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Fools and Their Money - What TV Gold Buyers Actually Pay

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In a previous article I laid out the reasons why anyone who gave it a bit of real thought, would easily see that selling gold through some TV mail order dealer was loaded with possible problems.

See: Fools and Their Money - Is Scrap Gold Mail Order a Rip Off?

Some additional points to consider:

If the package is insured, what is the insured value? That's the MOST you will get if it is said to be lost.

scrap gold
On guarantees, consider the terms - for instance, if you have a 7 day money back guarantee, when does the time start counting? From the date on the check? If so, what happens if the check isn't mailed for a few days? And, just how long does it take you to get a letter? Are those 7 "business" days, or do they count sundays and holidays? How do you have to reply to get the guarantee? Do you have to write? Can you phone? If you write, how long will that take to get there, and can you prove when it arrives?

If they guarantee free return "if not satisfied" what happens if they say it wasn't gold in the first place and you have to pay to get it back?

I already covered the question of whether you would have any way of knowing the actual weight of any gold you send.

These "gold" ads aren't just running in the U.S., they have apparently gone "across the pond" so to speak, and, perhaps because they are somehow less tied to TV advertiser money, a U.K. newspaper is reporting actual results from sending gold jewelery to various named companies.

I should point out that you will never get anything like the price you pay for jewelery in a store. As with furniture stores the "list" price is usually several hundred percent higher than the cost to the store - that's how they can run occasional "giant" sales.

I won't keep you in suspense about the results seen in the U.K. Their conclusion about scrap gold TV ads was that they all offered a "shockingly bad value" for the seller.

The Daily Mail's story was based on a study by Which? Money Magazine which accepts no print advertising.

The magazine sent out gold valued in pounds sterling at about 730 pounds.

To get to U.S. dollar value just multiply by 1.6.

One company offered about 39 pounds total for the 730 pounds sterling of scrap gold.

Jewelers and pawn brokers in England did much better but only paid about 10-15%.

Cash4Gold and Money4Gold were among the firms tested.

The worst company was the one which refused to return a gold item postpaid claiming it wasn't gold.

See the actual article for comparative prices which seem to be even less than you can get in the U.S. but I think they were based on retail jewelery store cost - it wasn't clear.

What was clear was that local jewelery stores and pawn shops paid much more than the scrap gold by mail businesses.

You can read some consumer complaints at
www.consumeraffairs.com.

My favorite, and perhaps the most sad because it really showed how foolish some people are, was the person who sent a bunch of gold along with 40 U.S. quarters and got less than $4 just for the quarters. The face value buying anything in a store was obviously $10 for 40 quarters. Even worse, if they were older silver quarters then the value would have been closer to $150 for the scrap silver. But even if they were new quarters any bank would have given them a $10 bill.

The Consumerist Web site carries an interesting story and reports that "They have also asked us to remove this story" in reference to a tell-all from a former employee.

Think for yourself. And, remember that the happy looking people seen in most TV ads may look happy because most of them are actors and all of them are getting paid to be on TV. You'd be smiling too.

John McCormick is a reporter, /science/medical columnist and finance and social commentator, with 17,000+ bylined stories. Contact John through NewsBlaze.

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