| 12/10/2009 |
PAWNSHOPS PUTTIN’ ON THE RITZ FOR THE RICH
Upscale shops offer quick money for high-rollers who can’t keep up their images. These brokers run boutiques that deal in Ferraris and fine art.
By David Farrell
Do you dump the Renoir or give up the Bentley?
Sam Gonen sees people torn by torn by this type of decision. They are the elite of Beverly Hills – actors, producers, big tycoons. They have an image to maintain, yet they are squeezed. They can’t quite keep up with the Joneses.
At Gonen’s pawnshop, they solve pressing cash-flow problems by borrowing on their Tiffany lamps, Cartier bracelets or luxury cars. There is never the fuss of a loan application, or a fear of the deal making the tabloids.
“We take Mercedes, Porsches…a lot of Rolls-Royces,” Gonen said, gesturing across a display floor shared by a cherry-red Ferrari and two concert grand pianos, each worth more than $80,000. Gonen led the way to a vault where a gleaming Oscar – circa 1940 – stood next to a box crammed with $150,000 in Rolex watches. The Rolexes, Gonen said, are just one more part of the image game – flaunted during flush times, hocked when the deals and clients cease to materialize.
“If you’re in the business of selling yourself,” he said, “you have to wear a gold ring. You have to have a Rolex. You have to have a nice sports car. And sometimes, if business is not hot, these are the items you’re going to bring in for pawn….There’s not a day that you don’t see somebody famous.”
Gonen won’t name names, but he will say this: His shop – Collateral Lender, which opened five years ago – is part of a trend toward elite pawnshops that first emerged in the economic doldrums of the late 1980s. The number of licensed pawnbrokers in Beverly Hills has doubled to 10 in five years. That rise has been accompanied by a similar increase, from about 60 to 110, in adjoining Los Angeles.
People who once associated pawnshops with usury, con artists and stolen merchandise are rethinking that attitude, in part because the sluggish economy has added urgency to their need for cash. Trade groups and law enforcement agencies have helped shape new laws designed to protect the consumer. New pawnbrokers now must post bonds to assure their solvency, and borrowers who trade collateral for money must also be thumb-printed. One of today’s largest pawn brokerage houses – Cash America International Inc., of Ft. Worth – is even traded on the New York Stock Exchange.
“People think of an old guy with a cigar, and thieves waiting in line – that’s the old idea of a pawnshop,” said Los Angeles Police Detective Billy Heinlein, who heads a seven-member pawnshop detail aimed at curtailing the traffic in stolen goods. “But that’s not the way it is.”
Certainly, there are still crooks and shady deals. Ill-gotten stereos, cameras, guns, watches and diamonds still trickle through pawnshops every day; Heinlein estimated that 1% of items handled by local pawnshops can be shown to be stolen. Shop owners are still accused of cheating on paperwork, making it more difficult for police to trace items.
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