Friday, February 06, 2009

Cash4Gold a scam? No way!

Speaking of the Snuggie, the only late-night commercial that seems to run more frequently than the one for the Snuggie is the one for Cash4Gold. In fact, Cash4Gold completely outdid the Snuggie when it ran its own Superbowl ad last weekend. The ad, featuring Ed McMahon and MC Hammer - celebrities whose money woes are well-known - was clearly aimed at folks who are facing money woes of their own in this ever-deteriorating economy. Have some gold jewelry that you don't wear or need anymore? Mail it off, and get the cash that you do need! It's quick and it's easy! Sounds great, right?

Well, no. The very first time I saw that commercial many months ago I thought to myself, "this looks like a scam." Turns out, I was right:

The folks at put Cash4Gold to the test, rounding up a bunch of old rings, necklaces, and earrings, and taking them to a regular pawn shop to be
appraised. The offer: $198 for the lot. They then sent the items to Cash4Gold and waited for a check in the mail. It arrived within a few days as promised... in the amount of 60 bucks. (You don't have to accept the check; the deal isn't done until you cash it.)

That price alone is practically criminal, but that's where the truly slimy part of the operation begins. First, if you call Cash4Gold and ask for your stuff back, you abruptly get a better offer: In the case of the above experiment, the offer was a whopping $178. That's a better deal, but still not market rate, though the caller was told that Cash4Gold could "manipulate the numbers on their end" to make it appear that more product was sent than was in reality. Bizarre, but it's really the only way Cash4Gold can cover its behind to convince you the original offer wasn't a wholesale ripoff.
Here's what I really love about the whole operation: when Cash4Gold got wind of's expose, they tried to bribe them into modifying or deleting it!

Anyway, it's readily appearent that Cash4Gold is a sleazy operation, and I'm not defending them at all. But I do have a few observations:

1. If you send valuable items like gold jewelry through regular mail, you're an idiot. Sorry.

2. If you let the buyer appraise your valuables, the initial offer you're going to get is invariably going to be lowball. It's an underhanded practice, to be sure, but it's also a fact that the buyer wants to buy your goods for as low as possible and turn it around and sell it to someone else for as much as possible. The lower a price they can sucker you into accepting, the more money they make. Don't accept the first offer. Better yet, get your valuables independently appraised before you sell them.

3. What's wrong with actually going to a jeweler in order to appraise or sell your valuables in the first place? Have we, as a society, become so adverse to human interaction that we would rather ship our gold off to some anonymous company than to actually conduct business the old-fashioned way, face-to-face?

It's true that things are difficult for a lot of people right now and I truly believe that things are going to become much worse before they become better. But if your situation is so desperate that you need to sell your gold heirlooms in order to keep the lights on or the pantry stocked, the least you can do is get as much value as you can for them. Do business with a reputable local jeweler, and don't get scammed by a company that runs cheesy advertisements on late-night TV.

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