SB 645

This bill allows pawnbrokers to send certain notices by electronic mail and text

message.

Under current law, pawnbrokers receive security for loans to customers by

taking possession of the customer's personal property. If the customer defaults on

the loan, the pawnbroker may sell the personal property, subject to certain

conditions. At least 30 days before selling the personal property, the pawnbroker

must send to the customer, by registered mail, a notice of the contemplated sale,

which notice must also state the amount due on the loan. If the sale is completed and

results in a surplus, the pawnbroker must send to the customer, by registered mail,

notice of the surplus from the sale. These provisions, however, do not apply if the

pawnbroker is a “licensed lender," which is a lender, other than a financial

institution, licensed by the Department of Financial Institutions to assess a greater

than 18 percent finance charge for a consumer loan.

This bill allows pawnbrokers to send notices of sale and notices of surplus by

registered mail or other means authorized under DFI's rules, and the bill further

modifies DFI's rules related to pawnbroker notices to allow a pawnbroker to provide

notice by electronic mail or text message if certain requirements are met. Under the

bill, a pawnbroker may send notice to a physical mailing address, or the pawnbroker

may send notice by electronic mail or text message if all of the following apply: 1) the

pawnbroker receives the customer's written consent to receive notices by electronic

mail or text message, which consent must state that the customer has the right to

withdraw the consent and must be signed by the customer, except that no separate

signature is required if the pawnbroker receives authorization by electronic mail or

text message from the customer's electronic mail address or telephone number; 2) the

pawnbroker requires at the time of the consent that the customer verify, using a

specified method, the customer's electronic mail address or telephone number; 3) the

pawnbroker retains records of the electronic mail or text message notices sent; and

4) the pawnbroker sends notice to the customer's physical mailing address if the

electronic mail or text message delivery fails or if the customer withdraws consent

to receive notice by electronic mail or text message.