Friday, March 6th, 2015

New Regulations to Prevent Fencing at “Cash for Gold” Stores

The rise in popularity of precious metal resale stores, often known as Cash for Gold stores, over the last several years created a new problem for law enforcement officials seeking to trace and stop the fencing or resale of stolen goods. While Cash for Gold stores operate in many of the same ways as pawn shops, they were not regulated similarly. Most notably, there had been no requirement that Cash for Gold stores keep records of precious metal purchases from their customers. In turn, this made it easier for criminals to fence stolen jewelry at Cash for Gold stores and more difficult for law enforcement agencies to identify the parties involved. To combat this, the Illinois Legislature passed Public Act 098-1096 entitled “The Resale Dealers Act” which went into effect on January 1, 2015, and has created new regulations relating to the Cash for Gold industry in Illinois.

The new law requires all “resale dealers,” a term which specifically includes “Cash for Gold” operators, to keep a detailed record of “all goods, articles, and other things purchased or received by the resale dealer from any source.” Additionally, the resale dealer will need to keep a record of the time of purchase, obtain identification from customers — which they must record — and keep formal records of the transactions. The law also requires daily reporting procedures to local law enforcement, establishes holding periods before goods may be resold, melted or transferred, and outlines the methods by which government officials can inspect suspected stolen goods. While home rule communities may not create any regulations that are less restrictive than required by this Act, the Act specifically contemplates that more restrictive regulations may be imposed locally including a requirement that Cash for Gold shops videotape their businesses.

The law was prepared in consultation with police and sheriff’s officials. If your police department has been struggling with this issue, this may offer an additional useful enforcement tool and should, hopefully, plug the gap created by the different regulation of pawn sales and cash for gold sales that existed before the law was passed.


Ruth Alderman Schlossberg

Author: Ruth A. Schlossberg