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California Gold Scams On The Rise

March 25, 2009 by Administrator 

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John Asbury for The Press-Enterprise of Riverside writes that gold scams are on the rise in California. Asbury gives one example of how a a woman was approached to buy a gold bar outside a Southern California Wal-Mart, she thought she was getting a bargain. Instead, she ended up with a polished hunk of metal.

As the value of gold soars, law enforcement agencies are warning residents to beware of gold scams and cracking down on unauthorized jewelry sales. The value of gold has been at record levels for much of the past two years, according to the World Gold Council. The increased value in an otherwise dire economy has raised the incentives for making underhanded sales and quick turnarounds on stolen jewelry.

“Most of the time jewelry is stolen, it’s disposed of the same day,” said Moreno Valley police Sgt. Kenneth Paulson.

Police are searching for the man and woman responsible for a gold scam in Murrieta and similar scams in Perris. Outside a Murrieta Wal-Mart last month, police said, a couple conned a shopper out of $5,000 with a fake gold bar.

A woman approached the 26-year-old shopper to ask directions to a jewelry store to sell three gold bars, according to a Murrieta police report. Her partner, posing as a stranger, offered to have the gold appraised at the Wal-Mart jewelry counter, the report stated. The couple returned from the store to tell the Wal-Mart customer the gold bars were worth $12,000 each, but offered to sell her one for $5,000, Murrieta police said.

The bar was brass.

That type of scam is more brazen than sales of stolen gold jewelry that may be occurring at swap meets and pawn shops.

“What’s happening is people are breaking into houses and stealing people’s jewelry,” Moreno Valley police Sgt. Donovan Brooks said. The thieves then try to quickly sell the gold jewelry at places such as swap meets where they can get around regulations meant to stop the sale of stolen goods. Pawn shops are required to document each transaction and keep a thumbprint of the seller with the item on hand for 90 days.

“At these places,” Brooks said, referring to swap meets that often just spring up, “they don’t have to show any record of having possession of the jewelry. They’re circumventing the system.”

Moreno Valley police last month conducted an undercover operation at swap meets, Brooks said. Police made two arrests on suspicion of misdemeanor unlicensed sales. If stolen gold can’t be sold in jewelry form, the metal can be melted down for scrap, pawnbrokers say.

San Bernardino Loan and Jewelry Manager Shawn Pennell said the growing popularity of “gold parties” and traveling gold conventions should raise suspicion. He said people should be concerned about the authenticity of gold sales.

Pennell said he catalogs every piece of jewelry he purchases and files it with a police report. “These places bounce around cities and are here today and gone tomorrow,” he said. “What kind of regulations or safety checks do they have in place?”

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Gold buying parties aren’t necessarily gold scams, but they are something you should know about before attending one–especially since you are likely to get paid much less for your gold in San Diego at a gold buying party. To read about these parties, check out this article: Gold Buying Parties in Vogue.

San Diego Pawn Shops, Gold Buyers, Gold Refineries, & More

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