Current through Reg. 50, No. 13; March 28, 2025
(a) Responsibility. A pawnbroker must repair or replace, with like kind merchandise, pledged goods that are either lost or damaged while in the pawnshop's possession.
(b) Acceptance of payments. Any payment may not be accepted from the pledgor and the original pawn ticket must be returned when pledged goods are:
(1) lost and not replaced;
(2) damaged and not restored to the condition at the time pledged; or
(3) unavailable for redemption.
(c) Accrual of pawn service charges. No pawn service charge may be earned after a pledgor offers to redeem, renew, or extend pledged goods through the date the pledged goods or equivalent replacements are available for redemption and that fact is communicated to the pledgor.
(d) Documentation. Certain information must be retained concerning pledged goods that have been lost or damaged. The information may be recorded in the numerical pawn ticket file or in the automated records of the pawn transaction, must be readily available for examination, and must include the following information:
(1) date of discovery of the loss or damage;
(3) identification of the lost or damaged property;
(4) evidence of delivery of the disclosure required in subsection (e)(6) of this section;
(5) date of resolution; and
(6) manner in which the matter was resolved.
(e) Communications with pledgors.
(1) A pledgor must not be misled as to the pawnbroker's liability whether through any posting, oral statements, or any other conduct.
(2) A prompt attempt must be made to satisfy the pledgor by repairing or replacing the lost or damaged goods.
(3) A pledgor may not be advised that the replacement of lost or damaged pledged goods will be accomplished in any manner that is more limited than replacement with like kind goods or restoration of damaged goods to the condition at the time pledged.
(4) Replacement items must be made available for the pledgor's inspection at the same location where a pledgor would redeem, renew, or extend the pawn transaction.
(5) A pledgor must be informed that the pledgor has a right to have the like kind replacement or restoration reviewed by the OCCC in accordance with subsection (h) of this section and that no judicial remedy may be sought until 91 days after a complaint has been filed with the OCCC.
(6) When an attempt or offer to redeem, renew, or extend a pawn transaction is made and it is known or learned that pledged goods have been lost or damaged, the pledgor must accurately be informed of the facts of the situation, the status of the pledged goods, the pawnbroker's responsibility under Texas Finance Code, Chapter 371, and the pledgor's rights under paragraph (5) of this subsection. A model disclosure is provided in the following example.
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(f) Alternative resolution. Once compliance with subsection (e) of this section is accomplished, at the pawnbroker's option, an offer of a cash settlement or a substitution as an alternative to replacing or repairing the lost or damaged goods may be made.
(g) Partial redemption. If one or more items pledged on a pawn transaction are not lost or damaged and are available for redemption, the pledgor may redeem the available items by negotiating a partial, proportionate payment not to exceed the pawn service charge limitations in Texas Finance Code, Chapter 371, Subchapter D.
(h) Replacement complaints. A person attempting to redeem lost or damaged goods may file a written complaint with the OCCC. The complaint form is available on the OCCC's website . The OCCC will begin review of a complaint for lost or damaged items upon receipt of the written complaint.
(1) Upon receipt of a written complaint, the commissioner may:
(A) request copies of the pawn ticket and all related documentation;
(B) analyze the complainant's authority to receive a replacement;
(C) review additional information (e.g., appraisal, picture, insurance information) provided by either party;
(D) provide a time frame for producing proposed like kind replacement merchandise.
(2) When a replacement item is available, the pledgor and the commissioner must be informed that:
(A) a replacement item is available for inspection; and
(B) the replacement item has not been inspected by the commissioner to determine if it is like kind merchandise.
(3) The commissioner may initiate an on-site inspection to review the replacement.
(4) After conducting an on-site inspection, the commissioner may either:
(A) direct another item be produced for replacement within a specified period of time for inspection; or
(B) issue a letter of determination stating that the merchandise offered is like kind and the complaint is closed. At that time the pledgor may seek a court remedy at the pledgor's expense if the pledgor is dissatisfied with the determination of the commissioner.
