Gold Investing - Cash4Gold Lawsuit

I just finished viewing a video about the class-action lawsuit against Cash4Gold. Whether this lawsuit is successful or not, I think it is good news to bring more attention to the firms that advertise "send us your gold". There have evidently been too many people getting ripped off by some of these firms. Whether Cash4Gold was one, I can only relate my experience.

On my web site, I dedicated a page to my experience selling one piece of scrap gold as a test of how one of these firms works. That firm was Cash4Gold. You can read about it at Sell Scrap Gold

To recap my experience, it took them 12 days and an E-mail from me before they responded. Then I received a check for approximately 14.4% of what the piece (a 10k gold ring) was worth at the time. I said NO. My second E-mail asked for an explanation of their "logic" at which time they offered me 32% of the piece's worth. I said NO. The ring was returned to me 44 days after I had sent it in.

I had heard that Cash4Gold had improved their operation after my experience. Evidently not enough for some customers. Seller beware!

Gold Investing - Karatage System

Karatage is a system of specifying the purity (or fineness) of gold as a fraction of 24 parts. For example, 18 karat gold is 18 parts gold out of 24 parts or 75% gold. Other common karat readings are 10 karats (41.66 % gold), 14 karats (58.33 % gold) and 22 karats (91.67 % gold).

American manufacturers of gold products are required to stamp each gold item with their mark or insignia and the gold content "quality mark" usually expressed in karats. A dirty little secret is the gold purity can be off as much as one-half karat and still be legal. That is, a gold item marked as 18k can actually be 17 1/2k and still meet the letter of the law.

When you sell your scrap gold to a gold company accepting such items they, as well as the refiner they ship the items to, are aware of this leeway in the law. It is also assumed that many if not most American manufacturers of gold products take advantage of this leeway and your buyer will set their buy price accordingly.

If you have traded in your scrap gold for cash and what you received seemed a little low (based on the gold purity of the items you sold), this may be one reason why.