The House of Representatives Dec. 8 passed the GOLD Act, a new law that targets mail order gold trade-in companies like Cash4Gold.
The GOLD Act, which was approved by a 324–81 vote, requires the seller’s acceptance of an offer before the transaction is complete, and would issue fines to companies that melt down a consumer’s gold before an offer is accepted.
It also mandates that companies insure returned jewelry at the same monetary value as the consumer originally insured it.
Cash4Gold was accused in a class-action lawsuit of melting down customers’ items before they had a chance to accept the company’s offer. The company denied the claim.
In a statement, the bill’s sponsor, Rep. Anthony Weiner (D-Queens and Brooklyn), had harsh words for the company, and called on the Federal Trade Commission to investigate it.
“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.”
Cash4Gold said in a statement it had pushed for legislation in Florida, where it is based.
“Historically, the purchase of jewelry and precious metals from consumers has been regulated and policed by states,” the statement said. “This new national bill appears to override the authority of the states, create additional federal regulation of the private sector and serve as the first federal law to explicitly regulate consumer return policies which also are typically handled at the state and local level. Cash4Gold will continue leading the industry it pioneered, working side-by-side with the law enforcement and regulatory agencies in states all across the country that have already been involved with regulating the mail in gold buying industry.”