House Passes Weiner’s ‘Gold Guarantee Law’
On Wednesday, The House of Representatives passed the Guarantee of a Legitimate Deal (GOLD) Act, a bill sponsored by Representatve Anthony Weiner, that will crack down on gold-buying companies like Cash4- Gold that cheat customers through deceptive marketing, misleading return policies and low-ball payments.
Earlier this year, with slick Cash4Gold TV commercials dominating the airwaves and telling consumers they can make a quick buck by selling their unwanted jewelry, Weiner called on the Federal Trade Commission to investigate the company after receiving numerous complaints from customers.
“Cash4Gold has used these bad economic times as a golden opportunity to fleece hard working people in need of an extra dollar,” Weiner said. “The passage of this bill is an important step towards giving consumers who want to sell their gold the protections they need.”
The GOLD Act, which passed the House by a vote of 324-81, would: 1) require a seller’s acceptance of an offer before the transaction is complete, 2) issue fines to companies that melt down a consumer’s gold before an offer is accepted; and 3) mandate that companies ensure returned jewelry is insured with the mail delivery company at the same monetary value as the consumer originally insured it.
Weiner’s office found the following:
Consumers Receive a Pittance for their Pendants
Cash4Gold and similar companies paid between 11% - 29% of the day’s market price for gold, while pawn shops paid about 35% - 70%. According to Consumerist.com gold purchasing companies intentionally low-ball offers to customers and then, if a customer complains, increase subsequent offers by claiming they re-assessed the value of the submitted item. Customer service agents are reported to receive a commission for keeping the pay-out low.
Act Fast or Lose Your Watch
Cash4Gold advertises that consumers have 12 days to return the company’s check if the consumer does not want to sell their jewelry. However, in practice, Cash4Gold requires consumers to return the check within 12 days of it being issued, regardless of if the consumer receives the check a few days or a even a week later. This will often leave customers with only a few days to decline the offer from Cash4Gold. Additionally Cash4Gold will only insure your returned item through postal mail up to the value that they appraised it for. This is often only a tenth of the actual value, and less than the customer insured it for when they mailed it in.
Cash4Gold Keeps Jewelry Despite Customer Asking For a Return
Consumerist.com also reported complaints that some customers who refuse the Cash4Gold offer within the return period are told that their item has already been melted down and that the item cannot be returned.