SAN FRANCISCO (CBS SF) — A California scrap metal company that failed to take steps to prevent the sale of stolen metal has agreed to pay millions in penalties and change its business practices, prosecutors in San Francisco and Contra Costa counties said Friday.

In a settlement announced Friday by San Francisco District Attorney George Gascon and Contra Costa County District Attorney Mark Peterson, Sims Group USA Corp. will pay $4.1 million in penalties and costs.

The company, which has eight metal recycling facilities in Northern California, will also be bound by a permanent injunction requiring it to follow state laws designed to deter metal thefts.

Scrap metal dealers are required to determine the materials being purchased are not stolen, and must photograph, fingerprint and record the identification of individuals selling certain types of materials. In addition, they must wait three days before paying the seller for the scrap metal.

During an investigation, undercover officers in San Francisco and in Contra Costa County offered to sell the company suspicious items including utility wire, communications wire and public utility fixtures, officials said Friday.

Company employees purchased the items and failed to record the required information.

A review of the company’s records found that Sims had been violating state laws for years by failing to withhold payments for three days or require identification.

Metal theft is a growing problem in California.

“Metal theft threatens the well-being of our infrastructure and costs the community dearly,” Gascon said in a statement. “My office is committed to utilizing all tools necessary to attack the marketplace of stolen metal.”

“California is facing an epidemic of metal theft,” said Peterson. “The economic cost of metal theft cannot be calculated.”

“It is not enough to go after the metal thieves alone,” Peterson added. “Recycling companies must be required to act responsibly because they can deter metal theft.”

(Copyright 2013 by CBS San Francisco and Bay City News Service. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)


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