Beware of Gold Buyers

I want to share a recent experience that confirmed my fears regarding the flood of people suddenly buying gold, silver and platinum by convincing people to bring in their old jewelry and precious metal items.

Let me start by saying there are honest people doing this, but I think many if not most are taking advantage of people and even lying to them.

How this started is my wife is wanting to have a custom ring created for a special stone. She asked me if she could gather up jewelry we have and other precious metal items and sell them for the money to pay for it. We have a few rings and other items we never wear and keep because of the precious metals value.

I was skeptical of the buyers and had her take part in an experiment with me to find out if they are in fact ripping people off.

I sent her out with an 18 karat gold band, a heavy platinum band and a one ounce silver coin (one of a few dozen I bought years ago). I picked the items because I knew exactly what they were and that there would be no issue with authenticity or the amount of precious metal they contained. I wanted to see how honest the buyers would be.

She started with a local buyer that advertises often and I've seen featured recently in a news story about how busy they were. A general fluff piece that was more of an advertisement, but presented as a news story.

This company, supposedly the safest one to deal with lied to her from the second she entered the store. They lied about the amount of gold in the band. They told her the Platinum band was in fact Silver. They told her the one ounce Silver coin was not Silver. Then they offered her $70 if she gave them all three items.

The second location lied also. This one told her that none of the items were real, but they would give her $20.

The third location was completely honest and offered her a reasonable price of just under $700 after confirming the items were genuine and calculating their value for the metal in them. The offer worked out to around 80% of spot on the metals, which is better than I expected.

Since the first location is where most people go, I can't help but wonder how many people they have screwed over.

People, be very, very careful if you sell to these folks. It took us three try's to find an honest buyer. It also turned out the one I thought I could trust was very dishonest, while a local guy doing it on the side was completely honest and paid more than I expected.

Now you have a story to go to the same news station with.

After their fluff piece, I think it's time for your own little piece of news to be aired on the same station.

Peace

reply to post by Blaine91555


I will be honest with you here... I'm absolutely shocked that there would be anyone she went to that was being straight with you/her. I honestly assumed they would all be the same... Crooked. They take people for morons, but unfortunately the majority of the jewelery brought to them is probably stolen anyway. So the "owners" aren't generally aware of the true value of the items brought in.

You definitely need to tread carefully. Seller beware.

Yes go to the news!! We have a station here, three on your side that investigates stories like this. I hate when people get ripped off!

reply to post by Blaine91555

There needs to be a secret customer style monitoring of this industry.
Where people go in pretending to be customers to see if they give a genuine valuation and somehow punish them if they don't.

I am assuming the gem industry doesn't have much regulation at all and that is hardly surprising considering who some of its big players are.

Thanks heaps for you advice OP.
It does pay to shop around as your wife found out.

I took a gold chain to one of these places to do the same. It was custom made, and I knew the exact weight inside. Even at scrap rates they were 30% lower than what was market price.

He looked mad when I told him I was just curious, he thought he hit a "gold mine".



But yes, Gold goes up in value and the vultures come out eat.

reply to post by hhcore


You're a bit more jaded than I am. I have no doubt there are many honest people out there to deal with. People just need to be careful and pay attention. Know what you have in your hand when you walk in. Nobody can take advantage of you unless you let them do it.

reply to post by amatrine


If I do that, I'll go directly to the AG's office. I've been involved in that before and if you can prove a pattern, they will represent you. The media depends on who's pocket they are in.

reply to post by boncho


Reread and I'd misunderstood. Sorry

I usually confront them right then and there and ask them point blank if they try to rip everyone off like this. Need to get it on video.

I completely agree!

The majority of these gold buyers are complete scammers. It's kind of like going into a sleazy pawn shop. I can see paying 70% of market value as a type of 'brokerage fee'.

But what gets me is that these crooks try blatantly lying by saying the metals are not authentic and going ahead to try ripping off the unsuspecting; trying to pay 5-30% of the actual value of said metal. I'm sure they are very successful. You have to be very selective in who you trust to broker your goods. (auctions always work)

Just imagine if you went to the antique road show for an appraisal and you had an Honus Wagner cigar card and some lowlife said it's worth $30,000 to grandma. But you know what...? I'll buy it for 35,000 to be nice. She thinks she hit the jackpot for a baseball card but gets ripped off the tune of $800,000. Now how credible would antique road show be?



Sellers beware.

I have got the best prices listing honestly on ebay.
I test my items first and state that.
I weigh everything with jewelry scales.

This would be a nice hidden camera piece. A tip to the local investigative reporter perhaps? They're always looking for stories to make their name.

OP, you sound surprised? Ever try trading in a car and getting the famous low ball offer? They always start with some off-the-wall low ball price because they want to negotiate. Good thing your wife walked away from the guys trying to get something for nothing.

I would have haggled with the guys for the fun of it. Try to waste as much of their time as mine, and make them think a deal is about to be made. Tell them you have changed your mind at the time they think the deal is in the bag. There are a bunch of crooks out there, and they are found at these precious metal buy back places. No different than what one finds at a used car dealership or a pawn shop.

If people want a little ammo before giving up their precious metals and gems? Perhaps it is a good idea to visit a professional appraiser, jeweler, or gemologist? Get their appraisal and estimate in writing. It should help when trying to negotiate a price of sale. As the saying goes, "A fool and his money soon parted."

Not sure how it is in US but I'd expect there to be some law that would say that lying in such instances is illegal. Fraud or some such law. They are knowingly lying to cut prices in the case of the OP.

My dad has a mini gold bar that weighs about 10 grams or so and its stamped 14k and he took it in to see what he could get from money mart and they offered him 90$. I would never ever sell my gold or silver to these scams and I am glad my dad even realized they were trying to rip him off. I figure its worth at least 500$ ?

reply to post by Jakes51


The problem is that here, even the "professional" appraisers at the jewelry store are crooks. They will lowball appraisals at 30% of value.

I tried a thread on this a few months back and for some reason it got tossed to the trash bin, I will agree with everything you said and then some here.


I bought an ounce of pure unrefined gold right out of the ground from Australia about 16 years ago for about 300 dollars Canadian.

I just happened to make contact with this guy on a chat site and after about a year of him talking about going out to the country to get nuggets I asked if I could possibly buy some.

I did and I was happy, beautiful real nuggets, years later we get a new neighbour who just happens to be a jewler and I told him about our gold.

He said straight out to us that we were probably scammed and let me test it in my shop.
We are cool with that and good thing too, he came back and told us this gold was off of his highest scale reading.

It does have some red soil embedded in it but he more or less said it is the purest gold he has ever tested.

I wonder what a consumer digging gold company would have told us here?

Bloody crooks and I mean all of those people who advertise to bring in our precious metals.

Good thread and S&F

Regards, Iwinder