The Pawnshop Beat
The first and last time I walked into a pawnshop was when I did this story. On second thought, I may have been in a pawnshop or two when I was a kid, accompanying my dad on trips to find some bargain items, maybe a guitar for my older brother Greg or something like that. But otherwise my only take on pawnshops is derived from the movies and from books and articles. My research for this story didn’t necessarily overturn any assumptions I had about these places, other than the fact that they can be extremely large and profitable operations with vast warehouses full of merchandise that rival that of discount department stores. This story for the Omaha Weekly may not dispel any of your ideas about pawnshops either, but after doing the piece I did have a better appreciation for why they are so ubiquitous — simply put, they fill a need or demand that all the banks and loan offices cannot. I try in the piece to present the good, the bad, and the gray about these marketplace and moneychanging emporiums, where commerce of all kinds is transacted.
The Pawnshop Beat
©by Leo Adam Biga
Originally appeared in the Omaha Weekly
In what is a combination bazaar, everything-under-one-roof discount store and cash-on-the-barrelhead lending operation, the neighborhood pawnshop offers something for everyone. This marketplace for buying, trading and borrowing is a center of commerce where the down-and-out rub shoulders with the upwardly mobile in a common search for a good deal. From cars and boats to lawn mowers and weed whackers to guns and games to stereos and VCRs to rings and necklaces, pawnshops, which have been called the world’s greatest garage sale, deal in it all.
Because they are also historically dumping grounds for stolen goods, every single transaction is reviewed by law enforcement authorities, who, based on hunches and crime reports, look for red flags in the merchandise moved there and in the profiles of customers doing business there.
You generally don’t seek a loan at a pawnshop unless some life event — usually a bad one — has brought you to one. Maybe you’re out of work or in between pay checks. Maybe your credit cards and checking accounts are tapped out. Maybe your car’s on the blink. Maybe medical bills are due. Perhaps you’ve lost more than you can afford at Harvey’s.
Whatever your story, and there’s a million of them, you find yourself strapped for cash and unwilling or unable to borrow from family, friends, traditional lending institutions and more non-traditional sources like loan sharks. So, you grab whatever possessions you can lay your hands on and hock them for some greenbacks to help you get out of a bind. Often described as the bank of last resort, pawnshops are, for some, a stop-gap money source for when true crises arise and for others simply a way of life whose no-questions-asked ready-cash supply helps folks get by when other avenues are closed.
Jack Belmont, who’s been in the trade since growing up in the Great Depression, explained the basic appeal for people of doing business at a pawnshop as opposed, for example, to a bank. “It’s a quick deal,” he said from behind the main counter at Mid-City Jewelry & Loan, where he is a partner with owner Don Hoberman. “You walk in when you feel you’ve got something to pawn and you make the loan. You can be in and out of here inside of five minutes. You can come back anytime you want. Nobody knows your business. You don’t have to fill out a balance sheet or anything else like that. It’s very convenient, very quick.”
For those engaged in that left-handed form of human endeavor known as crime, pawnshops are convenient places to unload hot property and turn a fast buck, although the chances of avoiding detection are slim. Indeed, if it wasn’t for pawnshops, police officials say, many stolen goods would not be recovered. When stolen property in a pawnshop is detected and its rightful owner contacted to identify and retrieve it, the owner is invariably upset to find out he or she must pay to get the stuff back. This redemption charge, which is usually a fraction of the item’s cost, may seem somewhat heartless but is completely legal.
Clerking at a pawnshop is a little like being a bartender or a barber. Just about everyone who sidles up to the counter has a hard luck story to tell. Saul Kaiman, the introspective bearded owner of Sol’s Jewelry & Loan, which has four locations in the Omaha metro area, said, “When I first started working in pawnshops in the ‘50s I heard so many tales of people needing $50 to get to a funeral that I didn’t think there was anybody left alive in the United States. I was naive. I believed everything they said at first. After awhile, you know some of them are just stories and you just try to keep a straight face,” he said.
Christy, a pretty clerk in Sol’s downtown store at 514 N. 16th Street, said she has heard it all. “We get a lot of people who need help with their bills or need to get their car fixed or need to get their house repaired. Once in a while we get pawners who’ve never pawned before. They have some family emergency and they actually cry they’re so desperate.”
For a gun lover, getting a loan on a prized weapon can be as torturous as giving up a first-born son. At least that’s how painful it appeared for a man wearing a jacket and hat emblazoned with NRA slogans who came to Sol’s to pawn his Mossbach 810 rifle: “My car broke down and I needed to get it working again and this is all I had to get me what I need to get by,” he said, referring to the gun. “It’s a very fine gun. I just want to get it back.” He said it’s the first time he’s had to give up his gun. As with any pawn transaction in Nebraska, he has four months to redeem his weapon, with interest accruing from the date of the loan.
According to Tedi, a pert and petite clerk at Sol’s downtown store, “There’s a lot of people that come in here that feel bad about the circumstances they’re in. I tell them that it’s happened to everybody. That bad stuff happens and we all need money to get out of jams, and that’s what we’re here for. I try not to make them feel embarrassed about. I try to make them feel like it’s OK.”
Don Hoberman, the sardonic owner of Mid-City Jewelry and Loan at 515 So. 15th Street, explained there is an implied Don’t Ask-Don’t Tell pact in place at pawnshops to protect people’s privacy. “You don’t ask them why” they need the cash, he said. “It’s immaterial anyway. It’s their money. They don’t have to tell me why. Some people just walk in, borrow money and walk out. But some people feel they have to, so you listen,” he said.
A pretty but sad-eyed wife and mother of two recently entered Sol’s looking distraught as she used one hand to push an electric snowblower ahead of her and the other hand to cart a camera case. “I missed a payday at work and I needed a little help to pay some bills today. That way I won’t get behind and I know I still have time to come back down and get my stuff out. I’ve been dealing with Sol’s for 10 years and they don’t ask any questions — they just help if they can.” With her $275 loan in hand, she left with a smile.
Customers don’t always leave happy, however. In assessing the fair market value of a pawned item, for example, there is bound to be some difference of opinion. Christy at Sol’s said, “We get quite a few irate customers. They get mad because we don’t give them what they want or they think we’re gypping them. We’re not. We’re being fair with the game. When they sign the contract they know what they’re signing.” Tedi at Sol’s added, “No matter how hard we try to explain the loan process, you get some people that…don’t seem to understand that the item they pawned a year ago and never paid on is no longer here, because if you don’t come back for it or pay on it after four months we can sell it. A lot of times it was a sentimental thing, and they’re angry about it. Like it’s all our fault.”
Then there are the regulars. Take Judy Johnson, for example. She often pawns jewelry at Mid-City to help tide her over when things are tight. “Right now I’m painting my house, and I need extra money” for supplies, she said one morning at the shop. She still has several jewelry pieces in hock.
“I miss them a lot,” she said. She is one of several loyal customers to follow Belmont to Mid-City from the shop he and his late brother ran, and that their late father started, Crosstown Loan, which was located on N. 24th Street until it burned down in the 1969 riot, and which later moved to 16th Street. At Sol’s, the regulars include a mother-daughter combo who say they’re such frequent customers that “they should put a revolving door in for us.” Kaiman said many elderly customers, including a man who pawned his Colt. 38 revolver over and over again, make a habit of pawning as much for the social interaction as for the money.
Hoberman and partner Jack Belmont own a combined 90-plus years in the business. For them, the pawnshop is a kind of social laboratory and money changer in one where the disparate mix of human kind meet to haggle and strike a deal.
So, what’s the oddest thing someone has tried pawning? Hoberman recalled the man who came in once and asked, ‘Do you take anything?’ I said, ‘Yeah.’ He goes, ‘How about an eyeball?’ I said, ‘C’mon quit kidding.’ So, he popped it out and put in on the counter. And I said, ‘Make it wink.’ He couldn’t do it, so I had him put it back.” Then there was the World War II veteran who made a habit of pawning his prosthetic leg, which he never picked up — Veterans Administration Hospital workers did. Hoberman draws the line at living creatures. “We always figure if you gotta feed it or clean it, you don’t want it, so we don’t take it.”
You never know who will show up at a pawnshop, either. Back in the early 1980s then-Governor Bob Kerrey, who became a good friend of the store’s through his predecessor, former governor and senator Jim Exon, whom Hoberman knew from Exon’s days in the furniture business, stopped by to ask, “What do you give somebody who’s a movie star?” Kerrey was referring to his then girl-friend, screen actress Debra Winger. “I told him one of the fashionable things was pearls, and so we acquired 30-inch strand of pearls and he gave them to her for a present. Two day afterwards her picture was taken at some event and she had them on. He sent me the picture. He doesn’t have the girl anymore, but she still has the pearls.”
If all his years in the trade have taught him anything, Hoberman said, it is that people “from all walks of life” — from high rollers to penniless tramps — frequent pawnshops and the thing is you can’t always tell who’s who.
“You can’t qualify who comes through the front door and decide what they’re going to pawn or what they might be able to buy. It’s a lesson I learned a long time ago. I once had somebody pawn a $5 watch and then he wanted to look at a $1,000 ring. And I thought, Well, why should I show him this ring when he’s having trouble getting $5 together?
“But I soon learned you don’t look at it that way. The guy came back and he said, ‘Thank you for loaning me on the watch,” and he walked over to the jewelry case and plunked down cash to buy the ring. You see, you just don’t decide what they can and can’t do by what they look like.” In other words, assuming someone is broke just because he or she needs fast cash is a no-no. “It isn’t always because you’re broke,” Hoberman said, “it’s because you’re short.”
Or, as a distinguished looking black man said one morning at Sol’s, where he was redeeming a bracelet he originally bought there, “I get paid every two weeks and with utilities the way they are and everything in general going up, I get little shortfalls between paychecks, and so pawning’s a matter of just being able to make it and keep everything current with bills, groceries, bus fare and things like that.” He added, “You know, sometimes you don’t want to do it, but it just comes in handy as a safety net. It’s just another tool in helping you make it through.”
Besides, the kind of fast turnover loans made by pawnshops just aren’t available elsewhere. “Say you have a ring you bought at a retail store for $1,000, and now you need $200 for something. You can’t take it (the ring) to the bank because they don’t loan on products like that,” Hoberman said. “Even if the ring was worth $40,000, the bank still won’t loan on it. I have people come in with $10,000 in their pocket. They need another $4,000 to buy something and they’ve got to do it NOW. They come with something we can loan them $4,000 on and they’re out the door and they’re back.”
Hoberman believes most people find themselves financially short due to their own actions or decisions. He points to the casinos across the river as a major reason why some people end up on the margins or fringes. He said where items were once being redeemed at a nearly 80 percent rate, they are now redeemed at only 62 percent.
“The redemption percentage has dropped because I think people never recover from their gambling losses,” he said. “I have one gentleman who pawns his car here. He stops in on his way to the casino. We loan him money on the car, then we drive him over and drop him off at the boat, and we put his car into storage. On occasion…he hits and he’s back to get his car the same day.” Other times, the car sits in storage for days or weeks before he can afford to retrieve it.
Kaiman, of Sol’s, agrees that gambling addiction, along with drugs, accounts for the lower redemption rates being seen in pawnshops.
“My personal opinion is that a lot of people get financially hurt over at the casinos. You know they pawn their diamond ring or something with hopes of winning over there. They don’t win and they don’t have enough to get it back. The casinos have probably changed the way we operate more than anything than I can remember. It used to be a cyclical thing. From October to February more people were buying things and picking up things, and the rest of the months were more input — with people bringing things in more than picking up. But because the casinos are 12-months a year, 24-hours a day, that’s changed a lot. We get less pickups and just more coming in.”
It’s meant an ever expanding inventory at Sol’s, which must increasingly try to resell unredeemed items, often at close to cost just to reduce backlogs.
Detective Mike Salzbrenner of the Omaha Police Department’s Burglary/Pawn Unit works the local pawnshop beat. He, and his colleagues, follow a daily routine that finds them making the rounds at the local shops, where they scour through identification cards completed on every transaction. Each pawn card includes the customer’s name, address, telephone number, height weight and fingerprint as well as a summary of the transaction and a description of the items dealt. Rifling through the cards, the well-tanned and blue-suited Salzbrenner looks for anything that appears fishy.
“See, this one bothers me,” he tells a visitor one morning at Sol’s. “Here’s a young lady who just turned 18, which is the legal minimum age to pawn, and she brought in a $250-$300 tennis bracelet. Because of her age, that makes me think the bracelet’s her mother’s or somebody’s. That’s one I’ll call and speak with the mother about. I swear, half the time the mother will come back and say, ‘It’s not in my jewelry box.’ And I’ll tell her, ‘I’m sorry ma’am, but she just pawned it and you better find out why.” Often, Salzbrenner said, it’s to support a drug habit or to cover debts.
Although he has no hard evidence to prove it, Salzbrenner is sure that pawning — of stolen goods or not — has increased since the arrival of the casinos. Gambling debts, he said, force otherwise law-abiding citizens to take desperate measures. “A typical case I’m working on is somebody with a gambling problem. They get addicted to gambling and, of course, they run out of money. They turn around and start stealing from their employer. Well, a lot of these people are not common thieves. They wouldn’t know a fence out on the street. But they do know pawnshops, where they go and claim items as their own and get $20 for a watch or whatever. They go across the river, lose their money and they want to gamble again.” So, they steal again. And the cycle goes on.
The job, Salzbrenner acknowledges, calls for much interpretation. “We’re the judgment call beat. We’re looking for anything suspicious. Suspicious to us,” he said, includes youths bringing in merchandise not appropriate to their age or anyone selling things, especially new items, for a fraction of their value or customers not knowing much about the goods they represent as their own.
He said in following up on questionable deals, citizens often grow defensive about what they consider a hassle and an intrusion into their private lives. “We get a lot of accusations thrown at us. A lot of times they say, ‘If there’s no victim, then why are you bothering me?’ Well, I tell them, we’re trying to find out if there is one.”
When his nose tells him something stinks, he said, he’ll track the customer’s pawn and criminal records on the police computer, he’ll place phone calls and he’ll make other inquiries until he’s exhausted all lines of investigation. “Somebody’s going to have to satisfy me someplace,” he said. Until he has an answer, he can put a hold on any item, and it cannot be touched again until he releases it.
Salzbrenner’s superior, Sgt. Mary Bruner, said smart thieves either avoid pawnshops altogether — preferring to exchange their ill-gotten goods on the street — or else enlist accomplices, including residents of shelters, to pawn the booty, which makes suspect identification and apprehension more difficult. While only a fraction of all stolen goods is ever recovered, Bruner said the OPD’s Burglary/Pawn Unit cleared a record $752,000 in recovered stolen property last year. Contributing to that total, she said, was the unit cracking a couple large jewelry theft rings.
According to Hoberman, the way business is conducted at pawnshops these days — with paperwork filled out in triplicate and unredeemed items stockpiled in warehouses brimming with goods from floor to ceiling — some of the joy has gone out of the work. He said there isn’t quite the trust and conviviality there once was.
“People have changed. It used to be word was bond. Way back, a guy would come in with a two-cent lead pencil and you’d loan him $10 on it. Now, that may sound strange, but his word was bond. That’s all he had was his word. He would come back and get that lead pencil. Now, he knew he could go out and buy another pencil for two cents. He didn’t have to come back and pay that $10, but he would. It used to be a little more casual and a lot more fun. It’s still fun, but it’s more business. Back in the old days you could kind of fly by the seat of your pants. I used to keep a whistle under the counter and when it would get really crazy in here, I’d blow the whistle and say, ‘Wait a minute, let’s start this whole day over.’”
- Pawnshops finding unlikely customers (seattletimes.nwsource.com)
- Pawnshop oddities reflect Gulf struggles (cnn.com)
- Before the Wall Street Crisis, There Was “Poverty, Inc.” (politics.usnews.com)
- Pawning the family heirlooms (money.cnn.com)
- Pawnshops Becoming More Respectable (volokh.com)
- Groupon Founders Reinvent The Pawnshop (fastcompany.com)
- Pawnshops Flourish in Hard Times, Drawing Scrutiny (time.com)