Chapter 4728: PRECIOUS METALS DEALERS

4728.01 Precious metals dealer definitions.

As used in this chapter:

(A) "Precious metals dealer" means a person who is engaged in the business of purchasing articles made of or containing gold, silver, platinum, or other precious metals or jewels of any description if, in any manner, including any form of advertisement or solicitation of customers, the person holds himself, herself, or itself out to the public as willing to purchase such articles.

(B) "Superintendent of financial institutions" includes the deputy superintendent for consumer finance as provided in section 1181.21 of the Revised Code.

Cite as R.C. § 4728.01

Effective Date: 09-26-1996

4728.02 License requirements.

(A) Except as provided in division (B) of this section, no person shall act as a precious metals dealer without first having obtained a license from the division of financial institutions in the department of commerce.

(B) Notwithstanding any provision in this chapter to the contrary, a person holding a license as a pawnbroker pursuant to Chapter 4727. of the Revised Code may act as a precious metals dealer without being separately licensed pursuant to this chapter. Pawnbrokers are subject to all the requirements imposed upon the conduct of persons holding a regular precious metals dealer's license with respect to any articles that the pawnbroker purchases made of or containing gold, silver, platinum, or other precious metals or jewels of any description.

Cite as R.C. § 4728.02

Effective Date: 09-26-1996

4728.03 License qualifications.

(A) As used in this section, "experience and fitness in the capacity involved" means that the applicant for a precious metals dealer's license has had sufficient financial responsibility, reputation, and experience in the business of precious metals dealer, or a related business, to act as a precious metals dealer in compliance with this chapter.

(B)

(1) The division of financial institutions in the department of commerce may grant a precious metals dealer's license to any person of good character, having experience and fitness in the capacity involved, who demonstrates a net worth of at least ten thousand dollars and the ability to maintain that net worth during the licensure period. The superintendent of financial institutions shall compute the applicant's net worth according to generally accepted accounting principles.

(2) In place of the demonstration of net worth required by division (B)(1) of this section, an applicant may obtain a surety bond issued by a surety company authorized to do business in this state if all of the following conditions are met:

(a) A copy of the surety bond is filed with the division;

(b) The bond is in favor of any person, and of the state for the benefit of any person, injured by any violation of this chapter;

(c) The bond is in the amount of not less than ten thousand dollars.

(3) Before granting a license under this division, the division shall determine that the applicant meets the requirements of division (B)(1) or (2) of this section.

(C) The division shall require an applicant for a precious metals dealer's license to pay to the division a nonrefundable, initial investigation fee of two hundred dollars which shall be for the exclusive use of the state. The license fee for a precious metals dealer's license and the renewal fee shall be determined by the superintendent, provided that the fee may not exceed three hundred dollars. A license issued by the division shall expire on the last day of June next following the date of its issuance. Fifty per cent of license fees shall be for the use of the state, and fifty per cent shall be paid to the municipal corporation, or if outside the limits of any municipal corporation, to the county in which the office of the licensee is located. All portions of license fees payable to municipal corporations or counties shall be paid as they accrue, by the treasurer of state, on vouchers issued by the director of budget and management.

(D) Every such license shall be renewed annually by the last day of June according to the standard renewal procedure of Chapter 4745. of the Revised Code. No license shall be granted to any person not a resident of or the principal office of which is not located in the municipal corporation or county designated in such license, unless, and until such applicant shall, in writing and in due form, to be first approved by and filed with the division, appoint an agent, a resident of the state, and city or county where the office is to be located, upon whom all judicial and other process, or legal notice, directed to the applicant may be served; and in case of the death, removal from the state, or any legal disability or any disqualification of any agent, service of process or notice may be made upon the superintendent.

(E) The division may, pursuant to Chapter 119. of the Revised Code, upon notice to the licensee and after giving the licensee reasonable opportunity to be heard, revoke or suspend any license, if the licensee or the licensee's officers, agents, or employees violate this chapter. Whenever, for any cause, the license is revoked or suspended, the division shall not issue another license to the licensee nor to the husband or wife of the licensee, nor to any copartnership or corporation of which the licensee is an officer, nor to any person employed by the licensee, until the expiration of at least one year from the date of revocation of the license.

(F) In conducting an investigation to determine whether an applicant satisfies the requirements for licensure under this section, the superintendent may request that the superintendent of the bureau of criminal identification and investigation investigate and determine whether the bureau has procured any information pursuant to section 109.57 of the Revised Code pertaining to the applicant. If the superintendent of financial institutions determines that conducting an investigation to determine whether an applicant satisfies the requirements for licensure under this section will require procuring information outside the state, then, in addition to the fee established under division (C) of this section, the superintendent may require the applicant to pay any of the actual expenses incurred by the division to conduct such an investigation, provided that the superintendent shall assess the applicant a total no greater than one thousand dollars for such expenses. The superintendent may require the applicant to pay in advance of the investigation, sufficient funds to cover the estimated cost of the actual expenses. If the superintendent requires the applicant to pay investigation expenses, the superintendent shall provide to the applicant an itemized statement of the actual expenses incurred by the division to conduct the investigation.

(G)

(1) Except as otherwise provided in division (G)(2) of this section a precious metals dealer licensed under this section shall maintain a net worth of at least ten thousand dollars, computed as required under division (B)(1) of this section, for as long as the licensee holds a valid precious metals dealer's license issued pursuant to this section.

(2) A licensee who obtains a surety bond under division (B)(2) of this section is exempt from the requirement of division (G)(1) of this section, but shall maintain the bond for at least two years after the date on which the licensee ceases to conduct business in this state.

Cite as R.C. § 4728.03

Effective Date: 09-26-1996; 2006 HB699 03-29-2007

4728.031 Effect of child support default on license.

On receipt of a notice pursuant to section 3123.43 of the Revised Code, the division of consumer finance shall comply with sections 3123.41 to 3123.50 of the Revised Code and any applicable rules adopted under section 3123.63 of the Revised Code with respect to a license issued pursuant to this chapter.

Cite as R.C. § 4728.031

Effective Date: 03-22-2001

4728.04 License application - temporary exhibition permit.

(A) The application for a license under this chapter shall state fully the name and address of the person, or corporation, and of every member of the firm, partnership, or association, authorized to do business thereunder, the name of the individual responsible for the daily operation of the business, and the location of the office or place of business in which the business is conducted. In the case of a corporation, the application also shall state the date and place of incorporation, the name and address of the corporation's manager, the names and addresses of corporate directors, and the name and address of the agent, as provided in section 4728.03 of the Revised Code. The holder of a precious metals dealer's license shall keep the license posted in a conspicuous place in the office where business is transacted. No licensee shall transact or solicit business under any other name or location. Not more than one office or place of business shall be maintained under the same license, except as provided under division (C) of this section. In case of removal, the licensee shall provide written notice in advance to the division of financial institutions in the department of commerce of a prospective change of address of a business location. Upon approval by the superintendent of financial institutions, the division shall issue a new license. If the new location is outside the municipal corporation or county of the original licensed location, the licensee shall pay an additional license fee according to section 4728.03 of the Revised Code.

(B) A person licensed under this chapter shall post a conspicuous notice in its place of business visible to all patrons, in a form and at places designated by rule of the division, that the licensee has no right to retain goods stolen from the true owner, and that the owner may recover the goods or their value from the licensee in an action at law or, if the chief or head of a local police department or the chief's or head's representative takes custody of the goods, by release pursuant to section 2981.11 of the Revised Code.

(C)

(1) The superintendent may issue to a person licensed under this chapter or Chapter 4727. of the Revised Code a temporary exhibition permit for a term that coincides with that of the license of the licensee. A person issued a permit under this division may engage in the business of purchasing articles made of or containing gold, silver, platinum, or other precious metals or jewels from the public at a bona fide auction, convention, exhibition, fair, or show, the primary purpose of which is to display, trade, and sell articles made of or containing precious metals or jewels, for a period not to exceed seven days for any one auction, convention, exhibition, fair, or show.

(2) The superintendent shall determine the application procedures for and the form of the temporary exhibition permit described in this division, provided that a temporary permit shall state fully the name and permanent business address of the licensee to whom it is issued.

(3) The holder of a temporary exhibition permit shall, when participating in any auction, convention, fair, or show, conspicuously display the holder's permit at the location at which the holder transacts business.

(4) A permit holder who wishes to participate in an auction, convention, exhibition, fair, or show shall, at least two weeks prior to its scheduled opening, submit to the superintendent, or the chief or the head of the local police department with jurisdiction at the location of the event, the holder's name, the location of the auction, convention, exhibition, fair, or show, and the holder's permanent business address as it appears on the holder's permit issued under division (C)(2) of this section.

(5) All purchases of articles made of or containing gold, silver, platinum, or other precious metals or jewels conducted under a temporary exhibition permit are subject to sections 4728.06 to 4728.09 , 4728.13 , and 4728.99 of the Revised Code as if made under a license.

Cite as R.C. § 4728.04

Effective Date: 09-26-1996; 07-01-2007

4728.05 Investigations - injunctions.

(A) The superintendent of financial institutions may, either personally or by a person whom the superintendent appoints for the purpose, if the superintendent considers it advisable, investigate the business of every person licensed as a precious metals dealer under this chapter, and of every person, partnership, and corporation by whom or for which any purchase is made, whether the person, partnership, or corporation acts, or claims to act, as principal, agent, or broker, or under, or without the authority of this chapter, and for that purpose shall have free access to the books and papers thereof and other sources of information with regard to the business of the licensee or person and whether the business has been or is being transacted in accordance with this chapter. The superintendent and every examiner may examine, under oath or affirmation, any person whose testimony may relate to any business coming within this chapter.

(B) In making any investigation or conducting any hearing pursuant to this section, the superintendent or a person designated by the superintendent, at any time, may do any of the following:

(1) Compel by subpoena the attendance of witnesses;

(2) Take depositions of witnesses residing without the state in the manner provided for in civil actions;

(3) Pay witnesses the fees and mileage provided for under section 119.094 of the Revised Code;

(4) Administer oaths;

(5) Compel by order or subpoena duces tecum the production of all relevant books, records, accounts, and other documents and examine such books, records, accounts, and other documents.

(C) If a person fails to comply with a subpoena or subpoena duces tecum, the superintendent may apply to the court of common pleas of Franklin county for an order compelling the person to comply with the subpoena or subpoena duces tecum or, for failure to do so, an order holding the person in contempt of court. The superintendent, in accordance with section 4728.03 of the Revised Code, may suspend or revoke the license of any precious metals dealer who fails to comply with this division.

(D) In connection with any investigation under this section, the superintendent may file an action in the court of common pleas of Franklin county or the court of common pleas of the county in which the person who is the subject of the investigation resides to obtain an injunction, a temporary restraining order, or other appropriate relief, if it appears to the superintendent that the person is engaging in actions or threatening to engage in actions in violation of this chapter.

(E) If in an investigation under this section the superintendent determines that a person not licensed under this chapter, or an employee of that person, has been or is engaged or is threatening to engage in activities for which a license is required under this chapter, the superintendent may issue an order to that person requiring the person to show cause why the person should not be subject to licensure under this chapter. If the superintendent determines, after notice and a hearing conducted in accordance with Chapter 119. of the Revised Code, that a person is engaged in, or is threatening to engage in activities that constitute a violation of this chapter, the superintendent may issue a cease and desist order that describes the person and activities that are subject to the order and may impose upon the person a penalty of not less than one hundred nor more than ten thousand dollars for a violation of this chapter. Any cease and desist order and any penalty issued under this section are enforceable in and may be appealed to a court of common pleas pursuant to Chapter 119. of the Revised Code.

Cite as R.C. § 4728.05

Effective Date: 09-26-1996; 2008 HB525 07-01-2009

4728.06 Records.

Every person licensed under this chapter shall keep and use books and forms approved by the superintendent of financial institutions, which shall disclose, at the time of each purchase, a full and accurate description including identifying letters or marks thereon of the articles purchased, with the name, age, place of residence, driver's or commercial driver's license number or other personal identification, and a short physical description of the person of the seller. The licensee also shall write in the book the name of the maker. The licensee shall keep the books in numerical order at all times at the licensed location, open to the inspection of the superintendent or chief of or head of the local police department, a police officer deputed by the chief or head of police, or the chief executive officer of the political subdivision thereof. Upon demand of any of these officials, the licensee shall produce and show an article thus listed and described which is in the licensee's possession.

Cite as R.C. § 4728.06

Effective Date: 09-26-1996

4728.07 Daily report of items received to police department.

Each person licensed under Chapter 4728. of the Revised Code, shall, every business day, make available to the chief or the head of the local police department, on forms furnished by the police department, a description of all articles received by the licensee on the business day immediately preceding, together with the number of the receipt issued.

Cite as R.C. § 4728.07

Effective Date: 03-17-1987

4728.08 Purchases from intoxicated persons prohibited.

No person licensed under Chapter 4728. of the Revised Code shall purchase any articles from any minor, or from any person intoxicated or under the influence of a controlled substance, from any person who is known or believed by the licensee to be a thief, or a receiver of stolen property.

Cite as R.C. § 4728.08

Effective Date: 03-17-1987

4728.09 Retention period - stolen property.

(A) A person licensed under Chapter 4728. of the Revised Code shall retain in this state any articles purchased by him until the expiration of five days after the date of purchase.

(B) If the chief or head of the local police department to whom the licensee made available the information required by this chapter has probable cause to believe that the article described therein is stolen property, he shall notify the licensee in writing. Upon receipt of notice, the licensee shall retain the article until the expiration of thirty days after the day on which he is first required to make available the information required by this section, unless the chief or the head of the local police department notifies the licensee in writing that he is not required to retain the article until the expiration.

(C) If the chief or the head of the local police department determines the identity of the true owner of the allegedly stolen article, that has been purchased and held by a licensee, and informs the licensee of the true owner's identity:

(1) The licensee may restore the allegedly stolen article to its true owner directly.

(2) The true owner may reimburse the licensee for the amount the licensee paid for the allegedly stolen article.

(3) The true owner may recover the article and reasonable attorney fees from the licensee in an action at law.

(D) If it is determined that the true owner of the allegedly stolen article, for whatever reason, chooses not to file a charge against the person or persons responsible for the theft, the licensee may charge the true owner of the allegedly stolen article the amount the licensee paid for the allegedly stolen article.

Cite as R.C. § 4728.09

Effective Date: 07-22-1994

4728.10 Enforcement duties.

The superintendent of financial institutions shall enforce this chapter, make all reasonable effort to discover alleged violators, notify the proper prosecuting officer whenever the superintendent has reasonable grounds to believe that a violation has occurred, act as complainant in the prosecution thereof, and aid officers to the best of the superintendent's ability in prosecutions. The superintendent shall employ deputies necessary to make the investigations and inspections, and pursuant to Chapter 119. of the Revised Code adopt reasonable rules, including rules that define terms used in this chapter, for the carrying out of this chapter, and otherwise perform the duties imposed by this chapter.

Cite as R.C. § 4728.10

Effective Date: 09-26-1996

4728.11 Chapter not applicable.

This chapter does not apply to any of the following:

(A) Any purchase of an article that is made of or contains gold, silver, platinum, or other precious metals or jewels of any description if both the buyer and seller, or the respective agents, brokers, or other intermediaries of both the buyer and seller, deal in such articles or otherwise by their respective occupations, or by their respective avocations as collectors, speculators, or investors, hold themselves out as having knowledge or skill peculiar to such articles or the practices involved in their purchase or sale;

(B) Licensees who obtain licenses under sections 1321.01 to 1321.19 of the Revised Code or registrants who obtain certificates of registration under sections 1321.51 to 1321.60 of the Revised Code;

(C) National banks, state banks, credit unions, or savings and loan associations;

(D) The holder of a salvage motor vehicle dealer's license under Chapter 4738. of the Revised Code who purchases or sells precious metal which, in its original form, is a motor vehicle component part, or a scrap metal processor subject to Chapter 4737. of the Revised Code;

(E) Any purchase of silverware or an article of jewelry made of or containing gold, silver, platinum, or other precious metals or jewels that is made by a person who complies with all of the following:

(1) The person is engaged in the business of selling, at retail, articles of jewelry and silverware;

(2) The person holds a valid vendor's license issued under section 5739.17 of the Revised Code;

(3) The person maintains a fixed place of business in this state at which the person regularly exhibits articles of jewelry and silverware that are for sale at retail;

(4) The person establishes to the satisfaction of the superintendent of financial institutions or the chief or head of the local police department, upon their request, that the person's purchases of silverware and articles of jewelry that are made of or contain gold, silver, platinum, or other precious metals or jewels are incidental to the person's primary business as described in division (E)(1) of this section. Such purchases are "incidental" if:

(a) In the case of a person who has been in business for less than one year, the average monthly value of the person's purchases of jewelry from the public represents less than twenty-five per cent of the person's total inventory of articles of jewelry held for sale at retail to the public, as computed under section 5711.15 of the Revised Code;

(b) In the case of a person who has been in business for at least one year, the total value of the person's purchases of jewelry from the public represents less than twenty-five per cent of the person's total retail sales of articles of jewelry to the public during the immediately preceding year;

(c) The purchases are of items described in division (F) of this section.

(F) Any purchase of coins, hallmark bars, registered ingots, and other items as numismatic objects, and not for their content of precious metals.

(G) Any purchase made under the supervision of a probate court from the estate of a decedent as provided under section 2113.40 of the Revised Code.

(H) Except as specified in division (B) of section 4728.02 of the Revised Code, any person licensed under Chapter 4727. of the Revised Code.

Cite as R.C. § 4728.11

Effective Date: 09-26-1996

4728.12 Person exempt from license requirement.

(A) A person exempt from licensing under division (E) or (F) of section 4728.11 of the Revised Code, and who in the ordinary course of the person's business obtains ownership by purchase of articles made of or containing gold, silver, platinum, or other precious metals or jewels of any description from the public, shall maintain at each business location for at least the twelve months immediately succeeding any such transaction a record that shall include the following:

(1) The date and time of the transaction;

(2) The name and residential address of the seller and the means of identification used to establish the seller's identity;

(3) A physical description of the seller;

(4) A complete and accurate description of the article, including any brand names, initials, serial numbers, or other identifying marks, monograms, or symbols on the article;

(5) The price paid for each article and the means of payment. As used in this division, "purchase" does not include obtaining title to an article that is accepted as a trade-in by a person exempt from licensing under division (E) or (F) of section 4728.11 of the Revised Code when the transaction involves a retail sale of an article of equal or greater value and the value of the trade-in is used as all or a portion of the purchase price, nor does "purchase" include any purchase made under the supervision of a probate court as provided under section 2113.40 of the Revised Code.

(B) No person exempt from licensing under division (E) or (F) of section 4728.11 of the Revised Code shall purchase any article that is made of or contains gold, silver, platinum, or other precious metals or jewels of any description from any individual whom the person knows or has reason to believe is under eighteen years of age.

(C) Within sixty days after opening a new business location, any person exempt from licensing under division (E) or (F) of section 4728.11 of the Revised Code shall notify in writing the chief or head of the police department having local jurisdiction in the place where the business is located of the location of the records the person maintains pursuant to division (A) of this section. These records shall be available during normal business hours for inspection by the superintendent of financial institutions or the superintendent's designee, or by the chief or head of the local police department or the chief's or head's designee.

Cite as R.C. § 4728.12

Effective Date: 09-26-1996

4728.13 Prohibited acts - burden of proving exemption.

(A) No person, firm, partnership, corporation, or association, and no agent, officer, or employee thereof, shall violate this chapter. The division of financial institutions upon a criminal conviction shall revoke any license theretofore issued to the person, firm, partnership, corporation, or association. The division also may revoke or suspend the license of any licensee in accordance with section 4728.03 of the Revised Code upon a criminal conviction of the licensee for any felony offense or crime involving moral turpitude.

(B) No person shall obstruct or refuse to permit any investigation conducted under this chapter by the superintendent of financial institutions, a person acting on behalf of an agency or a political subdivision of this state, or a law enforcement officer. All articles purchased by a person licensed under this chapter shall be made promptly available for inspection by these officials.

(C) In any proceeding or action brought under this chapter, the burden of proving an exemption from a requirement of this chapter falls on the person claiming the benefit of the exemption.

Cite as R.C. § 4728.13

Effective Date: 09-26-1996

4728.14 Civil action.

Any person who is injured by the failure of a person who is engaged in the business of purchasing articles that are made of or contain gold, silver, platinum, or other precious metals or jewels of any description to comply with this chapter may commence a civil action to recover compensatory damages from such person. In any action under this section, the court may award punitive damages or reasonable attorney's fees to a prevailing plaintiff.

Cite as R.C. § 4728.14

Effective Date: 04-19-1988

4728.15 Compliance with law regarding sanctions for human trafficking.

The division of consumer finance shall comply with section 4776.20 of the Revised Code.

Cite as R.C. § 4728.15

Added by 129th General AssemblyFile No.169, HB 247, §1, eff. 3/22/2013.

4728.99 Penalty.

Whoever violates Chapter 4728. of the Revised Code is guilty of a misdemeanor of the first degree on a first offense and a felony of the fifth degree on each subsequent offense.

Cite as R.C. § 4728.99

Effective Date: 07-01-1996