Gold buyers told to close or comply with new state law

Gold buyers told to close or comply with new state law

In the past week, two transient gold buying operations have been found in violation of a new Texas law requiring businesses and individuals to register and obtain proper licenses before they purchase gold and other precious metals.

Both THR & Associates, operating under one of its aliases Mississippi Valley Gold & Silver Refinery from Springfield, Ill.; and Mason and Davis Metals of Percy, Ark. were found by The Examiner to be operating in violation of the new law – a Class B misdemeanor.

Police closed down the THR & Associates show, telling the manager of the event that he could reopen after meeting all of the local and state guidelines.

The interaction between the police and THR representatives was captured on video by a source selling gold to THR as part of an ongoing investigation into the company’s business practices. The company has a history of offering pennies on the dollar for items brought into its events despite promising to pay “Top Dollar.” The 10kt gold necklace sold as officers were closing down the operation had a melt value of about $520 based on the gold price for that day. Additionally, a sterling silver chain and pendant with a melt value of about $20 was also sold. The total amount paid by THR for the the gold and silver pieces was $88.

The Examiner has investigated THR and its affiliated companies for more than two years and highlighted how the company operates by conducting undercover investigations in nine states.

Primarily, the company was in violation of a new law that went into effect on Jan. 1, 2012, requiring all buyers of precious metals to register with the state and obtain a license. Additionally, the companies must provide detailed receipts to the individuals from which they are buying, according to the law. The new law was originally pushed by the Pawn Dealers Association, but lawmakers also received input from several numismatic associations.

THR was also in violation of a city ordinance because none of the people buying precious metals at the Courtyard by Marriott were listed on a license application with the city of Beaumont. Both the state law and the city ordinance have criminal penalties for a Class B misdemeanor that include jail time and civil or administrative penalties or fines.THR & Associates opened its most recent gold buying operation in Beaumont on Tuesday, Jan. 4, using the alias Mississippi Gold and Silver Refinery. The name is similar to another alias – Ohio Valley Gold & Silver Refinery – and the two companies are part of a network of gold buying operations using nearly a dozen assumed names belonging to THR. The embattled company is also known as the Treasure Hunters Roadshow.

Beaumont Police Sgt. Mike Mills said companies cannot operate in Beaumont without having the proper licenses.

“They don’t have any records,” Mills said. “I did some research to see what the ordinance said regarding the city ordinance. I went in and identified myself and explained they had a city permit but the two people inside were not on that permit. I also explained to them that they were in violation of state law and they had to be in compliance with that law, as well.

“I explained to them that they could not buy jewelry or precious metals until they were in compliance. So there is a state violation, as well.”

Mills said that because they claimed to have been given bad information by the police department regarding licensing procedures, he decided not to charge the two THR employees with a crime. However, he said, if they continued operating in violation of the law, he would arrest them.”

On Wednesday, Jan. 11, Mason and Davis Metals was holding two gold buying events – one in Port Arthur at the Hampton Inn and another at the MCM Eleganté Hotel in Beaumont. The company’s representative offered $200 for a similar gold chain that had a melt value of about $554. It was also discovered that the scale being used at the Beaumont location was not certified by the state, which is a separate violation. However, Mason and Davis did attempt to correct the problem.

When Mason and Davis Metals was told it was violating the law, Paul Mason, the co-owner of the company immediately applied for a license from the Texas Department of Public Safety. The company is now listed as being in compliance, according to the state’s public database of precious metals buyers. He is also contacting the Texas Department of Agriculture to have all of his scales certified.

“You have just educated us,” Mason said when asked about why his company wasn’t in compliance. “We tried to check and make sure that we were doing everything right. You can only go on what information you have. What we are going to try to not do is shut down. We just found out about this new law, and we want to be in compliance.”

EDITOR’S NOTE: The Examiner will publish an in-depth article on the new law and how it affects not only transient buyers but local jewelry stores and pawn shops in an upcoming edition.

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Comments

Yes

This is not about protecting consumers. The Pawn shops involved in usury are doing this in every state to shut down competition from smaller shops. Its time to unite and shut down the pawn shops for good. The medieval period is over. They should go. The Roadshows are not very good either, but people can mystery shop them and expose their garbage tactics.

Scam

These laws are put into effect and backed by pawn brokers money They are using the system as personal grunts to eliminate anyone who threatens there bottom line. Its kind of like the cops laws and regulations are put in place to hold back the small guy starting from scratch.

It is very important to check

It is very important to check all local and state laws. We learned of the situation as we were engaged in gold buying operations. We were told by the Beaumont city hall that all we needed was a city permit, which we had and displayed. Just prior to our setting up the state of Texas passed new legislation as to registering in their data base. We were not aware of it until the Examiners represenative educated us to this fact. We very quickly made application and were in compliance. Also our scales were certified in Arkansas and we thought they were ok. However, we also learned that each state may have you to certify within their particular state. As to offers, and this is very important, they will be low (primarily because we are searching for a good deal with our money as would be any good shopper) but we start a low offering and will negotiate up . Our philosophy is pay as little as possible but as much as you have to. We do not hide behind any elusive name, that is why our name and purpose is in our title Mason and Davis Metals. We are not taking advantage of people, in fact our ad says, take your items to others first and then bring them to us. 9 out of 10 will sell to us. The practice of gold buyers roadshows is for people to liquidate their goods for much needed cash in a hard economy. We have to pay attention to how we buy due to the fact precious metals prices fluctuate. The very bracelet that was described as worth over $500 and we offered $200(which was a starting place) is now worth about $250-$300 because the price of metals has dropped severely in the last two years. This ad so good in that it holds us to a standard, but unfair as it paints gold buyers as transient thieves. I am a Christian minister and treat the rich and poor the same. One last thing to consider is that we stimulate the economy more than any other competitor. We pay large sums of money for an ad campaign, we rent hotels that cost many times higher than fixed premises, we buy permits and licenses, we patronize local restaurants and provide cash to those who choose to sell to us. We are speculators who expect that what we do for all the money spent is that we make a profit. I promise you it is very small after the expenses are paid. To put it plainly...most newspapers make more than we do. So who is really making the money? Your community.

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