Cash for gold companies are offering shockingly bad value for debt ridden consumers, a Which? Money investigation has found.
Companies that tempt people to sell their unwanted gold, silver and diamond jewellery items in exchange for cash are offering consumers, many of which are badly in debt, terrible value, according to Which?
Which? sent three pieces of brand new gold jewellery to four gold buyers that advertise on TV, plus three independent jewellers and three pawnbrokers. The TV gold buyers consistently gave the worst quotes.
One company, CashMyGold, offered only £38.57 for all three items, yet the jewellery had been purchased new for £729. On average, the TV based companies offered only around 6% of the retail price for the gold, whereas high street jewellers were prepared to pay up to 25% of the new prices.
Another gold merchant, Money4Gold, apparently held a £399 necklace to ransom saying it was “not gold” and demanded a postal order of almost £10 to return it. Interesting to see on the Mony4Gold website that they ‘guarantee to pay you a fair price for your broken, old and unwanted gold, silver and platinum jewellery. If for any reason you are not satisfied with your payment we will return your items including free return shipping.’
The guarantee relates to the payments made by other national TV advertisers and they have a ‘Double “G” Guarantee’ – which says ‘Find a higher price and we’ll double it’.
The cash for gold companies operate via the postal service and Which? was surprised to see that CashMyGold’s special delivery envelope prominently displayed the word “gold”, which is clearly presents a risk of theft. Most of the other companies surveyed also used indiscreet labelling on their envelopes used to send the jewellery items.
In response to this investigation, Which? chief executive, Peter Vicary-Smith, 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.”
Consumers who are struggling with personal finances may wish to consider other forms of debt management or financial advice.