Bill Text: TX SB1450 | 2011-2012 | 82nd Legislature | Engrossed
Bill Title: Relating to the regulation of crafted precious metal dealers and dealerships; providing a criminal penalty.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Engrossed - Dead) 2011-05-20 - Reported favorably as substituted [SB1450 Detail]
Download: Texas-2011-SB1450-Engrossed.html
By: Zaffirini | S.B. No. 1450 |
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relating to the regulation of crafted precious metal dealers and | ||
dealerships; providing a criminal penalty. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Subchapter B, Chapter 1956, Occupations Code, is | ||
amended by adding Section 1956.0605 to read as follows: | ||
Sec. 1956.0605. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED | ||
BY CERTAIN CRAFTED PRECIOUS METAL DEALERS. This subchapter does | ||
not apply to: | ||
(1) a person that is required to hold a dealership | ||
license under Subchapter B-1; or | ||
(2) crafted precious metal acquired by a person | ||
described by Subdivision (1). | ||
SECTION 2. Chapter 1956, Occupations Code, is amended by | ||
adding Subchapter B-1 to read as follows: | ||
SUBCHAPTER B-1. SALE OF CRAFTED PRECIOUS METAL TO DEALERS AND | ||
DEALERSHIPS IN CERTAIN MUNICIPALITIES | ||
Sec. 1956.071. DEFINITIONS. In this subchapter: | ||
(1) "Commission" means the Texas Commission of | ||
Licensing and Regulation. | ||
(2) "Crafted precious metal" means jewelry, | ||
silverware, an art object, a bar, a coin, a commemorative | ||
medallion, or another object, including scrap or a broken item, | ||
made in whole or in part from precious metal. | ||
(3) "Dealer" means a person who engages in the | ||
business of purchasing and selling crafted precious metal. | ||
(4) "Dealership" means a location at which or premises | ||
in which a dealer conducts business. | ||
(5) "Department" means the Texas Department of | ||
Licensing and Regulation. | ||
(6) "Precious metal" means gold, silver, platinum, | ||
palladium, iridium, rhodium, osmium, ruthenium, or an alloy of | ||
those metals. | ||
Sec. 1956.072. APPLICABILITY OF SUBCHAPTER. This | ||
subchapter applies only to: | ||
(1) a person that engages in business in a | ||
municipality: | ||
(A) with a population of 200,000 or more; and | ||
(B) located in a county: | ||
(i) with a population of 300,000 or less; | ||
and | ||
(ii) that is located adjacent to an | ||
international border; and | ||
(2) crafted precious metal that is: | ||
(A) sold or used primarily for personal, family, | ||
or household purposes; and | ||
(B) acquired by a person described by Subdivision | ||
(1) for sale. | ||
Sec. 1956.073. EXCEPTION: PRECIOUS METAL EXTRACTED, | ||
RECOVERED, OR SALVAGED FROM INDUSTRIAL BY-PRODUCTS OR INDUSTRIAL | ||
WASTE PRODUCTS. This subchapter does not apply to a person whose | ||
purchase or sale of precious metal or a product made of precious | ||
metal is merely incidental to the person's business of extracting, | ||
recovering, or salvaging precious metal from industrial | ||
by-products or industrial waste products. | ||
Sec. 1956.074. EXCEPTION: DENTAL, PHARMACEUTICAL, OR | ||
MEDICAL APPLICATION OF CRAFTED PRECIOUS METAL. This subchapter | ||
does not apply to a dental, pharmaceutical, or medical application | ||
of crafted precious metal. | ||
Sec. 1956.075. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED | ||
FROM ANOTHER DEALER WHO PREVIOUSLY MADE REQUIRED REPORTS. This | ||
subchapter does not apply to crafted precious metal acquired in | ||
good faith in a transaction involving the stock-in-trade of another | ||
dealer who previously made the reports concerning that metal as | ||
required by this subchapter if: | ||
(1) the selling dealer delivers to the acquiring | ||
dealer a written document stating that the reports have been made; | ||
(2) the acquiring dealer submits a copy of the | ||
statement to the chief of police of the municipality or the sheriff | ||
of the county in which the selling dealer is located; and | ||
(3) each dealer involved in the transaction retains a | ||
copy of the statement until the third anniversary of the date of the | ||
transaction. | ||
Sec. 1956.076. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED | ||
IN DISSOLUTION OR LIQUIDATION SALE. This subchapter does not apply | ||
to crafted precious metal acquired in a nonjudicial sale, transfer, | ||
assignment, assignment for the benefit of creditors, or consignment | ||
of the assets or stock-in-trade, in bulk, or a substantial part of | ||
those assets, of an industrial or commercial enterprise, other than | ||
a dealer, for the voluntary dissolution or liquidation of the | ||
seller's business, or for disposing of an excessive quantity of | ||
personal property, or property that has been acquired in a | ||
nonjudicial sale or transfer from an owner other than a dealer, the | ||
seller's entire household of personal property, or a substantial | ||
part of that property, if the dealer: | ||
(1) gives written notice to the chief of police of the | ||
municipality or the sheriff of the county in which the dealer's | ||
business is located that a reporting exemption is being claimed | ||
under this section; | ||
(2) retains in the dealer's place of business, until | ||
the third anniversary of the date of the transaction, a copy of the | ||
bill of sale, receipt, inventory list, or other transfer document; | ||
and | ||
(3) makes the record retained available for inspection | ||
by a peace officer. | ||
Sec. 1956.077. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED | ||
IN JUDICIAL SALE. This subchapter does not apply to crafted | ||
precious metal acquired in a sale made: | ||
(1) by any public officer in the officer's official | ||
capacity as a trustee in bankruptcy, executor, administrator, | ||
receiver, or public official acting under judicial process or | ||
authority; or | ||
(2) on the execution of, or by virtue of, any process | ||
issued by a court. | ||
Sec. 1956.078. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED | ||
AS PAYMENT FOR OTHER CRAFTED PRECIOUS METAL BY PERSON IN BUSINESS OF | ||
SELLING TO CONSUMERS. This subchapter does not apply to crafted | ||
precious metal acquired in good faith as partial or complete | ||
payment for other crafted precious metal by a person whose | ||
principal business is primarily that of selling directly to the | ||
consumer crafted precious metal that has not been subject to a prior | ||
sale. | ||
Sec. 1956.079. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED | ||
FROM OR REPORTED TO GOVERNMENTAL AGENCY. This subchapter does not | ||
apply to crafted precious metal: | ||
(1) acquired as surplus property from the United | ||
States, a state, a subdivision of a state, or a municipal | ||
corporation; or | ||
(2) reported by a dealer as an acquisition or a | ||
purchase, or reported as destroyed or otherwise disposed of, to: | ||
(A) a state agency under another law of this | ||
state; or | ||
(B) a municipal or county office or agency under | ||
another law of this state or a municipal ordinance. | ||
Sec. 1956.080. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED | ||
BY PERSON LICENSED UNDER TEXAS PAWNSHOP ACT. This subchapter does | ||
not apply to crafted precious metal acquired by a person licensed | ||
under Chapter 371, Finance Code. | ||
Sec. 1956.081. EFFECT ON OTHER LAWS AND ORDINANCES. This | ||
subchapter does not: | ||
(1) excuse noncompliance with another state law or | ||
municipal ordinance covering the reporting, holding, or releasing | ||
of crafted precious metal; | ||
(2) prohibit a municipality from enacting, amending, | ||
or enforcing an ordinance relating to a dealer; or | ||
(3) supersede a municipal ordinance except to the | ||
extent the ordinance does not require reporting for transactions | ||
involving crafted precious metal. | ||
Sec. 1956.082. RULEMAKING. The commission may adopt rules | ||
necessary to implement and enforce this subchapter. | ||
Sec. 1956.083. DEALERSHIP LICENSE REQUIRED. A person may | ||
not engage in business as a crafted precious metal dealer unless the | ||
person holds a dealership license. | ||
Sec. 1956.084. MULTIPLE PLACES OF BUSINESS. (a) A | ||
separate dealership license is required for each place of business | ||
operated under this subchapter. | ||
(b) The department may issue more than one dealership | ||
license to a person if the person complies with this subchapter for | ||
each license. | ||
Sec. 1956.085. APPLICATION REQUIREMENTS. (a) An | ||
application for a dealership license must be made to the department | ||
and must: | ||
(1) be under oath; | ||
(2) state: | ||
(A) the full name and address of the applicant; | ||
(B) the type of business entity formed by the | ||
applicant, if the applicant is not an individual; | ||
(C) the full name and address of each general | ||
partner and the type of partnership, if the applicant is a | ||
partnership; | ||
(D) the full name and address of each officer and | ||
owner, if the applicant is an unincorporated association; | ||
(E) except as provided by Subsection (b), the | ||
full name of each officer and shareholder, if the applicant is a | ||
corporation; | ||
(F) the full name and address of each manager and | ||
operator of the dealership; | ||
(G) the location where the dealership's business | ||
is to be conducted and a copy of the certificate of occupancy for | ||
the location; | ||
(H) the intended hours of operation of the | ||
dealership; and | ||
(I) other relevant information required by the | ||
department; and | ||
(3) state that the applicant and, if applicable, any | ||
business partner or officer of the corporation has not had a license | ||
revoked under this subchapter or Chapter 371, Finance Code. | ||
(b) The full name of each shareholder is not required if the | ||
applicant is a corporation with five or more shareholders. | ||
Sec. 1956.086. FEES. (a) Except as provided by Subsection | ||
(b), an applicant must submit with the application: | ||
(1) an application fee of: | ||
(A) $500, if the applicant does not hold a | ||
license under this subchapter; or | ||
(B) $200, if the application is for an additional | ||
dealership license for a separate location; and | ||
(2) an annual license fee in an amount determined by | ||
the commission by rule. | ||
(b) An applicant that is exempt from taxation under Section | ||
501(c)(3), Internal Revenue Code of 1986, is exempt from the fees | ||
required under Subsection (a). | ||
Sec. 1956.087. LICENSE TERM; RENEWAL. A license expires on | ||
the first anniversary of the date of issuance and may be renewed | ||
annually on payment of the required annual license fee. | ||
Sec. 1956.088. INVESTIGATION; NOTICE OF APPLICATION. | ||
(a) On receipt of an application and the required fees, the | ||
department shall: | ||
(1) conduct an investigation to determine whether to | ||
issue the license; and | ||
(2) give notice of the application to: | ||
(A) the Department of Public Safety; and | ||
(B) each local law enforcement agency in the | ||
county in which the dealership is to conduct business. | ||
(b) The notice under Subsection (a) must state the name and | ||
address of each person required by Section 1956.085 to be listed on | ||
the license application. | ||
(c) The department shall give the Department of Public | ||
Safety and local law enforcement agencies a reasonable period to | ||
respond to the notice with information concerning the listed | ||
persons or any other relevant information. | ||
Sec. 1956.089. NOTICE OF DENIAL; HEARING. (a) If the | ||
department determines not to issue a license, the department shall | ||
deliver to the applicant at the address provided in the application | ||
a written notice by personal delivery or certified mail, return | ||
receipt requested. The notice must include the department's reason | ||
for denying the license. | ||
(b) Not later than the 30th day after the date of receipt of | ||
a notice under Subsection (a), an applicant may request a hearing on | ||
the application denial. The department shall set the hearing not | ||
later than the 60th day after the date of the request. A hearing | ||
under this section is subject to Section 51.354. | ||
(c) If the department denies the application, the | ||
department shall retain the application fee and shall return to the | ||
applicant the annual license fee submitted with the application. | ||
Sec. 1956.090. CONTENTS AND DISPLAY OF LICENSE. (a) A | ||
license must state: | ||
(1) the name of the dealer; | ||
(2) the address at which the dealership conducts | ||
business; and | ||
(3) that the dealership is authorized to deal in | ||
crafted precious metals. | ||
(b) A dealer shall display a license in a conspicuous | ||
location at the place of business provided on the license. | ||
Sec. 1956.091. APPLICATION FOR RELOCATION. A dealer who | ||
wishes to move a dealership from the location authorized by a | ||
license must file a relocation application with the department not | ||
later than the 30th day before the date the dealer moves and pay an | ||
application fee of $20. | ||
Sec. 1956.092. CRIMINAL BACKGROUND CHECK REQUIRED. (a) A | ||
dealer shall conduct a criminal background check on an applicant | ||
for employment with the dealer. | ||
(b) A dealer may not employ a person who has been convicted | ||
of an offense under Section 31.03, Penal Code. | ||
Sec. 1956.093. REPORT OF PURCHASE OR EXCHANGE REQUIRED. | ||
(a) A dealer shall, as required by Section 1956.094, report all | ||
identifiable crafted precious metal that the dealer purchases, | ||
takes in trade, accepts for sale on consignment, or accepts for | ||
auction. | ||
(b) Before crafted precious metal is offered for sale or | ||
exchange, a dealer must notify each person intending to sell or | ||
exchange the metal that, before the dealer may accept any of the | ||
person's property, the person must file with the dealer a list | ||
describing all of the person's crafted precious metal to be | ||
accepted by the dealer. The list must contain: | ||
(1) the proposed seller's or transferor's name and | ||
address; | ||
(2) the date and time of the purchase or exchange; | ||
(3) a complete and accurate description of the crafted | ||
precious metal, including: | ||
(A) a serial number, if available; and | ||
(B) the size, weight, material, length, number of | ||
items, capacity, or other identifying characteristics; and | ||
(4) the proposed seller's or transferor's | ||
certification that the information is true and complete. | ||
(c) The dealer shall record the proposed seller's or | ||
transferor's driver's license number or Department of Public Safety | ||
personal identification certificate number on physical | ||
presentation of the license or personal identification certificate | ||
by the seller or transferor. The record must accompany the list. | ||
(d) All lists and records required by this section must be | ||
legible. | ||
(e) The dealer shall: | ||
(1) provide to a peace officer or the department, on | ||
demand, the list required by Subsection (b); and | ||
(2) mail or deliver a complete copy of the list to the | ||
chief of police or the sheriff as provided by Section 1956.094 not | ||
later than 48 hours after the list is filed with the dealer. | ||
Sec. 1956.094. FORM OF REPORT; FILING. (a) A report | ||
required by this subchapter must comply with this section unless a | ||
similar report is required by another state law or a municipal | ||
ordinance, in which event the required report must comply with the | ||
applicable law or ordinance. | ||
(b) If a transaction regulated by this subchapter occurs in | ||
a municipality that maintains a police department, the original and | ||
a copy of the report required by this subchapter shall be submitted | ||
to the municipality's chief of police. If the transaction does not | ||
occur in such a municipality, the original and a copy of the report | ||
shall be submitted to the sheriff of the county in which the | ||
transaction occurs. | ||
(c) The dealer shall submit the report on a form prescribed | ||
by the district attorney or person performing the duties of | ||
district attorney of the county in which the transaction occurs. | ||
(d) The dealer shall retain a copy of the report until the | ||
third anniversary of the date the report is filed. | ||
Sec. 1956.095. RECEIPT REQUIRED. (a) A dealer, at the | ||
time of the sale or exchange of crafted precious metal, shall | ||
deliver a receipt to the seller or transferor. Each receipt | ||
delivered by the dealer must: | ||
(1) be numbered sequentially; | ||
(2) contain the date of the transaction or | ||
acquisition; and | ||
(3) itemize the crafted precious metal purchased or | ||
exchanged. | ||
(b) An accurate copy or record of the receipt shall be: | ||
(1) maintained until the third anniversary of the date | ||
of the sale or exchange; and | ||
(2) available on request for inspection during | ||
business hours by a peace officer or the department. | ||
Sec. 1956.096. REQUIRED RETENTION OF CRAFTED PRECIOUS | ||
METAL. (a) A dealer may not melt, deface, alter, or dispose of | ||
crafted precious metal that is the subject of a report required by | ||
this subchapter before the 22nd day after the date the report is | ||
filed unless: | ||
(1) the peace officer to whom the report is submitted, | ||
for good cause, authorizes disposition of the metal; or | ||
(2) the dealer is a pawnbroker and the disposition is | ||
the redemption of pledged property by the pledgor. | ||
(b) During the hold period required by Subsection (a), the | ||
crafted precious metal shall be stored or displayed: | ||
(1) in the exact form received; | ||
(2) in a manner as to be identifiable from the | ||
description provided under Section 1956.093; and | ||
(3) in a manner as to not impede or prevent the crafted | ||
precious metal's examination by a peace officer or the department. | ||
Sec. 1956.0965. STOLEN CRAFTED PRECIOUS METAL. (a) A | ||
dealer or an agent or employee of a dealership shall: | ||
(1) monitor the purchase of crafted precious metal to | ||
identify or prevent transactions involving stolen crafted precious | ||
metal; | ||
(2) make reasonable efforts to avoid accepting or | ||
purchasing stolen crafted precious metal; and | ||
(3) immediately report to a local law enforcement | ||
agency: | ||
(A) an offer to sell to the dealership crafted | ||
precious metal actually known or reasonably suspected to be stolen; | ||
(B) the identity, if known, and the description | ||
of the person offering to sell the metal described by Paragraph (A); | ||
and | ||
(C) the purchase of crafted precious metal | ||
subsequently determined or reasonably suspected to be stolen. | ||
(b) A dealer shall cooperate with a local law enforcement | ||
agency regarding any matter relating to stolen crafted precious | ||
metal and assist in the prompt resolution of an official | ||
investigation. | ||
Sec. 1956.0966. INSPECTION OF CRAFTED PRECIOUS METAL. | ||
(a) A dealer shall make crafted precious metal purchased by the | ||
dealer available for inspection by a peace officer or the | ||
department during regular business hours while in the dealer's | ||
possession. | ||
(b) Information obtained under this section is confidential | ||
except for use in a criminal investigation or prosecution or a civil | ||
court proceeding. | ||
Sec. 1956.0967. PURCHASE FROM MINOR. (a) A dealer may not | ||
purchase crafted precious metal from a person younger than 18 years | ||
of age unless the seller delivers to the dealer before the purchase | ||
a written statement from the seller's parent or legal guardian | ||
consenting to the transaction. | ||
(b) The dealer shall retain the statement with the records | ||
required to be kept under this subchapter. The dealer may destroy | ||
the statement after the later of: | ||
(1) the date the item is sold; or | ||
(2) the first anniversary of the date the dealer | ||
purchased the item. | ||
Sec. 1956.097. PURCHASE AT TEMPORARY LOCATION OF DEALER. | ||
(a) A dealer who conducts business at a temporary location for a | ||
period of less than 90 days may not engage in the business of buying | ||
precious metal or used items made of precious metal unless, within a | ||
12-month period at least 30 days before the date on which each | ||
purchase is made, the person has filed: | ||
(1) a registration statement with the department; and | ||
(2) a copy of the registration statement with the | ||
local law enforcement agency of: | ||
(A) the municipality in which the temporary | ||
location is located; or | ||
(B) if the temporary location is not located in a | ||
municipality, the county in which the temporary location is | ||
located. | ||
(b) The registration statement must contain: | ||
(1) the name and address of the dealer; | ||
(2) the location where business is to be conducted; | ||
(3) if the dealer is an association, the name and | ||
address of each member of the association; | ||
(4) if the dealer is a corporation, the name and | ||
address of each officer and director of the corporation; and | ||
(5) other relevant information required by the | ||
department. | ||
Sec. 1956.098. PURCHASE OF MELTED ITEMS. A dealer, in the | ||
course of business, may not purchase from a person other than a | ||
manufacturer of or a regular dealer in crafted precious metal an | ||
object formed as the result of the melting of crafted precious | ||
metal. | ||
Sec. 1956.0985. GROUNDS FOR DENIAL, REVOCATION, OR | ||
SUSPENSION OF LICENSE. The department may deny, revoke, or suspend | ||
a dealership license if the dealer: | ||
(1) violates this subchapter or a rule adopted or an | ||
order issued under this subchapter; | ||
(2) falsifies information on a license application; or | ||
(3) is convicted of an offense under Section 31.03, | ||
37.09, or 37.10, Penal Code. | ||
Sec. 1956.0986. NOTICE OF HEARING. (a) The department | ||
shall send written notice to the dealer of a dealership license | ||
revocation or suspension hearing that includes the cause or | ||
allegations of the revocation or suspension hearing. | ||
(b) A hearing under this section is subject to Subchapter G, | ||
Chapter 51. | ||
Sec. 1956.099. CRIMINAL PENALTY. (a) A person commits an | ||
offense if the person violates this subchapter. | ||
(b) An offense under this section is a Class B misdemeanor. | ||
SECTION 3. Section 215.031, Local Government Code, is | ||
amended to read as follows: | ||
Sec. 215.031. HAWKERS; PEDDLERS; PAWNBROKERS; CRAFTED | ||
PRECIOUS METAL DEALERS. The governing body of the municipality may | ||
license, tax, suppress, prevent, or otherwise regulate: | ||
(1) hawkers; | ||
(2) peddlers; [ |
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(3) pawnbrokers; and | ||
(4) crafted precious metal dealers licensed under | ||
Subchapter B-1, Chapter 1956, Occupations Code. | ||
SECTION 4. (a) As soon as practicable after the effective | ||
date of this Act, the Texas Commission of Licensing and Regulation | ||
shall adopt the rules and procedures necessary to implement | ||
Subchapter B-1, Chapter 1956, Occupations Code, as added by this | ||
Act. | ||
(b) A crafted precious metal dealer is not required to hold | ||
a license under Subchapter B-1, Chapter 1956, Occupations Code, as | ||
added by this Act, before March 1, 2012. | ||
(c) Subsection (a), Section 1956.096, Occupations Code, as | ||
added by this Act, applies only to crafted precious metal that is | ||
the subject of a report filed on or after the effective date of this | ||
Act. Crafted precious metal that is the subject of a report filed | ||
before the effective date of this Act is governed by the law in | ||
effect when the report was filed, and the former law is continued in | ||
effect for that purpose. | ||
(d) Section 1956.099, Occupations Code, as added by this | ||
Act, applies only to an offense committed on or after the effective | ||
date of this Act. An offense committed before the effective date of | ||
this Act is governed by the law in effect on the date the offense was | ||
committed, and the former law is continued in effect for that | ||
purpose. For purposes of this subsection, an offense was committed | ||
before the effective date of this Act if any element of the offense | ||
occurred before that date. | ||
SECTION 5. This Act takes effect September 1, 2011. |