Pawnshops hives of criminal activity in Ho Chi Minh City: exposé
Wednesday, May 18, 2016, 10:02 GMT+7
A large number of Ho Chi Minh City pawnshops have been labeled ‘backyards’ for criminal activity because of the number of irregularities in their business operations.
There are over 2,500 pawnshops in the southern metropolis, with many alleged to have facilitated criminal activity.
According to police officers, such venues are often the workplace of local loan sharks and used to quickly offload stolen goods.
At around 10:00 pm on May 10, Tuoi Tre (Youth) newspaper reporters approached a shop named LP on Nguyen Duy Trinh Street in District 2, offering a motorcycle as security against a short-term loan.
After a brief look at the bike, the pawnbroker said he could give the undercover journalists VND5 million (US$224), including an interest rate of VND15,000 ($0.7) per day or VND450,000 ($20) a month.
If the deal had been made, the shop owner would have committed two violations of the law, namely accepting assets without legitimate origin and applying an interest rate higher than the general reserve.
Similar scenarios were also observed at pawnshops in Thu Duc District and District 9, with employees agreeing to receive the motorcycle without asking for any certificate of origin in accordance with the law.
A probe carried out by the correspondents revealed that property of uncertain origin was stored in different locations as shop owners were liable to severe punishment if the authorities found out.
When borrowers failed to pay their loans or interest within designated times, the assets would be sold to other people.
Many members of the community have inadvertently purchased stolen goods in this way, given that it is usually made available at a discount.
According to Ch., a pawnbroker in Go Vap District, about 50 percent of his clients never came back for their pawned belongings.
This was due to the fact, he said, that many are either unable to pay their loans, or that the property was obtained through illegal means.
Multiple violations
According to Colonel Nguyen Van Dung, an official at the Ho Chi Minh City Department of Police, a total of 430 violations were committed by pawnbrokers across the city in 2015, with fines recorded at VND1.2 billion ($53,676).
Common offences include accepting collateral without documents of origin or ownership, not recording clients’ information, and storing assets in different locations other than the registered business facility, Col. Dung elaborated.
Some pawnbrokers even run their operations without a legitimate business license, he added.
Police are expected to carry out more regular inspections on the activities of pawnbrokers across the city and will impose stern penalties on violators, the police official said, adding that offenders would be criminally charged depending on the severity of each case.
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In accordance with the Vietnamese law, pawnbrokers are required to make contracts with their clients and take copies of the customers’ ID. Collateral must be presented along with a certificate of origin, and stolen property must be reported to the authorities. Borrowing interest rates should not exceed 4.2 percent per month or 0.3 percent per day. Running an operation without a valid business license or violating regulations on interest rates will result in fines of between VND5 million ($224) and VND15 million ($671). Operators who store collateral obtained by theft, robbery, or scams can be fined up to VND30 million ($1,341) and risk facing from six months to seven years in jail. |
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