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�� Frequently Asked Questions What type of inerchandise do pawn shops take in? Pawnbrokers buy or lend money on any item of value. Typical items include gold, jewelry, musical instruments, consumer electronics, tools, and household items. What is required to get a loan? In addition to disclosing terms of the loan, required by the federal Truth in Lending Act, state and local laws require additional information. In Minnesota and the majority of states, this includes: 1. Name and address 2. Customer's date of birth 3. Gender and ethnicity of customer 4. Government-issued form of personal identification 5. The date and time of the transaction 6. A description of the collateral, with serial number if available How do pawn shops prevent taking in stolen merchandise? All pawn shops have systems, reporting and training that nearly eliminates the receiving of stolen items. On a dai�y basis in Minnesota as well as most other states, pawn shops provide police with an encrypted, detailed electronic report containing detailed information on all merchandise taken. This data is then matched against databases to identify potentially stolen merchandise. When found, stolen property is confiscated by police and returned to its rightful owner. Pawnbrokers are trained to look for signs of stolen property to avoid these costly mistakes. These confiscations result in a direct loss of loaned funds and collateral by the business. In addition to reporting to police on a daily basis, as required by law, all items taken in are held for some period of time (typically 30 to 90 days) to allow the police to check their records. Anyone who sells, trades, or pawns any item must show a valid government issued picture ID (Driver's License, State Issued ID, Military ID, etc) in order to complete their transactions. This is a major deterrent as criminals do not wish to identify themselves. What types of regulation and compliance apply to pawn shops? Pawnbrokers are governed by all of the major laws that apply to other entities designated as "financial institutions" under federal law. These laws include: • The USA Patriot Act • The Bank Secrecy Act • IRS regulations on reporting of certain cash transactions • The Trading with the Enemy Act • The Gramm-Leach-Bliley Financial Services Modernization Act • The Truth-in-Lending Act Pawnbrokers take their federal compliance responsibilities seriously. National Pawnbrokers Association (NPA) Members receive training and other resources that outline how to comply with federal currency transaction and suspicious activity reporting requirements and with Treasury's Office of Foreign Assets Control regulations. Pawn loans are the only type of customer-credit transaction in which every transaction is reported to local law enforcement agencies. This is true in every state. Transactional reports --, ..�