Cash4Gold is nice enough to admit when they were trying to rip you off.
Since I saw the first commercial, I had a feeling that Cash4Gold might be a rip-off. They advertise during late-night cable television programming and on sports radio. This time slot is pretty crowded with what I call "red-flag" advertising. Another hint is that their DBA sounds more like a text message than an actual business name.
So, a little test was in order.
As I've mentioned earlier, I don't have any scrap gold, so I was not really able to determine the strength of their cash offers. You know? How much Cash are we talking about 4 this gold?
|Luckily, someone else had gold.|
Brent K. was also interested in doing a little Gold kit price evaluation, so he gathered up his family fortune of gold scraps and prepared to do some comparison shopping. He had some 14K gold and some 10 karat gold.
Ok, so he was a pirate.
First, he took the pile of gold to a local pawn shop. The pawn shop prices were as follows:
Apparently precious metal items are measured in "Pennyweight" also known as "DWT". The "D" stands for "Penny", actually "Denarius" from the name of a Roman coin, and WT is short for "Weight". One DWT is approximately 1.555 grams.
The pawn shop weighed Brent's gold and let him know that his scrap was about 11 DWT of 14K and 11 DWT of 10K gold.
How much does this gold look like it is worth to you?
The pawn shop prices were as follows:
With these prices, Brent's booty was worth $198.
Brent had initially noted prices on the Cash4Gold site as:
Better, but all any prices had been removed from the Cash4Gold site by the time he was ready to send in his gold.
Cash4Gold operates in a manner similar to GoldKit. They send you an envelope, you send your gold to them in it. They determine the value and cut a check for that amount. If the amount meets your expectations, you cash it. If not, you have 15 days to return the check and get your gold back. Your satisfaction is guaranteed.
He also noticed that Cash4Gold offers a "fast cash" scheme to forego the paper check and deposit their payment directly into your checking account within 24 hours. This setup would be faster, but gold sellers would give up their chance to examine and renegotiate their offer. And that, it turns out, would be a huge mistake for anyone selling gold to Cash4Gold.
Brent did not use the FAST CASH option, he wanted to see what they would offer, and was willing to wait to see how much it was.
The offer check from Cash4Gold arrived, for $60!
Brent called Cash4Gold and immediately and asked for his stuff back. They made a new offer on the phone: $178!
Can you imagine? They covered their smell a little by suggesting that they could manipulate the numbers on their end so that it would look as though he sent in more than he had....suggesting that they were doing HIM a favor by upping his offer to this new, more attractive number.
Unbelievable! Yet... believable. At first I wanted to call this a scam. How can you offer someone one price, then TRIPLE it, and not call the first offer a rip-off?
Consider this conversation:
(pictured here is the original accounting which accompanied the first, $60 check.)
But, looking over their website and documentation, they never claim they will give you what the gold is worth, or that they will make you a fair offer. They just tell you that they will "evaluate it" and that they guarantee you can get your gold back if you aren't satisfied.
Cash4Gold is completely ready and willing to screw you. They are far away (unless you live in Pompano Beach, Florida), casting a big infomercial net across late-night television, trying to snag gold as cheaply as they can from anyone. They don't care if you are insulted by the first offer, because they have a larger offer in their front pocket. A MUCH larger offer, ready to hand over as soon as you turn to exit.
(pictured here is the second, supplimental check for an additional $119)
And gold looks like the perfect product for them to buy. Gold is gold. It doesn't tarnish, or get brittle with age. Gold isn't like baseball cards, where you would have to subjectively judge the quality of each card. And gold isn't like a Camry either. Your used car could have hidden transmission problems, or have been submerged in hurricane Igor. As long as they can tell that you've actually sent them gold, and can determine the caratage. (10K vs. 24K)
So, this is your general warning, when selling gold, or a car, or anything else. If at all possible, know what you are selling. Try to have some kind of idea about what the value of it might be, especially if you are dealing with strangers through the post office. If weighing is a problem, try visiting the Sweet Factory in the mall. Those guys have scales which weigh candy down to the picogram.
And this is my specific warning about Cash4Gold: Get the second offer.
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September 11, 2008.