Cash for Gold? OFT smell something fishy...
I bet virtually no-one noticed the incredibly subtle punning in the headline of 'gold' and 'fish'. Those that did probably thought it was a rubbish pun. You can't win with you sneering gits.
Anyway, what's all this about golf and the Office of Fair Trading (OFT)?
It concerns those TV commercials you will have invariably seen that ask you to send in your unwanted gold in exchange for cash. The OFT have requested information from some of these companies because they have a hunch that they might not be complying with consumer protection legislation.
What the OFT are particularly interested in is their business practices and want them to explain some of the claims they've made in their advertising and on their websites. One thing that sticks out like a sore golden glans is whether consumers' rights to reject an offer for their gold and receive it back are being honoured.
The folks from The OFT have said: "No assumption should be made that any companies involved in gold buying have broken the law".
Juliet Young, a Director in the OFT's Consumer Market Group said: "Buying gold using the postal service is a relatively new business model, and while innovation often brings benefits for consumers, we want to check that the market and businesses operating in it are developing in a way that treats customers fairly."
This move comes on the back of a Which? report which stated that these firms are offering terrible value. One firm offered a paltry £38.57 for the three pieces of new jewellery purchased for £729.
Which? found the TV gold buyers consistently offered the lowest prices, with CashMyGold offering just £38.57 for all three pieces of jewellery, including quoting just £9.64 for a 9 carat bangle that had been bought for £215, and for which an independent jeweller offered £54. In another case, Money4Gold told the Which? researcher that a £399 carat gold necklace was not gold and demanded they paid £10.95 to have it returned.
Basically, these new companies that are advertising on TV are making offers much lower than what is being offered by pawnbrokers and high street jewellers, who paid an average of 25% of the items' retail price.
Peter Vicary-Smith, Which? chief executive, said: “The poor value for money that these TV gold buyers are providing is simply shocking. The cash for gold market is unregulated, and this investigation has raised some serious concerns about the fair treatment of consumers. People should be wary of buyers’ adverts as they could almost certainly get more money for their gold elsewhere.”