New industry scheme designed to regulate the cash-for-gold industry.
The British Jewellers Association (BJA), the National Association of Goldsmiths (NAG) and the National Pawnbroking Association (NPA) have pulled together to launch a voluntary standard that the associations believe will help to regulate the cash for gold industry.
The Gold Standard officially launched last month and already a number of retailers, including Thomas Watt Jewellers, have signed up to the scheme targeted at businesses that offer cash-for-gold services. While not legally binding, the standard requires any retailers signing up to pledge to abide by a set of strict rules, and the scheme carries the tagline “protecting consumers and businesses against the trade in stolen jewellery”.
The Gold Standard asks retailers to make a general pledge about trading responsibly – such as ensuring that any weighing scales used are correctly balanced – but also requires retailers to adopt new practices when buying gold over the counter from consumers that include asking for photographic proof of identity and recording this information along with a name and address for the person. It also states that jewellers should not buy gold from customers under the age of 18 and that all customers should sign a formal disclaimer stating that they are the owner of the gold jewellery being sold and that they give consent for the retailer to hold information on them for three months.
BJA chief executive Simon Rainer believes that these simple additional steps in the transactional process will help to cut crime. At present there are no legal requirements relating to buying in scrap gold, meaning that anyone can walk off the street and successfully trade gold for cash with no questions raised as to where the gold has come from, which has led to the service being used by criminals to swap stolen goods for cash.
Other elements of the Gold Standard charter include pledging to use CCTV in areas where cash for gold transactions are made, scanning jewellery with UV lights to check for watermarks to help identify potentially stolen jewellery and alerting the police should the retailer have any doubts over the origins of the jewellery being traded for cash.
Retailers that sign up to The Gold Standard will be provided with marketing materials such as decal stickers to display in shop windows and a charter listing what the retailer has agreed to in order to be part of The Gold Standard – an act of transparency that should help consumers put faith in Gold Standard retailers. The BJA, NAG and NPA will also host lists of recommended Gold Standard retailers on their websites and the organisations are in the process of launching a consumer marketing campaign to raise awareness of the Gold Standard outwith the trade.
The trio of industry organisations has also been working with the Trading Standards Institute, the National Measurements Office and the Association of Chief Police Officers on The Gold Standard. Each organisation has had an input into the completed charter and will help to promote it in the coming months.
Cash for gold has become a controversial practice as crime rates targeting jewellers and jewellery-wearing consumers have spiked, particularly in the Asian jewellery market. The BJA recently held a seminar to warn Asian jewellers of the dangers associated with selling high caratage jewellery and to advise on security.
However criminal activity has not just come from outside the jewellery industry. In April retailer Gold Buying Centre in Ely, Cambridgeshire, was shut down by police after a man working there was arrested on suspicion of handling stolen goods. Police were alerted after a woman who had her jewellery stolen believed it was being sold in the shop. As well as shutting down the shop and making an arrest police seized a large quantity of jewellery and £475 in cash.
A spokesperson from the Crown Prosectution Service said that while it had no advice guidelines for retailers worried about coming into contact with stolen goods through cash-for-gold schemes, it said that responsible documentation of transactions and ensuring that responsible questions are asked – such the procedures listed in the Gold Standard charter – could help to protect retailers from prosecution.
However, she added that any person caught in possession of stolen goods, whether they know the goods are stolen or not, can potentially be charged with handling stolen goods. It is then up to the prosecution to prove whether the recipient of the goods accepted them honestly or dishonestly.
Breaking the Theft Act 1968 by handling stolen goods can carry a jail sentence of up to 14 years.
This article was taken from the June 2012 issue of Professional Jeweller magazine. To read a digital version of this issue click here.