March 18, 1998

 TO:Toronto Emergency & Protective Services Committee

 FROM:Norman Gardner, Chairman

Toronto Police Services Board

 SUBJECT:REQUEST FOR AMENDMENT TO METROPOLITAN TORONTO BY-LAW, SCHEDULE 25 TO BY-LAW NO. 20 -85

 Recommendation:

 It is recommended that, with respect to a policy governing stolen property in pawnbrokers= possession, Metropolitan Toronto By-Law, Schedule 25 to By-Law No. 20 - 85, be amended to include the following:

 -regulating second hand shops

-requiring proper photo identification from clients

-having a minimum age for customers

-strengthen the penalty section for non-compliance with the act

-give officers: search, seizure, and disposition authority for stolen property located at these businesses

 Council Reference/Background History:

 At its meeting on February 26, 1998, the Toronto Police Services Board was in receipt of the following report FEBRUARY 4, 1998 from David J. Boothby, Chief of Police:

  ASUBJECT:POLICY WITH RESPECT TO STOLEN PROPERTY IN PAWNBROKERS' POSSESSION

 RECOMMENDATIONS:THAT the Board approve the adoption of an interim policy pertaining to the treatment of stolen goods found in the possession of pawnbrokers where the original owner of the stolen property requests the return of the property;

 AND THAT the Board seek new legislation to replace the Pawnbroker Act, 1990, R.S.O., c. P.6 and the Metropolitan Toronto By-law, Schedule 25 to By-law No. 20 - 85 that would include: a) regulating second hand shops; b) requiring proper photo identification from clients; c) having a minimum age for customers; d) strengthen the penalty section for non-compliance with the act; and e) give officers: search, seizure, and disposition authority for stolen property located at these businesses.

BACKGROUND:

 In a report to the Board dated November 27, 1996 (Minute #7 refers), Maureen Prinsloo, Chair, alluded to community concerns relating to the retrieval of stolen property from pawn shops and second hands stores where the owner was known. An examination of some cases revealed that victims of property crimes were advised by the police that their stolen property had been located in a pawn shop or second hand store. Reports indicate that victims were also advised that these shops had obtained their stolen property through what were believed to be legitimate business transactions and that the proprietors were willing to return the property once they had been compensated for their expenses. These victims report having been advised that alternatives to recovering their property were to initiate a civil action or pay the outstanding loan. As a result of these concerns, members of the Service have completed an extensive investigation and legal review of these circumstances.

 This review has revealed that the present Service policy in these matters has evolved into the present practise to compensate for serious shortcomings in the applicable legislation. Existing policy has been in existence for over 85 years and there have been seven different legal opinions rendered within the last 18 years all touching on this same issue with all reviews rendering similar opinions. Additionally, there have been several requests from the law enforcement community seeking legislative change.

 Current legislation (provincial legislation for pawnshops and a municipal bylaw for second hand shops) requires the police to inspect and examine the records of these businesses, presumably to identify and secure stolen property. Existing legislation does not, however, provide police with any powers to search for or seize property believed to have been stolen. In order to lawfully seize stolen property the police can either make a seizure with consent or with a search warrant. The Criminal Code does provide police with the option to obtain a search warrant that carries with it the possibility of returning the property, without cost, to the owner. To seize with a search warrant, however, the police must have evidence stronger than mere suspicion, to secure a search warrant. This evidence must be more convincing than just a vague description found on a pawnshop property ledger. Without close scrutiny of property held in these premises by police officers or at the very least, detailed and exact reporting by the proprietors, the ability of the police to recognize and recover property is severely diminished.

 Lacking any strong legislation, innovative police officers have made a faulty system workable by developing a process of seizures with consent. In order to obtain consent to enter these premises to search and seize property, the police and business owners have developed an informal protocol whereby officers are allowed to enter, search for and seize property believed stolen. As a concession, the police agree to secure the proprietors= investment in the property by suggesting property owners pay the Apledge@ or loan made by the shopkeeper. Identifying and seizing stolen property without first obtaining a search warrant also limits the police in their options in the disposal of this property. It should be noted, however, that police officers have great disdain for this Aprotocol@ because, in effect, it transforms these businesses into legalized Afencing@ operations. There is also evidence that unscrupulous shopkeepers are using the system to their advantage.

 Police officers have continued this practise on the premise that with the co-operation of the shopkeepers, thieves are more readily identified. Officers agree this policy does victimize the owner a second time, yet in the absence of any meaningful legislation, the options offered by the Criminal Code to police over 630 pawn shops and second hand stores in the Toronto area, is unreasonable and greatly inhibits police effectiveness. Unfortunately, as the police turn to the Criminal Code to secure stolen property via search warrant, this has driven the movement of stolen property further underground.

 In response to community concerns officers responsible for policing these business have:

 Ceased the informal practise of stolen property seizures/recovery relating to these businesses;

Adopted a policy requiring seizures by either a search warrant or consent with sections 489.1 or 490 of the Criminal Code;

Struck a committee to research and recommend changes to current legislation;

 Establish a network of Divisional officers to investigate property crimes within a local environment conducive to the framework outlined in ABeyond 2000@.

 Establish a committee comprised of property crime investigators and members of Computing and Telecommunications to review the technological support needs to these investigations with the intent to make the necessary recommendations to the Board.

 Due to these short term measures, the process to recover stolen property has been lengthened and complicated, subsequently reducing the effective policing of second hand stores and pawn shops. The only viable long term solution to addressing public concerns as well as the protection of property owners rights would be to amend present laws at the Provincial level to include the aforementioned recommendations into one piece of legislation governing second hand stores and pawn shops.

 Acting Staff Inspector Paul Gottschalk will be in attendance to answer questions, if required.@

 Conclusions:

 The Board approved the following Motions:

 1.THAT, with respect to recommendation no. 1, given that this refers to an operational matter which falls within the jurisdiction of the Chief of Police, the Board receive the recommendation;

 2.THAT the Board approve recommendation no. 2; and

 3.THAT a copy of the foregoing report be provided to the City of Toronto Emergency & Protective ServicesCommittee regarding the changes required to the By-Law and that Service staff attend the meeting when this matter is considered.

 Contact Name and Telephone Number:

 Acting Staff Inspector Paul Gottschalk, Special Investigations Services, Toronto Police Service, telephone no. 808-4413.

 Respectfully submitted,

 Norman Gardner

Chairman

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