Goldfinger: a quick buck

DUBLIN City Council has called for the regulation of the 'cash for gold' industry, in a move applauded by consumer groups and the jewellery trade.

As Christmas approaches, politicians and industry leaders have remarked on the ease with which gold can be disposed of, and the huge growth of the sector.

It is understood that customers of cash for gold shops are routinely paid between €5 and €6 per gram, even though the actual value of gold is closer to €12 per gram.

The council has demanded regulation be introduced to the sector. The move has been vociferously supported by the Consumers' Association of Ireland (CAI) and the Retail Jewellers of Ireland (RJI).

It comes after Labour's Dublin North- East TD Tommy Broughan criticised the government for ignoring the cash for gold industry's possible link to a rise in home burglaries.

"Serious concerns have been raised by constituents and at local community meetings about the proliferation of gold shops and gold trading operations including on-street and door-to-door trading," he said.

More and more cash for gold shops are opening for business as the recession deepens and people look for new ways of raising money.

"They are just mushrooming," said west Dublin councillor Brid Smith, who has instigated a national approach to regulation.

"You can walk in with no evidence of who you are, what age you are, the goods that you are selling, or if they're yours.

"The problem is that these shops can be used to launder stolen jewellery. Women have come up to me and said my house was broken into and they took nothing but my jewellery and it's in that shop around the corner."

Many regular jewellers either won't buy gold or will only do so from people they know.

According to sources, some are beginning to offer the market price to customers as a form of 'trade in'. Customers are paid with a credit note which serves to deliver the real value and to discourage those attempting to shift stolen property.

Dermot Jewell of the CAI said his organisation was getting calls from consumers concerned over whether or not they were paid the correct price for their gold, and if the shop they attended was regulated or linked to criminal elements.

"They are still growing and they will be everywhere from what I am picking up, right around the country," said Jewell.

"To have the industry regulated to some degree is positive. It would be important to understand what happens to the industry in the second tier – if someone buys it, are they going to melt it down or are they going to sell it on? That is where clarification is needed.

"Who is funding this in the background [has to be addressed]."

The RJI's Tony Cahill agreed: "I think [the industry] contributes to an increase in crime and it needs to be monitored more."