

Louisiana Makes It Illegal To Use Cash For Secondhand Sales - nextparadigms
http://www.techdirt.com/articles/20111019/17424316421/louisiana-makes-it-illegal-to-use-cash-secondhand-sales.shtml

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tzs
Several comments here have mentioned that this applies to pawn shops. It does
not. The bill explicitly exempts them from the cash requirement. It's a little
hard to notice, because it basically says something like "the provisions of
section X do not apply to dealers operating under Y". Y is an existing section
of Louisiana law that covers pawn shops, and X is the section of the new law
that imposes the cash restriction.

This bill, like many, is written as a list of edits to apply to the existing
law. If you don't read the existing law, you can get a very misleading idea of
what the bill does. For example, there's one place where the existing law has
a list of 4 categories of exceptions to the reporting requirements. The new
bill modifies one of them, and adds a fifth. The other 3 are unchanged, and so
are not mentioned at all in the bill, and remain in effect. Someone who
doesn't read the original law might get the impression that there are only 3
exceptions in the list of exceptions (although the fact that they are numbered
1 and 5 hopefully would tip most people off...)

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ajkessler
This is pretty clearly targeted at meth heads, auto thief rings, and the mob
(there's a mob in LA?). It basically says if you're running any kind of scrap
metal yard, auto yard or dealer, pawn shop, or similar business where you buy
high value items from anybody who walks in off the street, stop giving people
cash so we can track them down.

The law's so poorly written and overbroad (i.e. the definition of "junk" is
"junk"; a single garage sale would seem to subject you to liability) that,
even if it's legal for a state to ban the use of cash (almost certainly not),
this thing will get thrown out anyway.

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bradleyland
I don't know if the issue is as prolific in LA as it is here in Florida, but
we're experiencing a _huge_ number of thefts of air-conditioning "cores". The
thief hits a sub-division that is largely vacant, pops the top off the A/C
system, cuts the tubing and removes the largely-copper condenser coil. The
thief then sells a truck load of these cores to a scrapyard for around $100
each. The owner of the unit is faced with a couple thousand dollars in repair
bills. Thieves in this area have honed their core-lifting skills on unoccupied
residential areas, and have moved on to hitting commercial properties late at
night when no one is around to hear them. There were 7 homes hit in our
neighborhood in the last 3 months, and at least one commercial business that
made the papers because of the exorbitant cost of replacement ($15k).

There's a lot of pressure growing to enact policies that make it harder to
traffic in the stolen materials, as well as providing a means to track down
the sellers. This smells like the same thing.

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ajkessler
I'm sure FL experienced this as well, but for the past few years, as
foreclosures have left whole neighborhoods vacant in parts of CA, NV and AZ,
people have been coming through and just ripping copper piping straight out of
the walls. Thousands of dollars in damage for a couple dollars worth of scrap
metal.

And I was kidding about the meth head thing. Last time I was up in Portland,
they were doing a bunch of work on the railroad. Some guys had ripped out all
the ties along a half mile stretch of the line. _Again_.

Trying to police the source of the cash is smart. It's just probably not going
to fly with this law.

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jshort
<http://legallad.quickanddirtytips.com/legal-tender.aspx> I found this to be
an interesting read. Particularly " In fact, as we discussed in our earlier
episodes, courts in a number of states have dismissed challenges to various
no-cash policies."

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famousactress
If there isn't already solid legal protection from states passing laws like
this, then we ought to consider a constitutional amendment.

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hugh3
The law applies to 'second-hand dealers', and it's not clear whether this term
is defined. Does it only apply to professional second-hand dealers, or to
anybody selling anything?

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ajkessler
It's defined in section 1861:

Every person in this state engaged in the business of buying, selling, trading
in, or otherwise acquiring or disposing of junk or used or secondhand
property, including but not limited to jewelry, silverware, diamonds, precious
metals, ferrous materials, catalytic converters, auto hulks, copper, copper
wire, copper alloy, bronze, zinc, aluminum other than in the form of cans,
stainless steel, nickel alloys, or brass, whether in the form of bars, cable,
ingots, rods, tubing, wire, wire scraps, clamps or connectors, railroad track
materials, water utility materials, furniture, pictures, objects of art,
clothing, mechanic's tools, carpenter's tools, automobile hubcaps, automotive
batteries, automotive sound equipment such as radios, CB radios, stereos,
speakers, cassettes, compact disc players, and similar automotive audio
supplies, used building components, and items defined as cemetery artifacts is
a secondhand dealer. Anyone, other than a nonprofit entity, who buys, sells,
trades in, or otherwise acquires or disposes of junk or used or secondhand
property more frequently than once per month from any other person, other than
a nonprofit entity, shall be deemed as being engaged in the business of a
secondhand dealer.

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hugh3
So (and my eyes glazed over that huge list of objects) the threshold is "more
than once a month"? That sounds... far too broad.

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sehugg
This law will only result in lost tax revenue as dealers keep cash
transactions off of the books. Checks are worthless and there are no free
electronic transfers in the States like in the EU.

Punishing the innocent by offloading law enforcement duties is not a good way
to run a society, it just erodes respect for the law.

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JoeAltmaier
Legal tender is a form of payment, defined by law, which must be accepted by
creditors as payment for debts.

That seems at odds with a law preventing the use of legal tender for certain
transactions.

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mikeash
Most sales don't involve debt, though. The law couldn't prevent you from using
cash to pay off a loan you took out for the item, but it can prevent you from
directly paying cash for the item (I think).

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Symmetry
That is correct. This is why merchants can refuse your business if you want to
pay for something expensive with pennies.

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civilian
No, it's a more fundamental issue: merchants are free to simply refuse your
business. And if you're about to pay in pennies, they'll probably refuse your
business.

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derleth
I doubt that's true if you're in a protected class, as defined by the
appropriate laws.

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pash
Wrong. In the United States, firms cannot refuse to deal with you _because_ of
your race, gender, age, national origin, etc., but they can refuse your
business for any other reason, whether you're in a protected class or not.

In other words, no, our constitution does not require us to accommodate an old
black woman from Jamaica who wants to purchase a Cadillac with her hoard of
five million pennies.

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drallison
United States coins and currency (including Federal reserve notes and
circulating notes of Federal reserve banks and national banks) are legal
tender for all debts, public charges, taxes and dues. Foreign gold or silver
coins are not legal tender for debts. —31 U.S.C. § 5103

It seems unlikely that a prohibition on the use of cash in any transduction is
likely to survive judicial examination.

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torontos
In my reading of this, it's for dealers only - pawnshops and such... in which
case it wouldn't really prevent the thing it's attempting to prevent.

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nobody314159
"more frequently than once per month from any other person, ... shall be
deemed as being engaged in the business of a secondhand dealer."

So more than one Ebay a month and you are a dealer.

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rick888
What about garage sales?

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tzs
There is a list in the law of things it does not apply to. One of them is
"Private residential sales commonly known as 'garage sales' or 'yard sales' as
long as such sales take place at a residential address".

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gte910h
Sounds like they're clamping down on auto theft -> scrap metal rings.

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fleitz
Simply trade the goods for a debt obligation due immediately.

This isn't to catch b&e artists it's to catch people not paying taxes.

