ConsumerWatch: Who Pays The Most For Scrap Gold?

SAN FRANCISCO (CBS 5) — With the price of gold at an all-time high, it seems everyone is offering to buy. With jewelry stores, pawnshops and even mail based operations such as Cash for Gold wanting your scrap gold, who is really paying the most?

CBS 5 ConsumerWatch went undercover to find out. We offered to sell a 24 karat chain, an 18 karat gold band and a 14 karat omega necklace.

To determine exactly how much it’s all worth, CBS 5 took it to the source: a commercial gold refinery. They can’t buy gold from you, so they opted not be on camera. But this is where licensed retailers, who buy your gold, get paid.

“The Melt” is the term used to account for how much gold the pieces produce once they are melted down. According to the refinery, our gold is worth $1,320. But experts said we should only expect to get between 40 and 80 percent of that.

Our first stop was Van Mardirosian, a licensed jeweler in San Francisco. He offered $852 for our gold, which is about 65 percent of the value of the pure gold, and a pretty good offer according to our experts.

Next, CBS 5 ConsumerWatch took our hidden camera to the Southland Mall in Hayward. The buyer at the Jewel Time kiosk said he would give us a good deal. He offered $775, which is about 58 percent of the “melt,” which experts say is still not a bad deal.

Just a few feet away was the Gold Rush kiosk. They offered $549, or 41 percent of the melt. The clerk offered to give something extra, but he would not disclose the bonus unless we agreed to sell.

ConsumerWatch then went to Fremont, where a company called Secured Gold Buyers was holding a gold buying event. After weighing and examining our pieces, the appraiser said the gold chain wasn’t real gold. Ironically it was the only 24 karat piece we had.

She offered $221 for the other pieces, plus an extra 10 percent because we had a newspaper coupon. The total was $241, or 41 percent of the melt.

Our lowest offer came from a pawnshop in Oakland, where the appraiser said there wasn’t much market for our prices. He offered $265 for all three, just 20 percent of the gold’s value.

To get the best price, you have to shop around. When you do, ask what percentage of “the melt” you are getting. And to start with a trusted jeweler, that way, you’ll know what you have and which offer is good as gold.

(© CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

  • Richardq

    Yet another news media story without complete research! A search of the internet would have revealed plenty of gold refineries that will offer 90% or more for the “melt”. I regularly do business with Midwest Refineries in Waterford, Michigan who is currently offering 95%! No, you don’t have to be a jeweler to send your stuff to them, just be sure to have it insured for at least the melt value.

  • ShariM

    A pretty good news story, however there was one source or buyer that you didn’t mention or contact. Your local coin shops also buy gold. They pay a fair price as well and should have been mentioned in order to give everyone a fair chance. Many of these “gold buying events” are run by companies from out of town or even out of state. Do they pay any type of state or local taxes or fees to do business here? Your local coin shop, jewelry store, etc does, and can always be contacted if there is a question as to the legitimacy of the transaction. These “here today and gone tomorrow” buyers can be a good resource for the local unsavory folks who need to dump gold that they may have not gotten legitimately. Your local store can provide follow-up to folks who have been victimized as well as to local authorities. Many people are taken in by the large, often multi-page newspaper ads run by these “gold buyers” and are probably not getting the best value for their gold. These companies also often mention in their ads that they buy silver coin, jewelry and sterling silver flatware, service sets, etc. they pay as little as they can get away with. Has there been any type of investigation into the legitimacy of these “here today and gone tomorrow gold buyers” that frequent the area hotels? Are they legitimate companies? Do they pay California taxes or county and city taxes or fees?

    We are loyal watchers of KPIX 5 news. We enjoy the stories that you report. This is one that we believe could use some additional research, especially with today’s gold and silver prices.

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