Gold Theft and Pawning Increases in the Recession - Sparrow Law Firm

Where there is a will, there is a way. In the down economy, people are turning to sell whatever they don’t need for some extra cash. A lot of times, that happens to be gold. An entire industry of businesses have been started to serve the nationwide cash-for-gold market, further incentivizing people to steal jewelry for a quick pawnshop payday. Gold sales are overwhelming anti-crime recordkeeping requirements originally designed for pawn shops, and police are beginning to take action.

The price for gold is high right now, prompting alarming upticks in the number of burglaries and thefts from state to state. Most cash-for-gold shops are very busy, and big cities are starting to take note. Milwaukee recently passed an ordinance to assist police in spotting stolen jewelry at such shops before it is too late to be recovered. In July, the Milwaukee Common Council passed vote to require all cash-for-gold shops to electronically submit a seller’s name and photo to local authorities, as well as a photo of the items pawned. A similar measure was passed in Maryland last fall, requiring buyers to maintain a fixed location of purchase. Florida has begun requiring mail-in gold-purchasing businesses maintain a seller database readily available to police. It’s feasible North Carolina could soon follow suit.

The modern day gold rush began to pick up momentum back in 2005 when the price of gold began to increase. The price for an ounce made it up to $1,000 last year, and has increased another 20% within the first half of 2010. It is not uncommon to encounter “Cash for Gold” billboards, radio spots, and TV commercials urging individuals to mail in their gold for cash or for the exchange of goods to occur in odd locations like liquor stores or hair salons.

Some cities have seen the number of shops and “gold buying parties” at hotels or in private residences as much as triple in the last two years. The problem is wide-spread. Investigations at six shops in Milwaukee last year uncovered $75,000 in stolen jewelry and fined the shops $64,000 for failing to maintain proper recordkeeping of sellers. Georgia and North Carolina police recently shut down an extensive burglary ring specifically targeting gold and jewelry. The officers caught up with six suspects in Georgia, and at least 30 other individuals are being sought.

Shop employees are required to keep record of information identifying sellers of pawned items to be later entered into police databases, but often that doesn’t happen for weeks. Even with a required holding period placed on the shop, police still aren’t often able to intercept the stolen gold before it gets melted down to make new jewelry or re-sold.

It will be interesting to see if North Carolina state or local governments attempt to pass legislation to abate this specific issue.

Source: The Associated Press “Gold thefts prompt police to monitor sellers” 8/9/10