Monday, September 27, 2010

The Pawn Shop - What We Know, What's To Come

(this close-up and the original photo below courtesy of Kevin from About Time Boutique)

After a flurry of weekend activity and some conversations with the owner of the pawn shop and the residents and business owners who are trying to keep it from opening, I wanted to share some information and a few thoughts of my own.

Things got started when Bob, the owner of four pawn shops around Brooklyn, saw an ad and called the landlord at Park and Franklin a few months ago. The space he saw had already been prepped for a "Cash for Gold" establishment that didn't end up opening, so he snapped up the lease. When I asked him about the connection between pawn shops and crime, he responded that he trains all of his employees personally, requires New York State identification for transactions, records everything with audio and video, and posts every item that comes into his shop on Leads Online, a for-profit service used by law enforcement agencies to help track stolen property (the NYPD come into one of his shops looking for something once every month or two). He doesn't rotate stock between shops, he abides by all state laws regarding interest rates (4% in New York State), and he's worked with the NYPD before on stings and set-ups. He says that he's more than amenable to local residents coming in looking for stolen property, though he said it only happens once or twice a year.

So Bob, by his own description, is a model pawnbroker, the ideal type promoted by the National Pawnbrokers Association, an organization that takes pains to point out that 80% of pawned items are collected by their owners, and which argues that pawn shops provide an essential service to low-income citizens who cannot get credit cards or bank accounts, as this sympathetic NYTimes article from 2007 suggested (this concern was also raised in the comments to the previous post). What's not to like?

Well, it's still a pawn shop. As I said in the last post, there is an overwhelmingly strong correlation between pawn shops and crime (seriously, Google "pawn shop property crime correlation" and you will not find a single serious study that suggests otherwise). The simple truth is that no matter how well-run it is, the presence of a pawn shop in a neighborhood means property crime goes up, because criminals THINK that they can pawn stolen items there (it's a simple calculus, really). This also means the violence associated with property crime - muggings, home invasions, etc - goes up. Sure, it's nice to know that I can swing by and pick up my phone or laptop after it's been jacked, but is the pawn shop going to give me back the sense of security I had before I was held at gunpoint, or pay the bills for the dental work I needed after I was punched in the face? Also, after the revelations of the NYPD Tapes, do residents really want to rely on officers to file reports, run searches, and get their stuff back? Put it this way - owning a pawn shop is like owning a handgun store: sure, there are intervening actors, and you're within your rights, but because your business exists, people are going to get hurt. Legality does not equate to morality.

Also, a quick note on the notion of cash loans as a service to the community, something that Laurel addressed really well in her post at Nostrand Park. Cash loans at these rates don't benefit anyone. Sure, pawnbrokers associations like to point out that close to 80% of items pawned are later bought back, but what they aren't telling you is that many people repeatedly pawn items, and pawning only gets them further into financial trouble, as they rotate pawned items to keep from losing something and constantly find themselves in deeper and deeper holes on account of the interest rates. The process is, in many ways, a form of urban sharecropping, which guarantees the pawn shop continued sources of income from hard-up residents who have no way out of the cycle.

Is the system broken? Absolutely. Banks and credit card companies (the bonanza of 2003-2007 notwithstanding) routinely redline poor and working-class communities (and particularly communities of color), keeping loans away from those who need them most. But just because the system's broken, that doesn't make it okay for pawn shops and cash-4-gold places to exploit people. I defer to the great Omar Little on this one.

So that's what we know - a well-run pawn shop is coming in, but it's still going to cause a spike in crime in the neighborhood. Where to from here? To his credit, the owner has offered to take down the glaring signs (above) and replace them with something less obvious and perhaps less likely to attract a criminal element. That's a start, but it's not really a solution. Reports have it that certain members of the community are trying to buy him out, which seems like a good way to address this (from what I understand, there's no legal recourse to stop the shop at this point process), but is admittedly expensive, especially given that the location is fitted out for this sort of business. In the meantime, the local group leading the opposition (which includes some CHCA members but is not limited to the group) is calling for a boycott of the pawn shop and the laundromat, in order to impact the landlord who brought this shop to Franklin (and who was apparently planning to have another, similar establishment from the get-go). If someone has a better idea for how to convince the landlord to address this issue (he's apparently been rather callous about the whole situation), let's hear it.

Finally, a word about the need for better credit in communities like ours. I've heard the CHCA mention ties to the Chase branch on Bedford and Eastern before, so perhaps they could help connect people to this bank and help them get access to credit on a fair footing. The city government also offers assistance opening bank accounts. I'm unaware of any credit unions in the area, but if there are, pass along the information. It's possible that we've got some financial professionals in the neighborhood as well - maybe they could be convinced to offer informational clinics to people in need of loans to get by in this economy.

19 comments:

  1. This is a great idea. The way things r going we need all the help we can get. Some of us r really struggling through all the layoffs and cutbacks that we r barely making ends meat. This Bob seems like a professional who will not entertain thieves. Looks more to me like he is opening opportunities to the community that live in the neighborhood to get through all of NYC increases through out the years. MTA ask for money and gives us less security. What about the tolls; give me a break. Even the Yellow Taxi surcharges go to support the MTA;and what do they offer us a intercom. You guys really want to protest and make a difference then Do it where it counts. Down at City Hall. Where we need your voices more than ever.

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  2. Crime has increase in the past 5 years but not due to Pawnshops. Let's look at the real picture. Crime is up by 70% due to real estate increase, Fare increase, War, Government oblivious spending, the deficit, Layoffs in the Subway system, Bus eliminations. Closing of Firehouses. Police officer cut backs. Even our school percentage rate is 19%. They wanted to eliminate transportation for the students when i went to school i had a pass. When did have a value to it. Our unemployment hits sky rocket this year. Why? Not because the Pawnshops but because; We don't utilize our energy and brains in that right direction.

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  3. Pawn shops r not as dirty as people make it out to b. If you look at it they r appraisal shops. They will be able to tell you if what u have is worth what u paid. They also provide a service for a minimum charge and would be able to offer you a loan on your collateral. I know plenty of people who don't wear any of their beautiful jewelry from the 20's and 30's called old gold because of the crime rate. They r afraid of getting robbed. The banks r giving everyone a hard time for a small loans ever since they got their grants from the government. Credit card interest rates r higher. So maybe the elderly would like their stuff safe and borrow money against there gold on the spot while its at $1200. The highest it's ever been. They r elderly, retired, and r struggling now more than ever to live in NYC. This pawnshop things is not a bad idea.

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  4. ALL I NEED RIGHT NOW IS SOME CHICKEN WINGS SOME FRIES AND A NICE COLD 45

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  5. That laundromat is the best in the neighborhood and in no way complicit in any of this. If the community boycotted that place they'd be shooting themselves in the foot. (Have you BEEN to the other laundromats on Franklin?!)

    Wait, what am I talking about? That laundromat is so good it gets really packed sometimes, so it would be nice if a few hot-heads boycotted so others could get at the machines. :)

    -danny

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  6. (Just to be clear the first three posts are from the same person)

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  7. While this battle might be a loss, I can definitely see a big win in the long run if community members make it clear to landlords that we don't want just any business opening in this community. It's changing and constantly improving. Landlords and residents(renters and owners) need to protect the investments they've made in this community and that includes paying attention to who leases commercial space.

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  8. It is really obvious that those first three comments are from the same person pretending to be different people. Something tells me he/she is probably involved with the pawn shop. I know they have been reading the blogs. Wouldn't surprise me if they pretend to be innocent locals who would just LOVE a new pawn shop!

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  9. "Bob" may talk about the legitimacy of his operations, but he is distorting facts when he speaks. It's most likely Bob who posted the first 3 comments on this post, that's his style of manipulation. Regardless, even the best run pawn shops are VERY bad for neighborhoods. Not only do they encourage crime, they also prey on those in our community who are dealing with financial struggles. Loans given by pawn shops are horrible, the terms are abusive.

    There is no doubt whatsoever that the laundromat and pawn shop are both owned by the same business partners. This is fact. As clean and convenient as the laundromat is, you should not be supporting them with your business. Supporting the laundromat = supporting the pawn shop. It's really that simple. The laundromat needs to be boycotted. Your dollars are your votes, please use them wisely. PLEASE take the extra effort and do your laundry elsewhere. Crown Heights can NOT afford to have this pawn shop in our neighborhood, please do your part in stopping such a horrendous addition to our lovely community.

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  10. The sign was just taken down!

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  11. I'd like to say that the Spanish folks who run the laundromat are soooo nice! It'd be unfortunate to have to patronize that another place because of "just business."

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  12. Why is it clear that the laundromat and the pawn shop are the same business? Even it's the same landlords, I don't know why we'd lump the businesses together?

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  13. the pawn shop is moveing to franklin ave and close to eastren parkway right wher the police tower is i feel much better now but still not happy

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  14. Anonymous at 11:16 -- where did you hear that?

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  15. police officer on foot patrol has said that the pawn shop will open on franklin ave 1 block off eastern parkway you should see the signs go up this week or next week i hope is not true can anyone find out lets us know

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  16. This is a new to me. I spoke with Eugene aka Bob on Saturday. He states this is the first time he actually walked Franklin Ave.to Eastern Pkwy; he states had he did his own research, he would have chosen Franklin towards Lincoln pl and st. johns because there is more foot traffic, but i already put my money in this place here on Park Pl. Do we really know what these guys are doing? They will say anything.

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  17. Get over it ppl the pawn shop is great for any community, so all u rich snobby ppl that are well off should shut there mouths beacuase they have no idea what paycheck to paycheck struggling is like all they do is call mommy or daddy. Welcome to the real world pawn shops are needed!

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  18. Pawnshop is business for people who can get financial assistance whenever they needed. Not only for jewelries but can also be for important stuff that can be resale or deposit. Pawnshop business can attribute to the needs of people when it comes to financial.



    Jojo @ Pawn Shop Websites

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