Sunday, October 16, 2011

Holy cow! Read this!

Louisiana bans cash transactions for 2nd hand goods

By: Thad D. Ackel, Jr. Esq.
This summer, the State Legislature and Governor of Louisiana passed a law that bans individuals and businesses from transacting in cash if they are considered a “secondhand dealer”.  House Bill 195 of the 2011 Regular Session (Act 389) broadly defines a secondhand dealer to include   “… Anyone, other than a non-profit 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 non-profit entity, shall be deemed as being in the business of a secondhand dealer. ” The law then states that “A secondhand dealer shall not enter into any cash transactions in payment for the purchase of junk or used or secondhand property.  Payment shall be made in the form of check, electronic transfers, or money order issued to the seller of the junk or used or secondhand property…”  The broad scope of this definition can essentially encompass everyone; from your local flea market vendors and buyers to a housewife purchasing goods on ebay or craigslist, to a group of guys trading baseball cards, they could all be considered secondhand dealers. Lawmakers in Louisiana have effectively banned its citizens from freely using United States legal tender.
The law goes further to require secondhand dealers to turn over a valuable business asset, namely, their business’ proprietary client information.  For every transaction a secondhand dealer must obtain the seller’s personal information such as their name, address, driver’s license number and the license plate number of the vehicle in which the goods were delivered.  They must also make a detailed description of the item(s) purchased and submit this with the personal identification information of every transaction to the local policing authorities through electronic daily reports.  If a seller cannot or refuses to produce to the secondhand dealer any of the required forms of identification, the secondhand dealer is prohibited from completing the transaction.
This legislation amounts to a public taking of private property without due process or compensation.  Regardless of whether or not the transaction information is connected with, or law enforcement is investigating a crime, individuals and businesses are forced to report routine business activity to the police.  Can law enforcement not accomplish its goal of identifying potential thieves and locating stolen items in a far less intrusive manner?  And of course, there are already laws that prohibit stealing, buying or selling stolen goods, laws that require businesses to account for transactions and laws that penalize individuals and businesses that transact in stolen property. Why does the Louisiana State Legislature need to enact more laws infringing on personal privacy, liberties and freedom?
Motivating the introduction of this legislation was an increase in criminal activity, necessitating law enforcement to develop additional tools in tracking potential criminals. Thefts of copper and other precious metals have risen recently with higher commodity prices and mounting pressures from the economic downturn.  The added restrictions under this recent legislation have come about under the pretense of cracking down on crime and helping the government take care of you, all at the cost of your individual privacy, economic, civil liberty and freedom.
Interestingly enough, although Pawnshops are still required to obtain clients personal information and transmit their client database information to law enforcement, they are exempt from the restriction of cash payments.  A jeweler next door to a pawnshop cannot offer clients the same payment method offered by its competing pawnshop neighbor.
Act 389 passed by unanimous consent of the Louisiana House of Representatives and only mustered one nay vote (Senator Neil Riser) from the State Senate.  The governor signed the legislation into law on July 1, 2011.

Thad D. Ackel, Jr. serves as lead counsel at Ackel & Associates L.L.C. and Broker of Tribute Real Estate.  He may be reached by email @


  1. Hey miss lamb, did it ever seem like some people got entirely to much free time on their hands?

    Reminds me of a few years back. A guy from N.M. revenue came up to me at a swap meet and wanted to see my wholesale certificate, and my tax number.I told him I was selling off some stuff from my garage. He said he had seen me here before and In his opinion I was operating a business. I said when the legislature gives his opinion the weight of the law I'd talk to him again. Ain't that a hoot?

    the mohave rat

  2. What a bunch of about runing people totaly underground for free trade, this should do it very well. Ole George Orwell was a true prophet wasn't he...

  3. You wonder how this effects the ebay crowd, or used book stores.

  4. If this law has been in effect for almost four months already, I'd be interested to know how it's going so far ...from both sides.

  5. HossBoss, I wonder if many second hand shops have gone out of business? If I had a bunch of stuff I wanted to sell to a second hand shop, first---I want cash! Second---They want all that info? What friggin' new bureaucracy is going to keep track of it and who will they share said info with?
    I understand wanting to curtail the theft of copper pipe and other why not just make it pertain to scrap yards and recycling centers?

  6. That might be the most stupid thing I've ever heard of!

    I've sold scrap metal in TX before (junk the old owners left) and they did do all of the things stated in this law: I had to show my ID, they paid me by check from a local bank (where I could go cash it immediately if I wanted) and they did write down the truck info. and license plate on the receipt. That's no big deal, IMO, and if it helps with people stealing metal, then, great.

    All of that has crappola to do with yard sales and Craigslist, though!


  7. Our local Republican county commissioners decided to make it illegal for a gas station to sell gas without prepayment. You know the story. The two guys who own 95% of the stations want to make the two independents make their customers prepay. Free enterprise means he with the most lobbyist wins!


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