Pawn Shops That Buy, But Don't Sell

... wouldn't a (pawn) shop that buys guns, have the same license as any shop that SELLS guns?

They probably don't want to do individual sales and have a gun shop that comes in and buys up what they have.

I’ve seen where they only do online auctions

Maybe its a front for rich anti gunners trying to get guns out of circulation?

C5rider said:

I had been wondering about something and thought I would ask the folks here on the forum. I know that some have worked in pawn shops, and may have a direct insight into my question.
I see several pawn shops that have signs, "We buy guns!" but, they DON'T sell guns. I was curious about this. Could it be that the owner REALLLY likes to collect guns, or do they then sell them through other avenues such as gun shows or shops?
Have you seen this before? I just found it curious...
thanks for any insights.

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We have several stores in our small chain. I manage one of the gun buying/pawning/selling gun shops. We have other stores that for reasons of space don't sell guns but funnel all their out of pawn or sold guns to one of we gun selling stores in the chain that do sell them.

They probably sell to wholesale another party at a profit, especially on guns that were pawned, since hey have little $ in them. A shop where I worked didn't even put higher-end guns in the display cases, since there was little local market for them- they were sold on gunbroker.

C5rider said:

Maybe?

In our state (FL), face-to-face is still an option. Does that mean they don't need FFL to buy (If they don't sell them?)

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It is illegal under federal law to become a "dealer" without an FFL--and the advertising buying and subsequent resale of multiple firearms indicates that the primary purpose is making money. C&R FFL holders can run into that problem as an FBI agent was charged and convicted with using his C&R license to be an illegal dealer of firearms. His spreadsheet where he kept up with the cost basis of his firearms was used as part of the evidence that he was engaged in firearms trading to make money as an illegal dealer. Believe the case arose during the Fast and Furious investigation regarding the transfer of a Barrett rifle to a Mexican cartel and his conviction was upheld by a U.S. Court of Appeals.

Buying for the purpose of resale to others also constitutes lying on the form 4473 regarding straw buyers. Once again, there is not a strict definition of either or those terms in the statutes and thus the ATF can selectively prosecute if they choose. A guy in VA was convicted of that because he used his law enforcement discount to buy a Glock and then transferred it to his uncle--a predated reimbursement check from his uncle prior to purchase sealed the guy's fate. Both were legal to own firearms and the transfer took place at the FFL. However, he was charged with not actually being the buyer of the firearm because he intended from the start to transfer to someone else. This one went to the U.S. Supreme Court which affirmed his conviction.

Moral of the story, the laws on this are vague enough that if you want to do this sort of thing without a dealer FFL, then only deal in antique or blackpowder firearms where you only have state laws primarily to worry about. Me, I personally would not sell modern firearms except via consignment through an FFL.

Oh, by the way, there is a forgotten comedy movie about how the Feds operated a "pawn shop" in DC that supposedly was a place to fence stolen goods for thieves. It was a sting operation intended to round up various thieves etc. and it was based on a true story--https://harvardpress.typepad.com/hup_publicity/2016/04/operation-sting-elizabeth-hinton.html. The movie is called Hot Stuff which changes the location and a few other details-- https://www.imdb.com/title/tt0079308/

I'll bet they're doing on-line auctions

Yup On line gun sales have been a booming business lately.
Everyone trying to get a better deal on line than at a brick& mortar store.

You have a much larger target audience. Not everyone coming into a pawn shop is looking to buy a gun but everyone looking on GunBroker is.

There is a pawn shop here (Tulsa) that only sells the cheap junk guns in the store. The nicer stuff is sold via gun shows and gun broker.

Tony

mrmike7189 said:

Yup On line gun sales have been a booming business lately.
Everyone trying to get a better deal on line than at a brick& mortar store.

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I’m at a loss to understand this when you add in the $25 transfer and the $25-40 shipping cost. My experience is that by the time you add in the overhead there aren’t many bargains to be had over just buying in store.

FL-NC said:

guns that were pawned, since hey have little $ in them. A shop where I worked didn't even put higher-end guns in the display cases, since there was little local market for them- they were sold on gunbroker.

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Elkins45 said:

I’m at a loss to understand this when you add in the $25 transfer and the $25-40 shipping cost. My experience is that by the time you add in the overhead there aren’t many bargains to be had over just buying in store.

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People just don't do the math. Or, with some weird way of thinking, "If I buy it online I don't have to pay sales tax!"

A lot of the pawn shops in my area buy a lot of guns, sell very few locally, and sell A LOT online via gunbroker. In talking with the owner his experience is he can get 50% or more on average online then selling in the store.

We had 4 pawn shops at one point. We only sold guns at 2 of them. Any guns that came out of pawn or that were purchased at the stores that did not sell guns were transferred to the stores that did sell guns. The decision had to do with the economic areas of each of the stores.

Surprisingly, we didn't have a lot of guns come out for sale, though we made loans on lots of guns. Our major profit from guns was in loan interest. We rarely purchased them outright.

No pawn shops in CA can sell guns unless they are on dreaded Roster. They sell them off to out of state buyers.

FlSwampRat said:

People just don't do the math. Or, with some weird way of thinking, "If I buy it online I don't have to pay sales tax!"

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In Cali, the FFL who receives the gun for you is required to add the Cali sales tax (which is now up to something like 10%) on the sales price to the transfer fee, which in L.A. runs $75. Plus there is some other fee I forget now.

Elkins45 said:

I’m at a loss to understand this when you add in the $25 transfer and the $25-40 shipping cost. My experience is that by the time you add in the overhead there aren’t many bargains to be had over just buying in store.

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If you’re buying a new Glock or something that’s currently produced in huge numbers, sure.

BUT... if you’re looking for something very specific you’re much likely to find it online than locally. At that point getting the best deal, transfer fees, etc are irrelevant (within reason).

Maybe they turn the guns in to the police because the owners are anti-gunners.

FlSwampRat said:

We have several stores in our small chain. I manage one of the gun buying/pawning/selling gun shops. We have other stores that for reasons of space don't sell guns but funnel all their out of pawn or sold guns to one of we gun selling stores in the chain that do sell them.

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We have a similar chain locally. Any of their branches will buy, but all displays and sales are conducted at one location.