Gold Parties: Be Careful, No Such Thing As Unwanted Gold
Consumer Protection Commissioner Jerry Farrell Jr.
Commissioner Farrell: Gold Parties Must Comply with Laws (press release)
HARTFORD, November 20 — Department of Consumer Protection Commissioner Jerry Farrell, Jr. warned consumers to be wary of in-home “gold parties” that have become popular around the state over the last month. The “gold party” concept involves a person inviting his or her friends over to their home for a party where they are asked to bring any unwanted gold that they might want to sell.
“It’s nice to gather in someone’s home, have food and drink and socialize, but, if that party also involves potentially selling your gold, consumers need to know important information ahead of time,” Farrell said. He pointed out that consumers need to know:
• State law (Connecticut General Statutes, Section 21-100) requires a person engaged in buying gold to have a license to do so from the local Chief of Police or First Selectman. Depending upon an individual municipality’s interpretation of that law, the homeowner hosting the party may need such a license, as well as the gold dealer themselves.
• The same state law explicitly states that all transactions between the seller and buyer of gold must be by check or money order – NO CASH.
• The scale used at the party must be certified by an authorized metrology lab and the laboratory’s official seal affixed to the scale.
“These parties crop up during bad economic times,” Farrell said. “It may be that you do want to sell your gold but, as with any consumer transaction, go into it with your eyes open and your head filled with relevant information.” Among Farrell’s recommendations are:
• Before going to the party, visit several reputable jewelers or coin stores to see what value they place on your item of jewelry, and what they might be willing to pay you for it.
“We always say to consumers “shop around” to find the best price and that concept applies here too,” the Commissioner said.
• Find out the carat and weight of each item of your jewelry.
“Value is going to depend not only on the weight of the item, but also on the carat. Is it 14k, 18k or 24k? Each item you want to sell has to be weighed individually, as different carats will sell at different rates of value,” Farrell said. “Don’t let multiple items of differing carats get weighed together.”
• Look to make sure that the scale used is indeed certified by an authorized metrology lab.
“The measurements of weight involved in gold are much smaller than other kinds of commodities consumers purchase or sell by weight; therefore the scale needs to be extremely accurate, which can only be the case if it has been calibrated recently and a dated seal placed upon it,” Farrell said.
Consumers with questions about gold parties are urged to first of all, call their local Police Department to see if the party organizers have obtained a license, and to call the Department of Consumer Protection at 1-800-842-2649 if they have additional questions or concerns.
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5 Responses for “Gold Parties: Be Careful, No Such Thing As Unwanted Gold”
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I agree with Ben and think Brad is off the mark. Many gold buyers use “pennyweight” when quoting a price. However, when you buy gold jewelry the weight is presented in grams. Also, most people who have access to a scale will get the weight in ounces or grams. No layman has a scale that reads in pennyweight. Since there are 1.55 grams to a pennyweight, there is a big difference is someone is quoting a price in grams and another is quoting in pennyweight. So, if a buyer quotes a price of $12.00 per gram for 14k and a sleazier competitor quotes a price of $14.00, but it is actually in pennyweight, that could be a problem.
Also, Brad sounds like he is in the Gold party business. Gold parties are the BIGGEST scam out of all of them. After the “hostess” gets her cut, the “tester” gets his cut, and the party company gets their cut, the seller ends up with a fraction of what they would get elsewhere. Gold parties are an unregulated mess right now.
I would strongly suggest checking out the Silver and Gold Exchange before selling gold or silver to ANYONE. I did a great deal of research, online and offline, and learned a lot about this business. I checked pawn shops, jewelers, “gold parties”, hotel “buying events as well as the online buyers, including the “as seen on tv” guys. I found that the Silver and Gold Exchange paid more than anyone else I could find. I liked the fact that they post the prices they pay per gram (beware of the places that quote in pennyweight/DWT) on a live price chart at http://SilverAndGoldExchange.com I also checked out their Better Business Bureau report and found they have never had a single complaint as opposed to HUNDREDS of complaints some other companies have! I can recommend them 100%
Ben Sounds like an employee of Silver and gold exchange to me.. beware of pennyweight pricing? Give me a break, IF the firm is pricing and weighing for DWT there is NO difference in final payments.. While there are indeed firms out there that will prey on people in hard times, the majority of reputable firms far out number those scam artists..
At home gold parties, for the most part, offer a relaxed atmosphere and IF the host does there homework and checks out their reputation everything should be fine. Last but certainly not least, by a firm paying by check allows that company to track and pay taxes needed to governmental agencies.
Firms paying CASH in hotels, stores etc. is a great way to launder money and make it clean…
Please Ben; make sure you know what you are talking about before spouting off. Gold can be weighed in many ways. Two of those ways are grams and pennyweight. Most refiners will pay according to pennyweight which is why often it is purchased that way. It is a ligitimate form of weight and payment method. If someone has a scale that weighs in Pennyweight they most likelywill be able to give the customer a weight in grams as well. Either way the customer will end up with the same offer if the person who is purchasing is a honest ligitimate business person. Please also remember it’s a free market and one can offer whatever they like, so it is best to do some homework.