Yes, pawnshops are heavily regulated by federal, state, local municipality and/or county in which they operate.
In Illinois, the Department of Financial and Professional Regulation, Division of Banking, Pawnbroker Regulation Section (the same regulating body that regulates banks and other financial institutions) oversee the licensing of pawnshops and make sure that the pawning customers are protected from unscrupulous lenders. (See: State of Illinois Department of Financial and Professional Regulation Division of Banking, Pawnbroker Regulation Section )
At the end of each business day, pawnshops are required by law, to send to their local police department or county sheriff, a copy of all the pawn and purchase transactions made.
Pawnshops are also required to check the names of their customers against the “List of Specially Designated Nationals” (SDN List) compiled by the US Treasury Department.