” opportunity. This increased market for buying and selling gold has also created an increased demand for jeweler scales.

Unfortunately, there is some frustration among scale dealers, ewelry uyers, and regulatory officials o er these scales. ell intended business people are purchasing new scales only to learn from the inspector that they are not suitable for commercial use.

It isn’t as easy as buying a $50.00 “jeweler scale” off the internet.

HOW DO YOU KNOW WHAT SCALE TO BUY?

The National Conference on Weights and Measures (NCWM) de elops the nited tates standards for weights and measures. also administers the ational Type aluation rogram T . cale manufacturers apply for T certification for their de ices y su mitting prototypes for e aluation. authori es go ernment la oratories to e aluate the scales for compliance to national standards. This e aluation goes well eyond the tests an inspector can perform, e.g., e aluating the effects of temperature, barometric pressure, power supply, and the a ility to maintain cali ration o er time and normal use.

AN IMPORTANT EVALUATION

our scale protects your profit margin, so these assurances are significant. They are so important that states re uire any new scale placed in commercial ser ice to e tracea le to a T ertificate of onformance. learly, T certification is a primary factor in selecting an appropriate scale. But there are other considerations. or e ample, you wouldn t consider pricing fine ewelry o er a scale that has one pound increments. en if it is accurate, it lacks precision, only weighing to the nearest pound.

That’s common sense, but how much precision is necessary?

What units of measure do you need? Pounds? Ounces? Troy ounces? Pennyweight? Karat? Where will the scale be used? n inspector will look at things like air mo ement, i rations, and so forth that could cause the installation to be unsuitable, especially for precision weighing. think you re getting the point. There are re uirements to e met re uirements that are important to you and important to your customers. Here are some tips to help you make a good in estment.

Know the Requirements: Call your state weights and measures authority to find out what they re uire for scale capacity and di ision si e also referred to as reada ility or scale increment). Be prepared to describe the commodities you will e weighing and the uantity or si e of typical weighments. tates ary on re uirements in this regard, so it s an important uestion. or state y state contact information, go to www.ncwm.net. Point to “Resources” and select “State Directors Contact Information.”

(Continues on page 58)

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BUSINESS MEMBER NEWS SENSE

Eight Things Every Seller Should Know Reprinted with permission. All rights reserved.

Copyright DL Perkins, LLC. © 2012.

Acquisition Advisors is a business unit of DL Perkins, LLC. To learn more about Acquisition Advisors, go to www.AcquisitionAdvisors.com.

YOU’VE DEVOTED UNTOLD TIME, MONEY AND energy to building and running your business. It may well represent your life’s work and net worth. Now you’ve decided that it is finally the right time to sell. ere are eight things you should know.

1

2

3

Financially, you may be better off keeping your business.

Buyers buy businesses for the income they can receive.

They look at past profit performance to predict the future and then pay a price that will allow a fair, risk-adjusted return.

Small businesses sell for three to five times pre-interest, pre-tax earnings. If your business generates annual benefits to you totaling $500K, which includes $200K for managing the business, the true profit of your business is $300K. A buyer might pay $1.2 million. Some seller financing will probably be required as well.

But assume you receive all the cash at closing, pay your taxes and expenses, pocket $800,000, and invest this sum at five percent. Your annual income will now be $40,000.

You’ve taken a major pay cut. In short, selling a business may be more like buying your freedom.

4

5

If your primary pitch Is “This business could…,” save your breath. Buyers of private businesses are a conservative bunch. If they are not, their bosses, lenders, or financial backers will require them to be.

As such, they must rely on solid historical performance to justify their purchase price. Business sellers who try to peg most of the value on what the business “could” do typically waste everyone’s time and lose credibility.

Buyers don’t have to buy. They only put their money at risk when they find a good deal. If you take an impartial view and think you wouldn’t do it, it’s likely nobody else will either.

To maximize value, be open to seller financing. If you ask for 100 percent cash at closing, experience shows you’ll typically receive a much lower total price. This is because the amount of cash that the buyer has and the amount the bank will lend are usually relatively fixed amounts. The sum of the buyer’s cash and bank financing is the maximum you can receive at closing.

Now, would you like more? Offer some seller-financing.

Worst case is you don’t get paid your entire seller-financing portion, but you still received more than the all-cash price!

6

They won’t appreciate the work that went into building your business. Unfortunately, buyers look at your business simply as an investment. They won’t appreciate the blood, sweat and tears you put into building it.

But, you’ll always have the pride of knowing what you accomplished and the respect of those who watched you do it.

Don’t expect any more from a buyer than a fair price. Oh, and don’t bother with the “this business is so very unique” shtick. Every business is unique. Buyers just care about the cash it generates.

Buyers love it when you represent yourself. In fact, many buyers looking for the best deals will exclusively target private business owners who have no representation and have little prior experience in buying and selling businesses.

More often than not, they’re going to end up squeezing you for a better price for the business than they initially promised and you initially expected. They will flatter you in the early stages and become aggressive in negotiations in the latter stages. Few sellers are experienced in business sales or valuation.

All sellers are emotional when it comes to selling their “baby.” No seller is objective. As the saying goes, “If you represent yourself, you have a fool for a client.”

Do your heirs a favor and hire an expert to assist you.

Choose right and they’ll more than pay for themselves.

Your competitors may not be the best buyers. Sure, competitors are logical buyer candidates and quite easy to identify. So you contact the owner of XYZ and ask, “Are you interested?”

Now he has a free chance to gather information that will help him compete against you. And even if you don’t send him your confidential information, he’ll use the fact that you want to sell against you—starting today.

(Continues on page 61)

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FEATURE

Discovery Channel’s Final Offer: BEHIND THE SCENES WITH JORDAN TABACH-BANK

by EMMETT MURPHY, 3 CLiCk Media

National Pawnbrokers Association Question (NPAQ): How did the

sco ery hannel find you Jordan Tabach-Bank Answer (JTB A): Patrick Painter, one of my fellow dealers, actually suggested me to the producers at Fremantle. They probably were not seeking out a pawnbroker, but I did some mock negotiations on camera and the rest is history.

NPA Q: d you ha e reser at ons about be n on JTB A: I have been approached by several production companies

to shoot reality shows on Beverly Loan Company, but for privacy reasons cannot ha e cameras in my office. Final Offer was a fabulous opportunity to promote my business and my industry on a sound stage without iolating customer confidentiality.

seller has an understanding of the value of their item, but only if I absolutely knew a seller would make it to all four rooms. One nice part a out eing first is you can close the deal immediately, as I did with the Blues Brothers glasses, the Energizer Bunny and the Kashmir sapphire.

NPA Q: re you fr endly th the co pet t on JTB A: I actually really enjoyed spending time with the other three

dealers, but it did get highly competitive. We all have different specialties, but we all have a similar set of skills—and we all love negotiating and hate to lose! There were even some side deals off camera, which I probably shouldn’t discuss.

NPA Q: hat as your fa or te te that you bou ht JTB A: That’s a no-brainer! The 8.88 carat Kashmir sapphire.

and to showcase what I do on a daily basis – negotiate to purchase unique one-of-a-kind items.

Jewelry, especially diamonds and colored stones, is Beverly Loan’s specialty so this was right in my wheelhouse. It is absolutely exquisite and I paid a fair price at $200,000, but left enough room to make a healthy profit. true win win.

NPA Q: o do you th n you fared a a nst your co pet t on JTB A: s a high end pawn roker, we speciali e primarily in fine

NPA Q: hat te do you sh you had bou ht JTB A: lo ed the ower dress worn y arilyn

NPA Q: d you en oy the e per ence JTB A: Yes! It was great being able to be in a creative environment,

jewelry, watches and art. But luckily I also have a background in sports and entertainment memorabilia, giving me a leg up against Patrick, Billy and Jake, all very successful and colorful dealers.

A lot of the items that I came home with were related to movies, television, music and pop culture, including the Blues Brothers glasses, the Nascar hoods, the Energizer Bunny and the Elvis Presley hair.

NPA Q: hat separates Final Offer fro the ult tude of buy sell ant u n sho s on cable JTB A: Our show reminds me of a cross between Antiques Roadshow and Shark Tank. And when we purchase something, we actually write a check. I shelled out over a quarter of a million dollars of my company’s money. When you see us sweating…we are not acting. Trust me.

as chosen first by sellers hat es JTB A: Sellers seemed to trust that I understood the true value of the item and would give them a fair, honest price, so they visited me first. actually would prefer to e the last room, after the

onroe, ut the seller priced it far too high. Her expectations were totally unreasonable, and I don’t think she’ll ever get better prices than those offered on the show.

NPA Q: hat as the h hl ht of the first season JTB A: The highlight of season one was having the chance to help

out a young mother. She brought in some props from the Blues Brothers. The items had belonged to her father, a propmaster on the iconic film, who had recently passed away. he was selling the items to help support her daughter. I ended up purchasing the entire collection, but gave her back a pair of the sunglasses as a gift to her daughter who never had the opportunity to meet the seller’s father (her grandfather).

NPA Q: ould you do t a a n JTB A: In a heartbeat!

NPA Q: It see s that your roo

often

NPA Q: hat ould you do d fferently JTB A: Not much. I would continue to study my auction records,

because that seemed to be my most successful negotiating tactic!

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SPECIAL NOTICE

P.O. Box 8450, Van Nuys, California, 91409 info@northamericanmetals.com

(818) 373-8078 (800) 773-1626 FAX (818) 366-1410

Open letter to the industry As many of you know, in January of 2009, we learned that precious metal previously delivered to a third party for safekeeping had been converted. The inventory was insured by Lloyds of London.

What you may not have known is that Lloyds denied our claim and refused to pay on the policy. We were forced to sue the third party, its principals, and Lloyds in an attempt to restore what was taken. Those lawsuits took the better part of three and a half years. During that time, the majority of our customers patiently waited, understanding that we were fighting not only to protect our interests but theirs as well. Only one customer chose not to wait, suing and ultimately settling with us.

I am happy to announce that in the last month, we prevailed in the first suit. Shortly thereafter, an offer of settlement was made by Lloyds that we have chosen to accept. While the combined sums offered do not make us entirely whole – taking into consideration the loss, passage of three years, and costs of pursuing the claims – the amount provides enough to repay every one of our customers for their losses. By the time you read this, all of our customers that had entrusted to us precious metal and who had so patiently awaited resolution of the litigation will have been repaid in whole with interest, and, we are grateful to say, came back to us.

In these last three and a half years we have learned much and have used what we have learned to build a better North American Metals. NAM is sound. NAM is stronger financially than we have ever been. We are well positioned for the future. We are, in many respects, a better company than we have ever been. We are paying competitive rates and providing competitive services.

We also know that trust can be built over years and lost in a moment. We greatly appreciate the patience of so many and hope that by challenges that we have endured and trials as to which we have prevailed, we can regain your trust. If you worked with us before and left us because of uncertainty, we invite you to return. If you are looking for a company where customer service is not just a phrase, but instead where it means, loyalty, commitment, responsibility and dependability, we are your company. If you are looking for people who do what they say they are going to do, we are your company. If you are looking for a company that will stand with you no matter what the challenge, then we are your company.

Thank you.

Sincerely, Michael Elliott, President North American Metals

Solder • Alloy • Bullion • Coins • Casting Grain • Prompt Returns • Hedging • Advances • Assays • C.O.C.’s Tecnical Support • INSURED INTEGRITY • PROVEN RELIABILITY • Staff Training

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SPECIAL EVENTS

SHOT Show® Education

THIS GIANT TRADE SHOW OFFERS FIREARMS RETAILERS INCREDIBLE BUSINESS-BUILDING AND LEARNING OPPORTUNITIES

by GLENN SAPIR, NSSF Director, Editorial Services YOU ARE INVITED TO ATTEND THE 2013 SHOT SHOW, which is proudly owned and sponsored by The National Shooting Sports Foundation. Last year more than 36,000 retailers attended the SHOT Show in Las Vegas and went home smarter business people than when they first arri ed.

Start by registering at www.shotshow.org. The website also has other helpful information to maximize your SHOT Show experience.

A BETTER INFORMED RETAILER

Las Vegas may be better known for fun than education, but walking the aisles of the SHOT Show and being exposed to the new products and ser ices can t help ut make any pawn roker a better informed retailer. ttendees will find more than , e hi itors in the firearms, ammunition, hunting, and shooting sports industry.

SHOT SHOW UNIVERSITY MONDAY, JANUARY 14, 2013

ou will also find other ways to strengthen your usiness acumen.

That “formal” education can begin a day earlier, when the latest edition of T how ni ersitySM unfolds at the Sands. or a relati ely ine pensi e tuition, you can learn from e perts in—and out of— the industry in a daylong series of sessions.

The lineup for this year s T how ni ersity is stellar. ere s a rundown of the planned curriculum tate of the ndustry, ames e ney, resident , mith and Wesson ow to reate utrageously ffecti e arketing aterials, Ron Rosenberg ® ompliance onsultants pen ic orum, with retired T officials ally elson, ick couffas, red erlach and arry c a e etailer pen orum, with staff of the ational hooting Sports Foundation® and some of the best and brightest retailers in the firearms industry reate a ifelong ustomer, ill endy, sales and marketing e pert consultant ell ath o ury ike a ustomer corned, ancy Friedman, the Telephone Doctor The Tool o of igital ommunications, rian ykes ow ot to e a howroom for ma on, o hi s, the Retail Doctor

2013 SHOT Show, January 15-18 Sands Expo & Convention Center Las Vegas, NV

(Continues on page 41)

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Retail/Range Membership Application

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Tel (203) 426-1320

▲

Fax (203) 426-1087

▲

www.nssf.org

SHOT Show® Anniversary Special

This application is designed to accommodate firearms retailers, existing shooting ranges, shooting range developers, shooting ranges with a retail component, not-for-profit shooting ranges or providers of range services to both existing and development-stage ranges. This category is for both existing and start-up retailers and/or ranges.

Business/Organization name _________________________________________________________________ Mailing address ____________________________________________________________________________ City _____________________________________________ State ______________

Zip _______________

Phone_______________________________________ Fax ______________________________________ Website ____________________________________________________________________________ o Established Business

o Start-up Business – o Retailer or o Range

Primary contacts: Name _______________________________________ Title ________________________________________ E-mail _____________________________________________________________________________________ (Please list individual designated for liaison between company and NSSF first.

Name _______________________________________ Title ________________________________________ E-mail _____________________________________________________________________________________ Name _______________________________________ Title ________________________________________ E-mail _____________________________________________________________________________________ If you should have any questions or would like to email application please email Samantha Hughes at shughes@nssf.org.

Sales from hunting/shooting items.

Dues Structure: o <$1 Million ........................................................... $35.00 o $1 Million but less than $10 Million ................... $70.00

Please make check payable to NSSF or enter your credit card information: o MasterCard o Visa o Am. Express o Discover

o $10 Million but less than $20 Million ............ $1,500.00

Card #:_____________________________________

o $20 Million but less than $30 Million ............ $3,000.00

Security code: _________ Exp. Date: ___________

o $30 Million but less than $40 Million ............ $4,500.00 o $40 Million but less than $50 Million ............ $6,000.00 o $50 Million but less than $60 Million ............ $7,500.00

Signature: __________________________________ Membership is non-refundable and no extensions will be granted for non-usage.

o $60 Million but less than $70 Million ............ $9,000.00 o $70 Million but less than $80 Million .......... $10,500.00 o $80 Million but less than $90 Million .......... $12,000.00 o $90 Million but less than $100 Million ........ $13,500.00 o Over $100 Million ......................................... $15,000.00 (Capped at $15,000)

o

Yes, I would like the Industry Reference Guide Member Price .................................................. $45.00 Please include cost in membership payment.

Does not apply for multi-chain and big box stores.

Please turn over

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o Firearms Retailer Please complete this section if you are engaged in the business of selling shooting sports related equipment and products. As a member of the National Shooting Sports Foundation you will receive all NSSF mailings, information and benefits that will help you run a more successful business.

Choose one of the following: o Firearms FFL# __________________________ o Accessories

Number of employees __________________

If multiple locations, how many? __________________

o Shooting Range Please complete this section if your club or business has a shooting range. As a member of the National Shooting Sports Foundation you will receive all NSSF mailings, information and benefits that will help you run a more successful shooting range.

Please provide the required information for where to shoot: Range Location __________________________________________________________________________________ ________________________________________________________________________________________________ o Public

o Private

o Shooting Range Developer

o Outdoor Range(s)

o Indoor Range(s)

o Both

o Military o Hunting Preserve

o Municipal o Law Enforcement

o Public Access

o Members only

Range Details o Sportsmen’s Club o Commercial Range

Access o Handicapped o Memberships Available

Now that you are a NSSF range member, please provide additional information by logging on to wheretoshoot.org

o Yes, please send me Bullet Points, our weekly electronic industry newsletter, via email.

Business Type (check one): o Individual/Sole Proprietorship o Nonprofit Corporation

o Partnership/LLP

o Corporation

o Unincorporated Association

o LLC (check one): o LLC – Taxed as a Sole Proprietorship o LLC – Taxed as a Partnership o LLC – Taxed as a Corporation

NSSF CORPORATE MEMBER CONSENT: If your entity is a corporation or an LLC that has elected to be treated as a corporation under IRS rules, please complete the attached corporate member consent form to participate in and receive important information about the NSSF Political Action Committee.

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COMMUNITY INVOLVEMENT

2012 FBL and C.O.P.S. Awards NPA GIVES BACK

NPA continues its commitment to reward high standards of excellence in academic achievement and community leadership.

Ethan Beckner (center) accepts his FBL scholarship check from Robert McCullough (right), Pawn Plus, Macomb, IL. Macomb’s Mayor, Mike Inman (left,) joins them for the presentation.

WE ARE PLEASED TO ANNOUNCE THE RECIPIENTS of this year’s Future Business Leaders (FBL) Scholarships. The following six students were selected to each receive a $1,000 scholarship:

Arielle Baker, Fairmont, WV Sponsor, Westside Pawn, TN

Kelsie Holden, Niles, MI Sponsor, Worldwide Jewelry & Pawn, South Bend, IN

Nicholas Owens, Sylacauga, AL Sponsor, Sylacauga Pawn, Sylacauga, AL

Paige Matheson, Goodwater, AL Sponsor, Sylacauga Pawn Shop, Sylacauga, AL

Ethan Beckner, Tennessee, IL Sponsor, Pawn Plus, Macomb, IL

Wesley Strong, Sylacauga, AL Sponsor, Sylacauga Pawn Shop, Sylacauga, AL The FBL program was established to provide scholarships to individual applicants who are planning to enroll, or are enrolled, at an accredited two-year, four-year college, or trade school.

ualified applicants are the children, grandchild, a customer, employee, or individual sponsored by a member in good standing in the NPA. Student selection is based on academic performance, community leadership, and written essay submissions.

C.O.P.S.

NPA also awarded two $1000 scholarships to Concerns of Police Survivors (C.O.P.S.). Since 1994, C.O.P.S. has donated over a million dollars in scholarships to sur i ors of fallen officers that do not recei e tuition free education as a state death enefit.

C.O.P.S. also provides scholarships to survivors who no longer meet their state’s eligibility for assistance.

In addition, a $2000 scholarship was awarded to the Sgt. Tim Chapin Memorial Fund in memory of fallen Chattanooga, Tennessee police officer gt. Tim hapin. Tim, known for his unwavering service and dedication throughout his community, believed education was one important way to build strong, sustainable communities.

In 2011, Sgt. Chapin came to the scene of a robbery in progress at NPA member, US Money Shops, Chattanooga, TN. During the course of the ro ery, gt. hapin was shot and killed. This scholarship serves as a tribute to the men and women who serve and protect the public.

NPA is proud to be an active member in our communities y gi ing through programs like the uture usiness eaders Scholarship program.

38 | NATIONAL PAWNBROKERS ASSOCIATION | FALL 2012

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Thank You!

2013 FBL SCHOLARSHIP CONTRIBUTORS NPA ASKED AND, AS ALWAYS, OUR MEMBERS DELIVERED. WE’VE RAISED OVER $11,000 IN SCHOLARSHIP money for future business leaders. Thank you for supporting students’ dreams!

1st American Pawn L & S Pawn Shop

Bluestone Trading Co.

Express Cash Pawn

John’s Loan & Jewelry

Carson Jewelry & Loan

Express Pawn

Carson City, NV

West Haven, CT

Johnson Brothers’ Jewelry & Loan

Cartersville Pawn-N-Shop

First Pawn Jewelry & Loan

Cartersville, GA

Naples, FL

Cash Exchange

Fulton Loan Office

Clinton Township, MI

Atlanta, GA

Cash Loan

Gene’s Pawn Shop 1

South San Francisco, CA

N Charleston, SC

Cash N More Pawn & Jewelry

General Refining Corp

Wichita Falls, TX

Hempstead, NY

Center Gold

Gloucester Pawn

Assured Coin & Loan

Chuck’s Gun & Pawn Shop

Gold N’ Coins & Jewelry

Gardena, CA

Warner Robins, GA

Atlas Loan & Jewelry Co

Clark Pawners and Jewelers

Southlake, TX

A Perfect Pawn Greenville, SC

ABC Jewelry Inc.

Sterling Heights, MI

Acme Pawn

Jonesboro, GA

All American Pawn Sparks, NV

Amboy Check-X-Change Perth Amboy, NJ

America’s Super Pawn Oneco, FL

Bellflower, CA

Cleveland, OH

Centereach, NY

Chicago, IL

Avenue Pawn

Cloud Ten

Batesville Gun & Pawn Shop

Dan’s Discount Jewelry

Bayou Pawn & Jewelry #1

Dan’s Pawn

Kansas City, MO Batesville, MS Zachary, LA

Bend Pawn & Trading Co Bend, OR

Berry’s Pawn of Madison Madison, TN

Best Collateral- Central Services Novato, CA

Mishawaka, IN Richmond, KY

Panama City, FL

Dellinger’s Pawnbrokers Washington, NC

Dixie Pawn

Charlottesville, VA

Dixie Pawn

Harrisonburg, VA

Best Pawn Shop

Dixie Pawn

Big Daddy’s

Dynasty Jewelry & Loan

Euclid, OH

Manassas, VA

Oklahoma City, OK

K & K Loans

KK’s Loan, Music & Jewelry Manchester, TN

White Marsh, VA La Habra, CA

Gold Pawn Brokers Mesa, AZ

KK’s Loan, Music & Jewelry II Tullahoma, TN

Lake Jewelry & Loan Round Lake, IL

Larry’s Jewelry & Pawn Florence, AL

Leo Marks Jewelers Toledo, OH

Lew Silver Diamond Brokers Southfield, MI

Greenbrier Pawn Chesapeake, VA

Griswold’s

Lincoln Square Pawnbrokers New York, NY

Magazine Pawn Shop

Gallup, NM

New Orleans, LA

Heather’s Pawn Loans Oklahoma City, OK

Herman’s Pawn Shop Collinsville, IL

Magnolia LLC dba Best Pawn & Exchange Montgomery, AL

Manassas Pawn Manassas, VA

Himelsein

Santa Barbara, CA

Hudson’s Pawn & Gun Jasper, AL

IAS Training

Lakewood, CO

Jerry’s Jewelry & Pawn Shelbyville, KY

Norcross, GA

Big Rock Trading Post

E Z Jewelry & Loan

Jery’s Pawn & Shooters Supply

Waterflow, NM

Westminster, CA

Fayetteville, NC

Bill’s Pawn

Easton Loan Company

Jessup’s of New Smyrna

Saint Louis, MO

Mansfield, OH

Buckhannon, WV

Jackson, MS

El Dorado, AR

Las Vegas, NV

New Smyrna Beach, FL

Manhattan Pawn Shop Manhattan, KS

Marv’s Place

Cheyenne, WY

Mentor Financial Jewelry and Loan Mentor, OH

Mid Florida Gold & Gun Spring Hill, FL

Mission Pawn Mission, KS

Mo Money Pawn Shop Phoenix, AZ

(Continues on page 64)

FALL 2012 | NATIONAL PAWNBROKERS ASSOCIATION | 39

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LET US BECOME YOUR ONLINE RESOURCE stullerpawn.com

You do it all. One minute you’re negotiating the price on a lawn mower and the next you’re selling a two-carat diamond ring.

Stuller realizes all the roles you play and has created a website to take the hassle out of at least one part of your business. We’re the solution for all your jewelry needs.

Enjoy a variety of benefits: The Pawn Pick of the Week: New bench, repair, and jewelry items each week, all specific to your business and available at a reduced price.

Tips from the Tool Guy: All the best information about the products and services we offer to help your business succeed. Complete with video tutorials featuring Andy “the Tool Guy” Kroungold on everything from displaying your jewelry to rhodium plating.

Stuller’s Pawn Team: Stay connected to a team of Stuller professionals dedicated to your industry.

Trend Highlights: Our experts weigh in on what’s hot in the pawn industry, particularly jewelry and bench work.

And best of all, sign-up is free! So let Stuller be the source for all of your jewelry needs.

Visit stullerpawn.com. A place just for you.

stuller.com

Stuller FP_adtemp_fp.indd FP.indd 1 2

Phone 337-262-7700

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SPECIAL EVENTS

Stuller Bridge

FIRST EVER EVENT ENGAGES PAWNBROKERS

IT WILL NOT BE BIGGER STORES BEATING OUT the smaller in today’s changing retail landscape, but the fast adapters beating out the slow. This fact moved Stuller to host 90 pawn rokers for their first e er awn ridge e ent, cto er , 2012 at their corporate headquarters in Lafayette, Louisiana.

The goal of the event was to engage Stuller’s pawnbroker partners in meaningful conversation about how the industry is changing. In addition, Stuller presented solutions designed to ma imi e profits in ewelry sales. tuller in ited participants to attend seminars on topics as varied as diamond cutting and repair, testing techni ues, metal refining, refur ishing and polishing best practices, selling with technology, and showcase solutions for ewelry and watches.

The ourney started a year ago, when tuller in ited leaders to oin their awn d isory ouncil. The company hoped to etter understand pawnbrokers’ needs and identify the opportunities and challenges which uni uely define the pawn industry.

From those sessions, many ideas emerged, including snap set earrings and pendants for quick mounting of loose stones, duos and trios for ma imum profit in ridal, digital selling solutions through Stuller Showcase and StullerPawn.com, as well as increased awareness through presence at tradeshows and the Stuller Bridge event.

The group also identified the ad antage of ndy the Tool uy, a tour guide leading customers through tuller s many products and ser ices. f there s one thing our customers tell us over and over again, it’s that they had no idea of how much we can do for them, says im c lung, irector of awn for tuller.

Steve Rogers of Wellston Pawn in Warner Robbins, GA, re ected, elie e your tuller s approach and presentations were spot on and progressive. Matt’s open acknowledgment of the difference between the historic, somewhat stained image of pawnshops, and our current efforts to reshape our brand was astute and embracing. I think that these efforts will pay continuing enefits for oth industries.

With plans already underway for next year’s event, Stuller hopes to strengthen its partnership with the pawn industry and continue to find new solutions for its pawn partners.

SPECIAL EVENTS

(Continued from page 33)

SHOT Show

®

Other educational options are available to SHOT Show attendees, including retailer and ATF seminars, as well as the Law Enforcement Education Program (LEEP).

RETAIL SEMINARS

At $20 a session or $100 for all six, the retail seminars offer you the opportunity to pick and choose topics that are of interest to you, or attend all six at a bargain price.

ATF SEMINARS

For a real education on compliance with the regulations enforced by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), you can attend seminars presented by that agency. Nothing like getting information from the horse’s mouth!

WEDNESDAY, JANUARY 16, 2013

TUESDAY, JANUARY 15, 2013

“Detecting and Avoiding Illegal Straw Purchases” Learn what you can do to detect and avoid unknowingly participating in illegal straw purchases.

THURSDAY, JANUARY 17, 2013

10:30-11:30 a.m. ATF from the Inside Out; “Providing You with the Tools to Excel” Learn about the host of educational resources ATF provides the firearms industry, from on site training to online ideo seminars.

1-2 p.m.

2:30-3:30 p.m.

9-10 a.m.

Co-op Advertising, Bill Kendy FBI/NICS: Alien & Non-Immigrant Alien Presentation, Kim Brown

Financials for the Firearms Retailer, Tracy Moffatt 10:30-11:30 a.m. How to Write a Business Plan for the Firearms Retailer, Tracy Moffatt 1-2 p.m.

Store Security & Inventory Procedures for the Firearms Retailer, Fred Gerlach & Nick Scouffas 2:30-3:30 p.m.

Search Engine Optimization (SEO) Social Marketing, Bill Dunn

9-10 a.m.

ATF/NICS TOWN HALL MEETING

1-5:30 p.m.

You can learn more about these programs, as well as the Law Enforcement Education Program, on the SHOT Show website, www.shotshow.org.

FALL 2012 | NATIONAL PAWNBROKERS ASSOCIATION | 41

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FEATURE

Holiday PRESSure

WHAT TO SAY (AND WHAT NOT TO SAY) TO REPORTERS

by EMMETT MURPHY, 3CLICK MEDIA

LAST DECEMBER, MORE THAN 300 STORIES ABOUT pawn stores appeared in broadcast, print, and digital media across the U.S. There is no evidence that this year will be any different.

If you are approached by a journalist interested in an interview, feel free to contact NPA and request a free consultation with Emmett Murphy, NPA Public Relations consultant. This consultation is quick and will help prepare you for the interview.

The session will orient you to any potential negative issues or emerging news stories.

YOU REPRESENT THE INDUSTRY When a member of the media approaches you about a story, remember that you are representing the pawn industry.

Pending legislation such as the Federal Charter threatens pawn stores’ abilities to fairly compete in the marketplace.

Now more than ever, it is vital that we protect our personal, business, and industry image and promote awareness of the important financial ser ices pawn stores pro ide to merican consumers every day.

START BY ASKING THEM QUESTIONS Yes, you have the right to ask questions about the interview beforehand.

Ask the person who contacts you what kind of story is planned? For example, is it “Bargain Holiday Shopping,” or “Bad Places to Shop for Gifts?”

Try to find out what uestions they will ask. ou can ask for a list of questions ahead of time to prepare.

You can also suggest questions. Some good ones might include: ow does a pawn loan work ho are your customers hat is going on with gold pricing PREPARE Have a list of talking points prepared for your interview. Know exactly what you want to communicate during the interview, no matter what questions are asked.

For example, if you’ll be talking about gold prices you may consider the following talking points: awn stores ha e trained staff that can test your gold on site. This means that you don’t have to mail your gold off to an unknown, cash-for- gold company. awn stores scales are regulated and tested y government agencies. You know that you will receive a fair, accurate price for your gold.

The price of gold has een good for the pawn industry, but even better for the public who, now more than e er, needs financial help. awn stores are regulated on a state, local, and federal level. awn stores ser e their communities. awn rokers strive to be valued and respected by their communities.

Know your talking points and stick to them. If a reporter attempts to mislead you or steer you onto a subject you’re not comfortable discussing, maneuver the conversation back to your original talking points. Be polite, calm, and direct. Engage the journalist by making eye contact.

INTERVIEW TABOO DO NOT talk about or reference any human body part, product, or related attachment (e.g. teeth, dentures, prosthetic limbs, human remains, false hair, or cremation urns) as unusual items against which you’ve provided a loan.

We know that every pawnbroker has a great story, unique pawned item, or unusual experience, but save these for your friends. This type of imagery negatively impacts the general public’s view of your industry.

From a reporters’ point of view, this type of subject

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matter is perfect for a sensational headline that will generate readership. Your great story WILL be used in an article, to the detriment of your business and the image of the industry.

Don’t be the evening news’ freak show.

Have an interesting answer already prepared for the question, “What’s the most unusual item a customer has pawned?” Be sure to think of a few items that, while not as shocking or bizarre as others, have interesting stories attached to them.

Even better, mention something that you received that helped someone in need.

Don’t be the evening news’ freak show.

From the public’s standpoint, interesting items may be high-end or unusual jewelry, antiques, important documents, collectibles, celebrity encounters, celebrity related items, or gold coins with a history.

Visit NationalPawnbrokers.org and PawnShopsToday.com for more up to date information that may help you prepare for an unexpected interview. You can also download the Pawn PR 101 brochure by going to http://assets.nationalpawnbrokers. org/2011/04/PR101WEB.pdf Remember: The only bad PR is PR you don’t control.

Feel free to contact NPA and request a free consultation with Emmett Murphy, NPA Public Relations consultant.

Email info@nationalpawnbrokers.org or call 817-337-8830.

PAWN INDUSTRY FACTS YOU SHOULD SHARE Pawn businesses are heavily regulated and licensed by state and local governments.

Pawn loans are usually small, short-term loans as evidenced by the low national average loan amount of $120 and have no negative credit effect.

Pawn businesses are governed by all of the 13 major federal laws that apply to other entities designated as financial institutions.

Pawn loans keep borrowers out of a debt cycle, as opposed to other forms of nonbank lenders.

Pawn stores lend to anyone and use collateral to secure a loan. Pawn stores never pull a credit report.

Pawn transactions are routinely transmitted to local law enforcement, which dramatically decreases the likelihood that a thief would bring stolen merchandise to a pawn store.

With a pawn loan, there is never an obligation on the part of the borrower to repay the loan, nor is there ever an adverse impact to one’s credit rating in the event of a default.

Less than one-half of one percent of pawned items is reported as stolen.

FALL 2012 | NATIONAL PAWNBROKERS ASSOCIATION | 43

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COMPLIANCE

Important Notice to all Federal Firearms Licensees

FROM THE U.S. DEPARTMENT OF JUSTICE BUREAU OF ALCOHOL, TOBACCO, FIREARMS AND EXPLOSIVES, WWW.ATF.GOV

ATF FORM 4473, FIREARMS TRANSACTION RECORD Part I – Over-the-Counter (Form 4473) has been revised. This letter highlights the changes to the form. You should review the entire revised form including all of the Important Notices, Instructions to Transferee/Buyer, Instructions to Transferor/ eller, and efinitions. ll ederal firearms licensees s must begin using this form on July 9, 2012 (not earlier). After that date, you may no longer use the previous edition (August 2008) of the Form 4473 as it will be obsolete.

The changes to Form 4473 include the following: Section A: uestion . This item has een di ided into two sections Race and Ethnicity. You must select at least one race in item 10.b. regardless of ethnicity designation selected in item 10.a. Both items must be answered. uestion .l. This item was amended to clarify that this category of prohibited persons is limited to aliens who are admitted to the United States under a nonimmigrant visa. uestion . This item was amended to clarify that this category of prohibited persons is limited to aliens who are admitted to the United States under a nonimmigrant visa.

Section B: uestion c. roof of days continuous residency is no longer required for any alien. uestion d. enum ered uestion c. This item was amended to clarify that this category of prohibited persons is limited to aliens who are admitted to the United States under a nonimmigrant visa.

FORMS

If you need additional forms, please contact the ATF Distribution Center at (202) 648-6420 or you may order online at http://www. atf.gov/forms/dcof/. You may also print the Form 4473 from the ATF website and make copies as needed.

E-FORM 4473 APPLICATION

ATF has updated the electronic Form 4473 (e-Form 4473) application. On July 9, 2012, the revised e-Form 4473 application will be posted and available for download at: http:// www.atf.go applications. ll s must ensure that they are using the correct e-Form 4473 version on that date.

Auracle Gold Tester Deluxe Kit The Auracle AGT-1 is a breakthrough in gold testing due to its speed, accuracy and simplicity.

Unlike other testers whose accuracy is dependent upon complicated testing instructions, preparation procedures, cleaning or refrigeration, the Auracle indicates karat value within a second by simply touching the test object with the probe.

There are no messy solutions or acids that stain your clothes or hands or damage the object you’re testing.

Kit includes: • Auracle Gold Tester • Pen Probe • 9V Alkaline Battery • AC Adapter, Dual Voltage • Rubberized storage/ carrying case for easy portability

NOTICES, INSTRUCTIONS AND DEFINITIONS

The instructions to the corresponding questions from above were revised accordingly.

In addition, the most frequently asked questions and answers regarding the revised Form 4473 can be found at the ATF website (www.atf.gov.)

Item# 817-1045

$459.00

QUESTIONS

If you have additional questions regarding the revised Form , please contact your local T office. listing may e found at http www.atf.go field .

Proud Members of:

201 Hancock Avenue • Bridgeport, CT 06605, USA 203-366-5400, 800-243-4466 • Fax 203-366-3953 www.gesswein.com • E-mail: info@gesswein.com

44 | NATIONAL PAWNBROKERS ASSOCIATION | FALL 2012 Pawnbroker NPA AD 11-2012.indd 1 044_npa_fall12_CS5.indd 44

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TECHNOLOGY

Mobile Banking and You OPENING THE DOOR FOR FRAUD

WITH THE INTERNET CAME VIRUSES. With credit availability came identity theft. Now with the convenience of mobile banking, comes new ways for check fraud and theft.

It is estimated that somewhere between forty and one hundred items per million payments get processed as duplicates. This is an increase of more than o er what was first e pected when remote check capture was introduced.

This is only the tip of the iceberg.

CHECK SCANNING

Imagine this: You cash a check from your customer to pay for a purchase or money owed.

Previously, they scanned the same check into their bank before coming to you with the actual paper item. This allows them to get paid twice, and leaves you holding the bag.

The rules from a Uniform Commercial Code perspecti e are that the first item of deposit has seniority. So, if you had cashed the check first and it hit the ank first, you would be ok. But, in this case, the customer cashed the copy of the check via their cell phone and then cashed the original item with your business.

UCC was set in place long before check scanning. UCC varies from state to state, but regulations apply to stop payments, late returns, and holder in due course issues. Would check scanning via mobile phone be covered? It appears not, as this is fraud and not a matter of UCC. Once cashed, the check would most likely be returned as “duplicate” or Refer to Maker.

As a matter of law, the paying bank has 2 days to return the check to your bank, who in turn returns it to you. If it is an out of state bank, the bank has 3 to 4 days.

If an item is returned after that deadline, you may have a shot at returning it through your bank as a late return, if your bank is willing to help you. If not, based on the current regulations, the business owner accepting the check may be out of luck.

You can’t sue the customer’s bank, as they did their job by accepting payment and clearing the item. The customer has an agreement with their bank not to misuse the mobile service. This protects the bank, not you, Joe Pawnbroker. They have no idea that their customer cashed the item twice.

WHAT’S LEFT?

You may have a fraud case or small claims action. Many states have aggressive bad check units via the local district attorney. However, they normally only co er non sufficient funds and account closed items.

You will have to prove that it was not an accident that the customer was paid twice because they scanned the check into their phone then cashed the same check with you.

Even the police may not be able to prove beyond a reasonable doubt that the action was not accidental and therefore not criminal as there is no such thing as “check slaughter” (Unlike man slaughter).

It’s going to be a hard road to travel until the Fed comes out with new regulations on mobile banking. The fraud and crime will continue. You just need to know what’s out there.

So, as we soak up all the new technology, there will be some heartburn. But let’s face it, where would we be without Yahoo, Google, and remote controls.

ROBERT FRIMET, CAMS Robert Frimet is President of RMF Consulting Group, Inc. and is a Certified Anti-Money Laundering Specialist (CAMS) serving the pawn, check cashing, payday, title, and other industries since 1991.

Mr. Frimet offers compliance services nationwide and may be reached at 866-204-7209 or at Bob@checkconsultants.com.

So what types of crime do we face with mobile banking technology • Advance fee scams: ustomers are duped to send funds under fake circumstances.

• Vishing/smishing: sing of phone call or SMS to gather personal details such as account numbers, P Ns, or personal identi cation details.

• Payroll fraud: Non-e istent or ghost employees receiving paychecks.

• False transactions: Sending fake SMS to make customers believe a transaction was successful, often accompanied by a reversal request.

• Internal fraud: mployees colluding for unfair personal nancial gain.

• Identity theft: mployees accessing and e ploiting customer information without authori ation.

• Reversal requests: ustomers requesting that successful transactions be reversed.

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MEMBERSHIP

2013 State Association Contacts AL

IN

MS

Rob Barnett, Pres AL Pawnbrokers Assoc. alapawnbrokers@gmail.com

Greg Engstrom, Pres IN Pawnbrokers Assoc. gregengstrom@hotmail.com

Kevin Macdonald, Pres MS Pawnbrokers Assoc. sterryroadpawn@gmail.com

AR

Ron Stempkowski, Exec Dir IN Pawnbrokers Assoc.

(219) 261-3173 1ipa@comcast.net

Todd Coutts Montana State Contact toddcinmt@yahoo.com

Tim Collier, Pres AR Pawnbrokers Assoc. hogtim@windstream.net

CA

Diane Taylor, Pres CAPA dtaylor393@aol.com

KS

Robin Tummons, Pres KS Pawnbrokers Assoc. hsofstuartltd@yahoo.com

KY

Kim Andosca, Exec Dir CAPA (209) 786-5115 kandosca@caltel.com

Mona Prestigiacomo KY State Contact mojopresto@yahoo.com

CO

Chad Carter, Pres LA Pawnbrokers Assoc. chadcarterlpba@yahoo.com

Tim Lanham CO Pawnbrokerâ&#x20AC;&#x2122;s Assoc. tlanham@mmi-corp.com

CT

Jay Sargent, Pres CT Pawnbrokers Assoc. sales@tcspawn.com

DC

Jessica Barakat DC State Contact crownpawn@aol.com

FL

Tom Sams, Pres FL Pawnbrokers Assoc. upg@capitalsystems.net

GA

Ben Levinson GA State Contact ben_dynasty@comcast.net

HI

Richard Dan HI State Contact bigrich@aloha.net

LA

Butch Tinker Govt Relations bigapawn@aol.com

MA

Edward Bean, Pres MA Pawnbrokers Assoc. suffolkjewelers@gmail.com

MD

Rick Sussman, Pres MD Pawnbrokers Assoc. ricksuss@aol.com

MI

Seth Gold MI State Contact seth@americanjewelryonline.com Mark Aubrey MI State Contact tonyaubreysr@gmail.com

MN

IA

Brad Rixmann, Pres MN Pawnbrokers Assoc. brad.rixmann@ pawnamerica.com

IL

William Howell, Pres MO Pawnbrokers Assoc. stljewelryandloan@yahoo.com

Lynden Miller IA State Contact moneyandmoreic@gmail.com David Schoeneman, Pres IL Pawnbrokers Assoc. schoedad@aol.com

MO

Rob Lauer Govt Relations rob@pawncenter.com

MT

NC

Bob Moulton, Pres Pawnbrokers Assoc. of NC moultonbob@yahoo.com

NE

SC

Janis Feazelle, Pres SC Pawnbrokers Assoc. pawnpeople@aol.com

TN

Glen Coronis, Pres TN Pawnbrokers Assoc. gcoronis@usmoneyshops.com

TX

Peggy Roden, Exec Dir TX Pawnbrokers Assoc.

(972) 506-9575 tap@rmaus.net

NH

Larry Nuckols, Pres San Antonio Pawnbrokers Assoc.

(972) 506-9575 larry@pmibiz.com

NV

Mike Katsanevas UT State Contact mikek@crownslc.com

Bruce Kaiman NE State Contact sols16@qwestoffice.net Roger Weinreich NH State Contact tod@worldpath.net Erminia Drobkin Nevada State Contact erminia@pioneerloan.com Michael Mack Nevada State Contact michael@max-pawn.com

NY

Eric Modell, Pres Collateral Loanbrokers Assoc. of NY eric@modellfinancial.com

UT

VA

Jerry Bouchard, Pres VA Pawnbrokers Assoc. jbouchard@cox.net

WA

Nancy Cejudo WA State Contact nancycejudo@aol.com

WI

OH

Greg Baer WI State Contact stores.57@mmi-corp.com

OK

Brent Kalafat, Pres WV Pawnbrokers Assoc. kalamoreconsulting@yahoo.com

OR

John Mason WY State Contact lincolnwaypawn@msn.com

Lou Tansky, Pres Ohio Pawnbrokers Assoc. lou@unclebenspawnshop.com Phillip Church OK State Contact superpawn@coxinet.net Earl Oller, Pres OR Pawnbrokers Assoc. eoller@pawntalk.com

PA

Stanton Myerson PA State Contact smyerson@ hillgateinvestments.com

WV

WY

We have several states without an NPA representative. If your state is not listed and you are interested, please email dana@ nationalpawnbrokers.org.

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STATE NEWS

State Association Updates WHATâ&#x20AC;&#x2122;S GOING ON ACROSS THE COUNTRY

ALABAMA Robert Barnett, President Alabama Pawnbrokers Association WE HOPE YOU WERE ABLE TO join Alabama pawnbrokers in October at the Wynfrey Hotel in Birmingham for our annual Alabama Pawnbrokers Association state meeting. Thank you to Scott Corscadden of State Banking for his presentation on regulatory updates, and ATF regulatory compliance inspectors for their presentations.

We would also like to thank David Siminski of United Precious etals efining for his informati e talk on gold refining. a id s talk pro ided a etter understanding of the gold refining process and several new ways that pawnbrokers can receive maximum returns when refining their gold. e are currently re amping our association s we site. e now have the ability to quickly update information about current events affecting Alabama pawnbrokers. Check out our website at www.AlabamaPawnbrokers.net for important updates.

Remember to mark your calendars for the 2013 Dixie Pawnbrokers Educational Conference and Trade Show at the Hilton New Orleans Riverside Hotel, April 19-21. The Dixie is a joint effort between the Alabama, Arkansas, Louisiana, and ississippi awn rokers ssociations. This year s con ention in New Orleans was spectacular, and we are looking forward to having an even larger Dixie convention in 2013.

ARKANSAS

makes sure that buyers of precious metals are now held to the same standards for hold periods and reporting requirements as pawnbrokers.

Because of the pro-active stance of the association, we were able to write the code in a manner that we felt comfortable with. ust another lesson don t wait for someone else to regulate your business. Make every attempt to do it yourself, so you can be a part of the process.

ILLINOIS David Schoeneman G. G., President Illinois Pawnbrokers Association LAST MONTH WE HAD ANOTHER well attended meeting. ur current focus is on updating the llinois Pawnbrokers Association constitution.

On the local front, our state government is so wrapped up in state debt, pension, and tax-related issues that our legislative initiatives went nowhere. Since both the House and Senate are focused on the budgetary morass, we continue to do business as usual.

Both major national chain stores and independent pawn stores continue to open at a remarkable rate. According to our state regulators, llinois currently has acti e pawn licenses and more are in the works. a e a safe and profita le holiday season.

INDIANA

Tim Collier, President Arkansas Pawnbrokers Association

Greg Engstrom, President Indiana Panwbrokers Association

THE ARKANSAS PAWNBROKERS Association (APA) is now actively certifying Legal for Trade cales for the industry after eing notified y the rkansas ureau of Standards that pawnbrokers are required to have Legal for Trade Scales. While this is not a new law, pawn has only recently egan to fall under the di ision s enforcement of the law. t was nice to y under the radar for a while.

With the help of the bureau, the APA purchased a weight kit and the necessary tools required to calibrate and certify scales used for weighing gold and silver. We now provide this service free of charge as a enefit to our mem er stores and, for a small fee, to non-members.

With gold buying stores opening up across the state, the APA also worked diligently with the Arkansas State Police to rewrite the Precious Metals Buyers Act in the state code. This revamp

, , with a myriad of new local ordinances to combat unregulated and unlicensed gold buyers, many of whom operate out of temporary locations and even hotel rooms for a day. plethora of different local groups are fighting this pro lem.

This has prompted the ndiana awn rokers ssociation to help the state legislature draft statutes that will require registration and regulation of all jewelry and gold buyers. This should ease the pressure and help us come up with solutions. t has een a year project, and we are hoping that the revised bill will get the support and passage we e worked for.

The idwest awn rokers on ention in ndianapolis this past summer was a huge success, and we are looking forward to ouis ille, entucky in ay of . nformation will e a aila le at www.midwestpawnconvention.org.

(Continues on page 51)

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(From page 49)

STATE NEWS

The IPA also sponsored a week-long diamond grading course by the Gemological Institute of America (GIA) in Indianapolis during October. We hope to hold it again next year. If you are interested, please contact Ron Stempkowski at Ron@indianapawnbrokers.org.

MISSISSIPPI Kevin Macdonald, President Mississippi Pawnbrokers Association EVERYTHING IN MISSISSIPPI IS rolling along ust fine.

We just wrapped up our last continuing education class for the year in Grenada, MS and were privileged to have Doron Benbenisty of the Counter Terrorism Training School (CRI) in Las Vegas teach us some basic self-defense techniques. He also taught us what to look for to spot possible home invasions and store robberies. Over 200 pawnbrokers attended Benbenisty’s classes at two different venues this year. He is going to be a hard act to follow.

The annual Dixie Pawnbrokers Educational Conference and Trade Show will again be held in New Orleans, LA on April 1921, 2013 at the Hilton New Orleans Riverside hotel. Last year was a huge success and, with this being the second year in New Orleans, we are looking for an even larger turnout. We will have at least 52 vendors and a great group of speakers.

This year is shaping up to be busier than usual in the Mississippi

legislature. The election is over, and I think our industry will have a larger than normal number of bills introduced. We will see.

SOUTH CAROLINA Janis Feazelle, President South Carolina Pawnbrokers Association AS MOST OF THE SC PAWNBROKERS are aware, the South Carolina Department of Consumer Affairs has issued a postcard statement in which they will be addressing a change in our current law presented to the 2012 Senate.

I have been in contact with the department and, in conjunction with the association, we are involved with these negotiations. We are looking at a very active and crucial year. Member input is encouraged and valued, as this will affect all pawnbrokers.

Information on the Southeast Regional Tradeshow and Convention has been sent out. I look forward to this year, as Georgia has a packed weekend of educational seminars planned.

The exhibit hall will have the newest supplies, merchandise, and business advances to enhance and increase your business. There will be information that will spur employee growth and enhance managers’ skills—something for everyone.

If you have never joined us, this is your year. For more information go to PawnCon2012.com, or call 866-438-7296.

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STATE NEWS

CLANY Reaches Out to State Police

by ERIC MODELL, President Collateral Loanbrokers Association of New York ON TUESDAY, SEPTEMBER 18, 2012, THE COLLATERAL Loanbrokers Association of New York (CLANY) attended the New York State Chiefs of Police Association Expo in untington, . This was the first time had e er attended an e po as a endor.

CLANY President, Eric Modell and Vice President, Veronica antwell manned the ooth. ur goal was to speak to as many law enforcement officers as we could in an effort to clarify the ser ice pawnshops pro ide to the public. We worked to instill the belief that pawnbrokers are eager to work with law enforcement. e elie e that law enforcement sees pawnshops as synonymous with second hand dealers and that we work with stolen property. This was an opportunity to change that opinion.

The e po was open to chiefs of departments as well as se eral ranking officers looking for ad anced technology crime fighting tools. Attendance was far less than expected, due in part to the horrible weather. ttendees had a uestioning look on their face as they read our anner and found out we were the only endors not selling anything. Their confusion, and our ashing red and lue ashlights, made for a great con ersation starter. ost of those we spoke to had stereotyped pawnshops as the

places where thie es go to sell stolen merchandise. nce we got this out in the open, we were a le to tell them what pawnshops do, who we ser e, and why we are not an outlet for stolen property. hile none of the officers we spoke to were ones who regularly isited pawnshops in their municipalities, they all took the information we were pro iding and assured us they would pass it along to the appropriate people in their departments. elie e that e en though officers were hunting for tactical riot gear, sirens and lights, on oard camera e uipment, license plate readers, or other cool stuff that only cops can get, the ones that isited the ooth learned something a out pawnshops that they did not know the day efore.

The officers that we spoke with e pressed gratitude for our eing there and demonstrating that pawn rokers do in fact want to work with law enforcement, not against them. f course, we made oursel es a aila le for any future uestions that they, or others in their departments, might ha e.

This was definitely a worthwhile effort and one that see CLANY continuing to participate in in the future. I would encourage other state associations to get in ol ed with their local hiefs of olice ssociations or other local law enforcement e pos.

INDUSTRY NEWS

Chinese Delegation Visits EZ Pawn

auren aminsky, ice resident of awn, poses with staff and isitors from hina at the anhattan location. aminsky said, They asked ery interesting uestions, and left happy. e spent most of the time talking a out pawn in

ew ork.

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BUSINESS SENSE

Data = Trade Secrets

by LOU TANSKY, President, Ohio Pawnbrokers Association

MUCH OF THE VALUE IN THE BUSINESSES WE operate resides in the information we collect, organize, and maintain over time. From the inventories of goods we accumulate to the amounts we loan on such goods, information is critical to our businesses.

At the same time, we have statutory reporting requirements set out in law that o lige us to regularly report specified information to local law enforcement.

In recent years, third-party data aggregators have started collecting such information in place of statutorily-designated law enforcement personnel.

Why do those third-party data aggregators want the information? Perhaps the information is commercially valuable. If that is the case, it could be subject to reasonable efforts to preserve confidentiality ecause it is can e classified as a trade secret.

ESTABLISHING A TRADE SECRET PROGRAM

In brief, any information that 1) is commercially valuable because it’s not generally known, and 2) subject to reasonable efforts to preserve its secrecy or confidentiality, may e protecta le as a trade secret.

This obviously represents a new undertaking in our industry and there will be many questions to address as we implement such measures.

The value in the businesses we operate resides in the information we collect, organize, and maintain over time.

- Consider preparing and disseminating a written policy rohi it disclosure of confidential information to any unauthorized parties Implementing the elements of such a program will involve both planning and communicating.

PLANNING

onsider creating a written policy. onsider the information that you collect, organi e, and maintain, and determine what you may want, and be able, to protect as a trade secret. ecide whether such information should e designated or marked and how you will do it. onsider who should ha e access to that information and how to control access. Consider creating a limited access place to keep such information. lan how to est to communicate the duty of confidentiality.

Key elements in establishing a trade secret program are to: dentify and designate trade secret information. common practice is to mark it as “CONFIDENTIAL.” ontrol access to such information. nly your employees (and perhaps only certain employees) should have access. ommunicate the o ligation to keep such information confidential.

(Continues on page 60)

Some tips on working with law enforcement •

Document every law enforcement inquiry with department name, name of o cer, badge number, date, and time and include the information provided or requested. is can be recorded in a notebook that you keep beside your phone.

•

Assign a primary contact person to communicate with law enforcement agencies and have a backup when the primary is not available. is maintains consistency in the way you provide information. A law enforcement agency cannot say one person gave certain info, yet another refused.

•

f you are not able to easily identify the o cer with whom you are speaking if by phone , ask for a call back number. f given a cell number, indicate you are happy to provide the information they require, but you must verify their identity by calling them through the department’s switch board.

• hen visited in person by law enforcement, ask for identi cation and a business card, if available. ecord all information as outlined above and request a signed receipt.

is receipt can be easily designed and needs to include the information outlined above and be signed by the o cer.

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COMPLIANCE

NICS News

MODIFICATIONS TO FORM 4473

THE FBI CRIMINAL JUSTICE INFORMATION SERVICES Division’s National Instant Criminal Background Check System (NICS) Section promotes the many tools developed at the re uest of the firearm dealer to impro e their e perience. od ficat on to the ureau of lcohol, obacco, rear s and plos es or and rocess n a I ac round hec On July 9, 2012, all Federal Firearms Licensees (FFL) were directed to begin using the new version of the ATF Form . f you ha e not read the open letters pu lished on the ATF Web site, you can view them by visiting this Web site: www.atf.go firearms open letters.

The open letters pertaining to these changes were published on December 8, 2011, “Future Amendment of Nonimmigrant Alien Provisions” and December 22, 2011, tate of esidence. n short, as of uly , , it is no longer necessary to collect a nonimmigrant s days proof of residency prior to conducting a ackground check. n addition, only a nonimmigrant admitted under a nonimmigrant isa is re uired to ha e an e ception. efer to uestion and 12 on the ATF form 4473)

he sa e uest on ll be as ed for b Valid responses (multiple responses can be received) for 10b include: merican ndian or laska ati e sian lack or frican merican ati e awaiian or ther acific slander hite ttent on ll s The thnicity a and ace are oth re uired fields. heck sers f the customer selects ot Hispanic or Latino,” provide the code or codes listed in uestion .

The oint of ontact states ha e een notified of these modifications changes.

As of July 9, 2012, FFL’s should be using a new version of the ATF Form 4473.

When the FFL calls to conduct a background check on a non . . citi en lien , the ontracted all enters and heck no longer ask hat e ception did the buyer provide?” The question now asked by the NICS ontracted all enter and heck is, hat response was provided on Question 12?” The FFL response should e es, o, or ot answered.

In add t on, uest on , re ard n race on the ne ers on of the or , s no captured th t o separate uest ons a thn c ty b ace he I ontracted all enter ll as , custo er respond to a A valid response for 10a is either of the following: ispanic or atino ot ispanic or atino

o

d d the

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P A I D

A D V E R T I S E M E N T

P A I D

A D V E R T I S E M E N T 11/1/12 6:34 AM

COMPLIANCE (Continued from page 24)

Weighing In Go Window Shopping: Ask your state weights and measures official for a listing of registered or licensed ser ice agents for small scales. all these companies, e plain what you need and ask for pricing. Tell them it needs to meet the state s re uirements for commercial use. They know what that means. f they don t sell such precision scales, they may e a le to recommend another source. o you shop the internet ou can get some good deals out there, ut it s a uyer eware en ironment.

The seller is not communicating with you to understand your needs like a local dealer would. earch for eweler scale legal for trade or something similar. o ahead and get some pricing on specific models, ut don t rush to check out.

Make a List: ookmark your we sites and retain your uotes from scale dealers. ou re ound to see a ast range of pricing, features, and options. on t e o erwhelmed. ust make a list of scales that interest you, including make, model, and T ertificate num er if one was pro ided.

onfir efore ou uy ust ecause an ad ertisement says T ertified or legal for trade doesn t make it true. e cautious and confirm it first. ou can ask your weights and measures office to erify T certification, or you can go to our we site. imply go to www.ncwm.net and click the T logo at the top of the page. ust like that, you ha e the entire data ase of T ertificates of onformance at your fingertips. There are se eral ways to search for your scale.

The est is to enter the certificate num er if you ha e it. f not, you can enter a model or a manufacturer. The model can get a little tricky ecause of terminology. f you find the certificate listed in your search results, look under the tatus column to make sure it is cti e. ow call your state weights and measures authority again. on t worry they will e glad to help you. i e them the information and ask them if the scale can e appro ed.

They will confirm T certification and pro a ly ask some uestions again a out how you plan to use the scale.

That s it. ith a little homework you ha e peace of mind. ou ha e in ested a it more in the scale, ut with proper care it will protect your profit margin. That s ust good usiness.

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FEATURE (Continued from page 21)

Boot Camp There is a lot of confusion about the requirements. It is important to know that the definition of a dealer has nothing to do with a specific, single transaction. nce the usiness is defined as a dealer in precious metals, it must implement policies and procedures that will guide the entire operation as a precious metals dealer. f a usiness does not meet all of the re uirements, it is not defined as a dealer. This means it is not su ect to most of the regulations.

The e ception is filing a form . This would not generally occur as purchasing scrap metal is a cash out transaction instead of a cash in transaction and, therefore, not a reporta le transaction. uspicious cti ity eport can e filed on any transaction, whether the company maintains dealer status or not.

DEFINITIONS

1

2

dealer n prec ous etals s defined as a person engaged within the United States as a business in the purchase and sale of covered goods and who, during the prior calendar or tax year: (i) urchased more than , in co ered goods and (ii) ecei ed more than , in gross proceeds from the sale of co ered goods. o, if you purchased scrap gold, as defined later within this article, in e cess of , , and sold at least that amount to a refiner, roker, or any other party, the trigger has been met (hammer time.)

For purposes of this section, the term “dealer” does not include: (i) retailer, unless the retailer, during the prior calendar or ta year, purchased more than , in co ered goods from persons other than dealers or other retailers (such as members of the general pu lic or foreign sources of supply or (ii) person licensed or authori ed under the laws of any State (or political subdivision thereof) to conduct business as a pawn roker, ut only to the e tent such person is engaged in pawn transactions including the sale of pawn loan collateral). ot including precious metal scrap purchases orry harlie

3 4

The terms purchase and sale do not include a retail transaction in which a retailer or a dealer accepts from a customer covered goods, the value of which the retailer or dealer credits to the account of the customer, and the retailer or dealer does not provide funds to the customer in exchange for such covered goods. o, if a pawn roker ga e the customer credit only perhaps towards other goods and ne er paid the customer ia check, wire, , or cash, there would e an e emption.

The terms “purchase” and “sale” do not include the purchase of jewels, precious metals, or precious stones that are incorporated into machinery or equipment to be used for industrial purposes, and the purchase and sale of such machinery or equipment. o, if you re uilding golden guns for a new , you re e empt

WHAT DEFINES COVERED GOODS?

recious metals and finished goods that deri e percent or more of their alue from ewels, precious metals, or precious stones contained in or attached to such finished goods again, as discussed earlier, must contain or more in purity. ncluded in this definition are . old, iridium, osmium, palladium, platinum, rhodium, ruthenium, or sil er, ha ing a le el of purity of percent in the aggregate would apply to the rule. . recious stones as part of the finished goods that are a su stance with gem uality market recogni ed eauty, rarity, and alue, and includes diamond, corundum including ru ies and sapphires , eryl including emeralds and a uamarines , chryso eryl, spinel, topa , ircon, tourmaline, garnet, crystalline and cryptocrystalline uart , oli ine peridot, tan anite, adeite ade, nephrite ade, spodumene, feldspar, tur uoise, lapis la uli, and opal. f the usiness meets the definition as a dealer in precious metals, it must implement . n anti money laundering program . risk assessment defining the risk the company creates as ongoing training . n independent re iew pro ision

WHAT’S NEW FOR DEALERS IN PRECIOUS METALS?

esides the fact that the regulation is now part of Title The atriot ct and that audits are on the rise, the regulation is in full force.

The rule has een in place since and has een widely enforced since .

OFAC

stands for ffice of oreign ssets ontrol. This federal agency regulates trade with certain countries, foreign companies, foreign anks, and foreign persons who are deemed a threat to the United States or that are involved with international narcotics trafficking. periodically pu lishes a list known as the list. stands for specifically designated nationals and locked entities.

(Continues on page 66)

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BUSINESS SENSE (From page 54)

Data = Trade Secrets COMMUNICATING

repare and disseminate the policy. ou could use your employee hand ook. eet with employees to emphasi e the importance of the policy and protecting confidential information. onsider confidentiality and proprietary rights agreements, or including such pro isions in employment agreements. esignate confidential information and sources and mark if appropriate.

WHATâ&#x20AC;&#x2122;S NEXT?

onsider implementing a trade secret program. fter you ha e a trade secret program in place consider pro iding a sample letter to your chief of police or sheriff descri ing you program. f you ha e an attorney who understands intellectual property and trade secret law, you may want to get consultation a out all of the foregoing.

COOPERATING WITH LAW ENFORCEMENT

ome confusion may e ist etween law enforcement and pawn roker licensees o er what information you must pro ide to law enforcement.

law enforcement agency may re uest information in a narrow in uiry such as as ohn oe or ary mith pawned anything in the past si months lease pro ide the names and personal info of any person who pledged a man s ole wrist watch in the past month. a e you taken in pawn any T sets in the past three weeks These would e considered accepta le and legitimate in uires as these re uests are fairly specific and narrow in scope. owe er, attempts to cast a wide net o er your pawn information where it has little or no legitimate in estigati e purpose poses uestions. amples might include hat are the names and or personal info of any person who has pawned a ring in the last si months i e me the names of all frican merican men who ha e pawned an item in the past two weeks.

The use of such a wide reaching uestion as these could ring the legitimacy of the in estigation into uestion. dditionally, e en in the case of legitimate in uires, one needs to e aware of how such information is pro ided.

(Continues on page 65)

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BUSINESS SENSE (Continued from page 27)

Eight Things Every Seller Should Know Oh, he competes in a different territory? These buyers won’t pay as much because the skill, expertise, processes, and methods of your company are less valuable to those already doing what you do. More often than not, the better (and lower risk) buyers are individuals, financial buyers, or companies in related or adjacent industries.

7

8

You need more than one good buyer. If you want to sell and you have just one buyer, who has whom? The business sale experience can be extremely frustrating if you just deal with one buyer at a time. The buyers will have all the leverage.

The key to getting a good deal done in a timely manner is to work all the qualified buyers simultaneously. Get all their offers around the same time and then you have choices, and leverage, and each buyer’s competitive instincts will kick in. Choose the best and if he stumbles, go right to the second best.

Buyers need not be coddled. Sure, you are a nice person, but you don’t have time to waste. You have a business to run.

You are either going to get a deal done, or keep the business and continue enjoying all the money it makes.

This is how you should run the process and the attitude you should show to prospective buyers.

Quiet is a PART of the plan, not THE plan. Confidentiality is important, but if you make it your number one consideration, you’ll never get anywhere.

The key to confidentiality is to move swiftly and get the deal done before the grapevine has the chance to do its thing. More particularly, don’t start the process (or talk to anyone) until: a. You’re sure it’s what you want b. You have a good estimate of what the market will bear (price and terms) and such is acceptable to you c. You have all the offering data ready and you have identified all the buyer candidates

Only then should you: a. Reveal your intentions only to buyers who have the motivation and money to really make the purchase. b. Introduce the opportunity to all the good buyer candidates simultaneously. c. Make sure each knows you’re serious about confidentiality and if they breach it, they’ll be eliminated as a buyer candidate. d. Run fast and get a deal closed in a timely manner.

Tell everyone that you have a great business but have some other things you might like to do. If you find the right buyer at the right price, you might take it. If not, you’ll keep the biz and enjoy it and the opportunity is off the table.

The intent of the above tips is to save the business seller time, money and frustration. If the time is not right, focus (Continued on page 67)

FALL 2012 | NATIONAL PAWNBROKERS ASSOCIATION | 61

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GOVERNMENT RELATIONS (Continued from page 6)

to contact your elected representatives in Washington. I also hope that you have urged your employees, relatives, friends, and neighbors to do so. If not, please do it now, as we could see action on a Federal Charter during the lame duck session of Congress.

The mega-provider proponents of this Federal Charter bill, with their fat checkbooks and troops of lobbyists, will keep pushing. We must push back.

MAKE IT PERSONAL We are always excited to hear that NPA members have visited their elected officials. t s not always easy to make the trip to ashington to meet with your em ers of ongress. on t forget you can contact them in state while they make the rounds in their congressional districts.

These personal visits by constituent pawnbrokers have a huge impact and pay dividends many times over. Inviting them on a tour of your store lets them really see what the pawn industry is all about.

Before you meet with them, call Matthew Church at the NPA office and he will make sure you ha e the most current talking points on the Federal Charter, as well as other issues facing the pawn industry.

WAKE UP CALL Hopefully, by now everyone gets the picture and embraces the Preserve, Protect and Defend concept from the first portion of this column.

It will take more than testifying at a Washington hearing and producing some well placed articles in anking and financial industry publications to stop a Federal Charter.

Just like Uncle Sam……WE NEED YOU!!

In late September, you received a WAKE UP CALL: Federal Charter notice by email urging you to help us, yourself, and all independent pawnbrokers by going to the NPA website, www.nationalpawnbrokers.org, and clicking on the Rally Congress link.

I hope you have already taken advantage of this easy mechanism

NPA LEGISLATIVE CONFERENCE t s ne er too early to talk a out our annual egislati e Conference in Washington, DC on April 16, 2013. e ll ha e new em ers of ongress to isit and lots of veteran Members that will require a refresher course in Pawn 101. They need to hear our story from YOU, the independent pawnbroker, not those other corporate guys that have never stood behind a pawn counter. can t emphasi e enough the importance of ha ing a huge turnout for this conference. on t let your oice go unheard.

For more information on the Legislative Conference, watch the we site, or contact atthew hurch, o ernment Relations Administrator, at matthew@NationalPawnbrokers.org or 817-337-8830.

On behalf of the NPA, I want to thank each of you for your continued support of our efforts and our Association. We wish you and yours a Happy Holiday Season and good health into the New Year.

Support NPA’s Political Action Committee EVERY CONTRIBUTION MAKES A DIFFERENCE

The National Pawnbrokers Association (NPA) Political Action Committee (PAC) provides financial support to elected officials who influence legislation affecting your business.

62 | NATIONAL PAWNBROKERS ASSOCIATION | FALL 2012

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- POWER RALLY CONGRESS: THE EASY WAY TO CONTACT YOUR MEMBERS OF CONGRESS http://act.nationalpawnbrokers.org The Rally Congress section of the NPA website will allow you to support NPA’s legislative efforts so that the pawn industry has a coordinated, united message to our Senators and Representatives.

Three easy steps!

1. Go o to the Rally Congress web page. Click on the red button that says “Take Action.”

Absolute Respect. It’s knowing you rule the air when you’ve got the best experience working for you.

And you do … with MID-STATES.

2. Review the letter that NPA has provided for you. Make changes if necessary, and enter your contact information.

3. Review your letter one last time. Click the red “Send Letters” button, away it goes!

Mid-States is one of the most recognized and highlyregarded names in refining today — with good reason.

Our most experienced sales and technical staff maintain the highest standards of honest, ethical practice with unparalleled customer service. With expert, in-house metal trading that lets you lock in your price at any time, we deliver the highest recoveries at the most competitive rates with complete financing and settlement flexibility.

Every day, for every melt, without compromise. Knowing you and your materials are in the best of hands ...

Go ahead, rule the air.

For Absolute Respect, Make It Mid-States.

You’re done!

800 551 0083

www.midstatesrecycling.com

FALL 2012 | NATIONAL PAWNBROKERS ASSOCIATION | 63

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COMMUNITY INVOLVEMENT

(Continued from page 39)

FBL Contributions Modell Collateral Loans

Ohio Loan Co.

Pawnmart Jewelry & Loan

Stebgo Metals

Money Tree Loans

Pacer

Pico Union Pawn Shop

Sumpter’s Jewelry & Collectables

Moore Pawn

Paradise Pawn Shop Inc.

Pike County Pawn Shop

Motor City Pawnbrokers

Paul Reiser and Associates

Pine Ridge Pawn & Jewelry

Mullins Pawn Shop

Pawn Depo

Platinum Jewelry & Loan

Naranja Trading Post & Pawn

Pawn King

Poplar Jewelry & Pawn

Nathan’s Lynnhaven Pawn Shop

Pawn King

Porter’s Pawn and Bargain Center

New York, NY

Sherwood, AR Lincoln, NE Warren, MI

Mount Airy, NC Naranja, FL

Virginia Beach, VA

National Pawnbrokers Outlet Waterford, MI

Dayton, OH

Little Rock, AR Melbourne, FL Green Bay, WI Holyoke, MA Arnold, MO

Springfield, IL

Pawn Market, Inc. Topeka, KS

Numis International

Pawn Max Inc.

NW Pawn & Collector Arms

Pawn USA

Oakridge Pawn Shop

Pawn$mart

Millbrae, CA

Spokane Valley, WA Albany, GA

Macon, GA

Rogers, AR

Lake Wales, FL

Norwalk, CA

Los Angeles, CA Waverly, OH Naples, FL

Lancaster, CA

Baltimore, MD

Mountain Home, AR

Premier Pawnbrokers Fallon, NV

Princess Anne Pawn Virginia Beach, VA

Provident Loan Society of NY New York, NY

Quick Cash Pawn Burlington, NC

Quick Cash Pawn & Jewelry Nashville, TN

R & R Pawn

Indianapolis, IN

R J Cash Enterprises Miami Gardens, FL

Rogers Jewelry Quincy, MA

Rose Pawn Rogers, AR

Royal Loan

San Diego, CA

Ruby Mountain Pawn Elko, NV

NPA INSIDER VIDEO Watch videos on the latest pawn news, trends, and hot-button topics. Hosted by communications expert Patricia Stark, the NPA INSIDER VIDEO NEWS CHANNEL delivers valuable pawn news, pawn expert tips, and industry information in a professional video format to your computer, smart phone, iPhone, or iPad. Log on to the Members Only area of the NPA website and check it out!

Sam Light Loan Company Saint Louis, MO

Sibley Road Pawn Shop Augusta, GA

Silver Dollar Pawn Exchange

South Saint Paul, MN

Charlotte, NC

Sunbelt Jewelry & Loan Houston, TX

Ted’s Pawn Shop Norwood, OH

The Cash Store Pawnshop Fairfax, VA

The Gold Mine Chelsea, MA

Tom’s Pawn & Wholesale Jewelry Murfreesboro, TN

Top Dollar Jewelry & Loan Co Albemarle, NC

UltraPawn Lombard, IL

Uncle Joe’s Pawn & Jewelry Weatherford, TX

Uncle Sam’s Loan Office Bristol, TN

Universal Pawn Alton, TX

Uptown Pawn

Minneapolis, MN

USA Jewelry & Pawn Saint Augustine, FL

USA Loans

Little Rock, AR

Waipahu Hawaii Pawn Honolulu, HI

We Lend More

National City, CA

Wellston Pawn

Warner Robins, GA

West Side Pawn Knoxville, TN

Wild Bill’s Jewelry & Pawn Columbus, GA

Meridian, MS

Wooden Indian Pawn Shop

Sparklez, LLC dba Gem Loanz

Zeidman’s Loan Office

Upper Saint Clair, PA

Defiance, OH Detroit, MI

64 | NATIONAL PAWNBROKERS ASSOCIATION | FALL 2012

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BUSINESS SENSE (From page 60)

Data = Trade Secrets ACCESS

You are not required to allow access to your computers or carte lanche entry into your files. or are you re uired to allow access to your safe, vault, back room, or any other secured area without a warrant or su poena. ou must, however, allow inspection of your records and pledges by the law enforcement agency under which you are super ised.

As a reminder, you should always cooperate fully with any law enforcement by providing any information they request in an open and acti e in estigation.

Most law enforcement personnel are truly appreciative of cooperation from our industry. nd we once again, strongly encourage such cooperation. This fosters a strong, lasting, and mutually eneficial relationship. or more information, please contact ou Tansky, resident, hio awn rokers ssociation at .

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FALL 2012 | NATIONAL PAWNBROKERS ASSOCIATION | 65

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FEATURE (Continued from page 59)

Boot Camp “U.S. persons” (both businesses and individuals) are prohibited from doing business with any person on the SDN list.

There are also countries (e.g., Cuba and Iran) and banks on the list, but these entities would not typically be involved with the average pawn business.

Prior to conducting business with any individual, you should check the most up-to-date SDN list. Use the OFAC page on the Treasury Department’s website, unless you subscribe to a service that helps you screen names against the OFAC SDN list.

Recently, OFAC added the ability to check the list on line. Go to http://sdnsearch.ofac.treas.gov/ to conduct a search, tax free.

If you conduct business with someone on the list, there are serious penalties. f property is taken in from a confirmed person on the list, the business is not allowed to return that property to the person.

It’s not your lucky day if the person you’re seizing funds or property from was a star on the last ultimate fighter show. t that point, it might be a good time to call the local police to intervene.

You must report a transaction to OFAC if it is with someone whose name and identifying details (country of birth, or domicile and date of birth) match a name on the SDN list.

You will not be penalized if you do business with a person whose name’s spelling is close to a person on the SDN list, or whose name is the same, but whose birth date or country of domicile is different.

If it is suspected that a person is on the list, OFAC should be contacted at to confirm this fact. The likelihood of getting a hit on your customer is probably as likely as someone walking into your pawn shop with the Koh-i-Noor diamond, but conducting the transaction without erification could lead to major negative consequences.

RED FLAGS RULE

The Red Flags Rule is enforced by the Federal Trade ommission. ertain financial institutions and creditors are required to comply. The FTC guidelines say that, if you deal with covered accounts in general, you will be required to comply. As a pawn broker, you’re required to comply. In order to comply, you must have written policies and procedures in place (Written Program.)

Your Written Program must include reasonable policies and procedures to identify any identity theft red ags that you may run across in the day-to-day operation of your business. Red ags include suspicious patterns or practices or specific acti ities that indicate the possibility of identity theft.

For example, if a customer has to provide some form of identification to open an account with your company, and the identification looks like it might e fake, it would e a red ag for your business. our program must e designed to detect the red ags you e identified. or e ample, if you e identified fake identification as a red ag, you must ha e procedures in place to detect possi le fake, forged, or altered identification.

Your program must spell out the appropriate actions to be taken when you detect red ags. inally, ecause identity theft

is an ever-changing threat, you must address how you will reevaluate your program periodically to detect new risks.

Some of the questions that need to be answered in your program include: hat type of transactions do you perform ow do you share the data ow do you secure the data ow do you destroy the data ow do you recogni e red ags ow do you pre ent identity theft The rules are now in effect and companies that fail to comply not only open themsel es up to large ci il fines from identity theft litigation, ut also su ect themsel es to T fines for noncompliance.

TILA

TILA stands for the Truth in Lending Act. The FDIC enforces this law, which is covered under parts of the Consumer Credit Protection Act and Regulation Z. Its purpose is to make sure that the type and terms of transactions are disclosed in full and that consumers understand them.

We are all aware that consumers rarely read the disclosure but, whether they read it or not, your company must provide the document. In brief, you must disclose the APR, amount financed, amount due, total num er of payments due, and dollar amount the credit will cost the consumer. You must also disclose any fees or application charges as part of the APR. The agreement must define whether or not the transaction carries a pre-payment penalty, right of recession, and other items. All of the major elements must be in at least 12-point font.

The APR must be within 1/8 of 1% to be considered valid disclosure of the you re charging. There must e specific boxes for these items. Fail to dot an “i” or cross a “t” and you’re in deep s*** (stew).

Fines can be excessive and lawyers will come after you like vultures to a dead carcass. (No! Lawyers are not bird looking ominous creatures riminal charges may also e filed for willfully deceiving the public through the disclosures (understating the APR.) Fines can include everything from having to pay back the amount that was overstated, to not having the loan paid back at all.

FINAL WORDS

There you have it! We have covered form 8300 regulations, dealers in precious metals, , red ags, and T .

Failure to follow any of these regulations can lead to serious fines and the need to purchase a lot of antacids.

So, hunker down, spend some time and learn the rules and you will be ready to do business in 2013. Feel free to reach out to the National Pawnbrokers Association for guidance.

Robert Frimet is President of RMF Consulting Group, Inc. and is a Certified Anti-Money Laundering Specialist (CAMS) serving the pawn, check cashing, payday, title, and other industries since 1991.

Mr. Frimet offers compliance services nationwide and may be reached at 866-204-7209 or at Bob@checkconsultants.com.

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BUSINESS SENSE (Continued from page 61)

Eight Things Every Seller Should Know your energy on growing the business and posting solid performance, then enter the market.

When you do, keep in mind that selling a business is a sales activity. Itâ&#x20AC;&#x2122;s not a passive process. Itâ&#x20AC;&#x2122;s proactive.

Doing it right takes a lot of time and energy. It requires some urgency. Even though it is done discretely, selling a business successfully requires the same elements as any successful sale: preparation, presentation, representation and negotiation.

This content is intended to provide general information on the subject matters covered. It is distributed with the understanding that neither the publisher nor any distributor or advertiser is engaged in providing legal, tax, insurance, investment or other professional advice.

The advice of a qualified professional should be sought before any reader applies a concept presented herein to his or her particular situation or business.

NPA STAFF Office PO Box 508 Keller, TX 76244 Phone: (817) 337-8830 Fax: (817) 337-8875 www.nationalpawnbrokers.org 891 Keller Pkwy, Suite 220 Keller, TX 76248 Dana Meinecke Executive Director dana@nationalpawnbrokers.org Margie Swoyer Director of Membership margie@nationalpawnbrokers.org

CALENDAR OF EVENTS

04/2013

NPA LEGISLATIVE CONFERENCE

APRIL 16, 2013 Hamilton Crowne Plaza Washington, D.C. Contact: Matthew Church, matthew@nationalpawnbrokers.org

DIXIE PAWNBROKERS EDUCATIONAL CONFERENCE AND TRADE SHOW

APRIL 19-21, 2013 Hilton New Orleans Riverside New Orleans, LA Contact: Rob Barnett, (256) 534-1000

05/2013

MIDWEST CONVENTION

MAY 17-19, 2013 The Galt House Hotel Louisville, KY Contact:Ron Stempkowsk, liap@comcast.net

07/2013

PAWN EXPO 2013

JULY 16-18, 2013 The Cosmopolitan of Las Vegas Contact: Lindsay Wilson, lindsay@nationalpawnbrokers.org

Lindsay Wilson Director of Meetings and Events lindsay@nationalpawnbrokers.org Chris Pearcey Communications Specialist chris@nationalpawnbrokers.org Matthew Church Government Relations Administrator matthew@nationalpawnbrokers.org Terri Congleton Administrative Assistant terri@nationalpawnbrokers.org

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Index of Advertisers ADVERTISER Aaria

Page 25

(248) 961-0506 www.AriaDiamonds.com

ABC Diamond Buyer

50

13

60

Gesswein

44

15

51

(800) 421-7250 www.gia.edu

Golden Opportunities

58

(888) 387-6017 www.GoldenOppUSA.com 10

HallmarkResearch.com Back Cover

Hi-Tech Precious Metals & Refinery 65

(800) 531-5234 www.BurrellPrinting.com

ADVERTISER North American Metals

34

(866) 950-7528 www.HiTechPMR.com

International Gemological Institute

NTR Metals

Palak Diam

Pawnshop Consulting Group Peer Focus Groups

Rapaport

Rolland Safe

Manhattan Gold & Silver 7

Data Age/PawnMaster

Mason-Kay 44

(888) 949-7296 PawnMaster.com/npbm

Dillon Gage (888) 436-3489 www.dillongage.com

Garfield Refining (800) 523-0968 www.GarfieldRefining.com

55

56

(888) 657-8665 NationalJewelersSupplies.com

40

5

(866) 337-7464 www.thetrendz.biz 10

United Precious Metals

26

(800) 999-3463 www.UnitedPMR.com 63

(800) 551-0083 www.midstatesrecycling.com

National Jewelers Supplies

11

(337) 262-7700 www.stuller.com

The Trendz

(800) 722-7575 www.masonkay.com

Mid-States Recycling & Refining 19

Stuller

(212) 398-1454 www.mgsrefining.com/npa

3

stallcupgroup.com

Cash America

55

53

(800) 225-2984 www.rslc.net

Stallcup Group Inside Front Cover

21

(866) 204-7209 www.checkcashingcompliance.com

(800) 476-2715 www.Livesaysinc.com

(866) 545-9868 www.CompuPawn.com

9

(212) 354-9800 www.rapaportauctions.com

Livesayâ&#x20AC;&#x2122;s

CompuPawn

57

(954) 540-3697 www.pawnsymposium.com

(800) 289-0138 www.stebgo.com

61

37

(213) 228-0077 www.PalakDiam.com

Stebgo Metals

(866) 291-8110 pawnshopbuyer.com

23

(800) 889-0396 NTRMETALS.com

(562) 945-7276 www.TheBuyers.com

65

32

(800) 773-1626 www.NorthAmericanMetals.com

www.igionline.com

The Buyers

Page

RMF Consulting Group Hallmark Research Institute

(888) 800-BLUE (2583) www.Bluestone-Trading.com

Burrell Printing

53

Gemological Institute of America

(732) 696.8556 www.bluegroundtrading.com

Bluestone Trading

Geib Refining

65

(800) 530-2647 www.amipi.com

Blue Ground Trading

46

(203) 365-5400 www.gesswein.com

(800) 391-0012 www.altadiamonds.net

Amipi

Garrett Metal Detectors

(800) 228-4653 www.GeibRefining.com

(212) 391-6637 alexgtoldrefinery.com

Alta Diamonds

Page

(800) 527-4011 www.Garrett.com

(586) 354-7274 www.ABCDiamondBuyer.com

Alex Gold & Diamonds

ADVERTISER

Wexler Insurance Agency

Inside Back Cover

(800) 432-1853 www.WexlerInsurance.com 55

White Pine

29

(646) 758-0292 whitepinediamonds.com

The NPA does not specifically endorse any entity and makes no representations, warranties or guarantees, and assumes no responsibility for, the products or services provided by these entities. The NPA expressly disclaims all liability for damages of any kind arising from the use or the performance of the products or services provided by these entities 68 | NATIONAL PAWNBROKERS ASSOCIATION | FALL 2012

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