For pawn shops, fake goods are deadly enemies“There are still pawnshops around?”
Ask where you can find a pawnshop these days and that’s the kind of response you’ll get. “Weren’t those around in the 1970s or something?”
Yes they were, and many still are. There’s one in Jongno and others in the posh Cheongdam-dong and Apgujeong areas. Walk through Sinchon and around the corner by the crosswalk in Sillim-dong, and you’ll see a small sign reading Jeondangpo, “pawnshop” in Korean. The old stereotypical images of mothers with babies on their backs trying to sell rings for food or college students hocking dorm objects for money to buy rice wine are long gone.
Pawnshop owners scoff at such stories now. The tearjerker tales are no longer part of the job; everything nowadays is about trying to tell what’s real and what’s fake, and the fake goods keep looking more real.
Fake goods from A to Z
Kang Seung-sik, 36, owner of Cash Park, a pawnshop in Sinchon, says he rolls his eyes when people interested in the pawnshop business visit him occasionally to ask how business is. He says he knows they’ll have second thoughts once he starts telling stories about fake goods.
“Once I tell them how I am stressed out about fake items, they all turn away,” Mr. Kang said.
According to Mr. Kang, some of the fake ones seem more real than the genuine articles.
He mentioned a recent story in the news: A group of scam artists went around to 26 pawnshops in Seoul putting down golden pigs as collateral to borrow over 100 million won ($106,000). The pigs were actually made of lead and coated with gold, but they weighed the same as solid gold and the pawnbrokers fell for it. The scammers were eventually arrested.
“Even professionals like us fell for it,” Mr. Kang said. “We don’t know if the gold is real or not unless we cut it in half. But we can’t do that to every golden good our customers bring us.”
The same goes for designer bags and watches. Some of the Rolex, Cartier, Piaget and Frank Muller look so real that sometimes Mr. Kang can only sigh in appreciation. “I see a person sitting across from me in a subway and I can tell whether their stuff is fake or real,” he said. But he says the story is different when someone is determined to fool a pawnbroker.
“A man brought in a Swiss-made Cartier watch worth probably several million won, and it looked real, felt real and weighed the same as a real one,” he said. “I almost lent him the money, but I turned over the watch and opened the back flap and a part inside read ‘Made in Japan’.” He said he felt sweat break out on his back. He was almost fooled again.
He says nine times out of 10, the person who brought the item in will say the same thing: “I got it as a gift. I didn’t know [it was fake] either.”
Mr. Kang said he decided to change strategies. Instead of becoming angry at customers who bring in forged goods, he quietly studies the items.
“I don’t tell the customers that their goods are fake,” he said. “I see it as a chance for me to study first how fake goods look these days. Then, I tell them that we don’t treat those kind of products.” If customers push the issue, he gives him a more straightforward answer: They are not real, sir.
He says he gives fake goods “grades.” Chinese fakes get Bs, those made in Hong Kong earn As and Taiwanese one are A-plusses.
Pawnbrokers never share their secrets about distinguishing fake goods to other brokers. Being fooled by fake goods, it seems, is the only way to learn; there are no schools that teach the subject.
“A pawnbroker in Gwangju, Gyeonggi province, said he actually paid 2 million won to a watch-store owner to ‘learn’ about Rolex watches,” Mr. Kang said.
Pawnbrokers are used to bizarre inquiries. People will call up and ask, “I have a 250-year-old violin, how much can you pay me?” Some say that they have “30-year-old ginseng liquor.” One of the strangest questions Mr. Kang said he received was from a man who said he wanted to sell the bidding rights to a “nice burial urn.”
The answer in each case was no, because no one could confirm the quality of the item.
A common item in pawnshops these days is a golf bag with a full set of clubs. Men leave their golf bags at the counter and borrow money at the beginning of the week. They then pay back the loan on Friday and go golfing over the weekend. On Monday, they come back to do it all again.
Mr. Kang said he wonders what these men do every week, but a customer’s private life is none of his business.
Prices at pawnshops are set to wholesale figures. For gold, silver and diamonds, pawnbrokers pay 80 to 90 percent of the item’s wholesale price. For cell phones and digital cameras, one can get 60 to 70 percent of the wholesale price, because digital products become outdated within three months of being released on the market.
There are rules for interest rates as well ― pawnbrokers cannot ask for more than the legal monthly interest rate of 5.5 percent.
Stolen goods are another problem. Mr. Kang said that once a woman did not come back to fetch her Cartier watch, nor did she come back to pay him back, so he decided to sell the watch online.
He received a telephone call asking for the serial number of that watch. He told the caller the number. Five minutes later, the police called him. The watch had been stolen during the inquirer’s wedding. Mr. Kang ended up going to the police station to file a report and explain that he was innocent.
Since then, whenever someone brings in a watch, Mr. Kang asks them to try wearing it in front of him. For cameras, he asks them to show him how they take pictures with it. He wants to see whether his customers can use their items naturally, evidence that the goods are not stolen.
Memories behind bars
Jungangsa, a pawnshop in Seodaemun district, central Seoul, still looks homely, much as it did when it opened 25 years ago. Choi Yeong-bae, 57, still works behind barred windows.
“I only feel safe when I’m sitting behind these bars,” Mr. Choi said. “Who knows what might happen to me if I weren’t securely sitting behind these?”
Mr. Choi recalls the 1970s and 1980s as his golden days. “Almost 20 percent of my customers were college students who came to me with electronic calculators and wrist watches,” he said.
It was a time when five people could drink all night on the 15,000 won they borrowed from a pawnshop. His shop was so flooded with customers he had to hire someone to watch his vault at night. These days, he pays 120,000 won a month to a professional security company to watch his safebox.
Mr. Choi said there were “quite a lot” of pawnshops back in those days. From Aheon-dong to Muakjae hills (about 4 kilometers, or 2.5 miles) there were at least eight pawnshops. Now only two are left. On a busy day, three people might visit. He said he doesn’t deal with anything too pricey because he is afraid he won’t be able to tell the real from the fake.
Cash Cash, a pawnshop in Cheongdam-dong, specializes in designer brands, and is one of the youngest shops ― it opened in 2000, when all the others were closing down. The new 330-square-meter (3,500-square-foot) building has no bars to seperate customers from appraisers. The shop’s interior design resembles that of a department store, and it sells goods that its customers either had to give up because they could not pay their rent, or those who want to sell second-hand designer brands. A Brioni suit that sells for 7 million won at a department store sells here for half the price.
“Most of our customers don’t come to us because they need money, but because they want to make money out of their outdated designer goods from their closets,” said an appraiser at Cash Cash. “More than 60 percent of our customers are women who want us to sell their bags or dresses for them.
“Over half of those who come to us to sell their goods come back to us to shop as well,” he added.
He said young people are different these days. “Those over 40 tend to give up buying designer goods if they are too expensive, but those in 20s and 30s are very keen and professional about distinguishing genuine products and they share information online,” he said. “They don’t seem to care whether they are second-hand or new, just as long as they are real.”
A brief history of timepieces
Jang Seong-won, a professor of horology and jewelry at Dong Seoul College, has been a professional appraiser of watches for 35 years. He says he can tell if a watch is fake on sight. He talked to JoongAng Ilbo about the history of “fake watches,” an item pawnshop owners have had to guard against for a long time.
In the early 1970s, a wristwatch was a symbol of success in Korea. Anyone who had one made sure to wear it when they went home for the holidays, especially if the watch had a small calendar, a mark of sophistocation and wealth. For those who couldn’t afford one, they would slip in a strip of paper under the glass with the date printed on it; the only problem was that the date would be correct only twice a year. The most popular brands were domestic ones, particularly those made with imported parts. Digital watches appeared in the market in the early ’80s. No longer did people have to save for months to afford a timepiece; decent watches even became popular wedding gifts. Brands such as “Orient Galaxy,” “Omega” and “Rado” latched themselves onto wrists across Korea, as did imitations from Hong Kong. Those imitations were still crude, however, and easy to spot.
In the early 1990s, more people traveled abroad, as Korea became richer and regulations against foreign travel were relaxed. “Rolex” watches became a common sight, or illusion, depending on one’s income. Soon, imitated versions of Bulgari and Chanel watches showed up on the market, though still sold at high prices. Within the last few years, these fakes have gotten so sophistocated, appraisers need to carefully check the weight and feel of each watch.
Nowadays, the market for watches is divided between real and fake brands. But some designer brands have learned to relax about their imitations. Rolex, for example, do not see spurious versions as subject to control, but as attracting potential customers for their products. For pawnshops, however, a larger market for fake goods means more reason to be careful or lose money.
by Baik Sung-ho