Back in January 2010, Gold-Traders reported that the Office of Fair Trading had launched an enquiry into the business practices of a number of online Cash for Gold companies.
Yesterday, the results for the enquiry were finally made public. As expected, the OFT have been highly critical over the way some of our competitors operate. Three companies (CashMyGold, Cash4Gold and Postal Gold) have signed undertakings to improve their business practices.
Two other companies who were also under investigation (CashYourGoldNow and Money4Gold) have since ceased trading. The three companies named have undertaken to change a number of practices, including:
- providing people with the option of receiving either a quotation for their gold which requires positive acceptance, or just a payment for their gold, and also displaying both options and the risks of each payment option clearly and prominently
- providing consumers with clear information on other important features of the service, such as whether gemstones are purchased or returned and if the consumer sends a gemstone the risks of damage or loss
- making clear, when referring to the 'high price' or 'top price' paid for gold, that the prices offered to consumers are based on the scrap or smelt value of gold.
Although the three companies named have all signed an undertaking to provide consumers with clear information on the prices offered for gold, we could only find this information on the CashMyGold web site.
At the time of checking, they were offering £5.13 / gram for 9ct gold - that's just 50% of market value, a very poor deal for the customer!
When calling Cash4Gold and Postal Gold, the company representatives refused to disclose what their current price per gram rates were.
Quite rightly the 'Cash for Gold' market has received some bad publicity recently. Unfortunately, there are many companies still trading who are out to make a fast buck and who give customers a very poor deal. Before selecting a company to sell your gold to, please make sure you can make and informed decision.
You need to know what price per gram you're being offered. You also need to know what will happen to the price offered if the gold market rates drop and you need to be aware of any hidden charges or fees you'll be charged. If you have any questions, or have gold to sell, give us a call. We have no hidden fees and our scrap gold prices are always available on this web site.
Link: OFT takes action against gold buying companies
More reading:
- The scam behind the gold buying comparison websites
- The Cash for Gold tricks we think the OFT should be investigating
- British Gold Refinery featured on BBC1’s Rip-Off Britain program
- Why 'cash for gold' companies often fail to deliver
- Company behind CashMyGold.co.uk struck off
- Tesco Gold Exchange
- Tesco Gold Exchange don't recognise 21ct gold
