“The quality of leadership, more than any other single factor, determines the success or failure of an organization.”

Since 1956, the California Pawnbrokers Association (CAPA; formerly CLSDA) has relied on the commitment of its volunteer Board of Directors to pave the way for others through their leadership and commitment. These volunteer leaders provide our industry with great business knowledge, insight and direction to build a brighter tomorrow.

Nominations are now open for the 2011 CAPA Board Director Election. The available Board positions are for three-year term Board seats.

After reviewing the attached “CAPA Board Member Guidelines”, if you believe you can offer the kind of leadership that will move our industry forward, or if you know of a CAPA member (regular or associate/vendor) who would like to be nominated for a Board position, please use the Official Nomination Form attached to the message or contact Kim at the CAPA office: 209-786-5115, no later than July 16, 2011.

Californians Are Cashing In on a Modern Day Gold Rush

With the price of gold soaring to new record highs, millions of Californians are flocking to gold buying establishments every day in the hopes of making quick cash for their scrap gold and unused jewelry. To meet the demand, cash for gold businesses are cropping up nationwide in unparalleled numbers. However, itʼs important for Americans to do business with a reputable company they can trust.

“There is a growing number of complaints against unregulated cash for gold businesses that donʼt pay the full value for the gold they receive,” explains Diane Taylor, president of the California Pawnbrokers Association. “There are several key things to keep in mind when selecting a regulated, trustworthy establishment that will pay a fair price for your scrap gold.”

For Americans looking to sell gold and other unused jewelry to a safe, dependable gold buying business, the California Pawnbrokers Association suggests sellers ask the following questions before handing over their valuable items to cash for gold businesses:

1. Does the buyer carry a second hand dealers license, which is required by state law for all businesses purchasing precious metals?
2. Does the buyer request a state issued photo ID, passport, Matrícula Consular, or other official government issued identification?
3. Are the scales on which the gold is weighed, tested and certified by the California Department of Food and Agricultureʼs County Office of Weights and Measures, so you can be sure to receive an accurate weight measurement for your gold?
4. Does the buyer report all items received to law enforcement on a regular basis to prevent the acquisition of stolen goods and help reduce theft crimes?
5. Is the buyer trained in metallurgy or gemology with expertise in assessing the quality of gold, silver and other precious metals and stones?

“Getting the most money for your gold is a top priority for sellers. CAPA member pawn shops are licensed and regulated on a local, state, and federal level, including 13 federal laws,” add Taylor. “But many unregulated cash for gold businesses exist, and sellers need to exercise caution.”

“The California Pawnbrokers Association requires all of its members to adhere to a strict Code of Ethics, as well as conform to local, state, and federal regulations. As an example, pawnbrokers are governed under the Gramm-Leach-Bliley Act, which requires financial institutions – companies that offer consumers financial products or services like loans, financial or investment advice, or insurance – to explain their information-sharing practices to their customers and to safeguard sensitive data.”

Taylor points out “Every pawnbroker in the United States must comply with two regulations promulgated by the Federal Trade Commission (FTC) that focus on the privacy and security of information provided by consumers.”

The first of these rules is the Rule Concerning the Privacy of Customer Information (“Privacy Rule”), 16 C.F.R. Part 313, which went into full effect on July 1, 2001. This rule requires pawnbrokers and others who meet the definition of “financial institution” under the Gramm-Leach-Bliley Financial Services Modernization Act of 1999 (GLBA) to provide notices to their consumer customers about their privacy policies and to use and share information only in accordance with the policies they describe in those notices or in the exceptions provided in the rule. Pawnbrokers should be complying with this FTC rule already.

The second rule, entitled “Standards for Safeguarding Customer Information” (“Safeguards Rule”), 16 C.F.R. Part 314, became effective on May 23, 2003. This rule requires that all GLBA “financial institutions” including their service providers who receive customer information from financial institutions have written policies and procedures demonstrating their administrative, technical, and physical safeguards for customer information.

Millions of Californians are flocking to gold buying establishments every day in the hopes of making quick cash for their scrap gold and unused jewelry. Hopeful sellers visit “cash for gold” businesses, attend gold buying events in hotels, and even host gold buying parties in their own homes.

Meanwhile, a growing number of unregulated cash for gold businesses are taking in millions of dollars every year on potentially illegal gold transactions, often circumventing state, local and federal law and evading law enforcement, according to the California Pawnbrokers Association.

According to Diane Taylor, President of the, rogue gold buyers should be a serious concern for Californians. “These gold buying businesses often operate without required secondhand dealers licenses, necessary certifications, and neglect to follow simple procedures required by law such as requesting sellers’ photo identification.” Law enforcement officials, in the US and abroad, believe these unregulated gold transactions are leading to rise in violent crime.

In 2010, police in Pennsylvania and New York reported a rising trend in cash for gold related theft. In the Virgin Islands and the Caribbean, police cited that unregulated cash for gold businesses were responsible for a rise in violent crime. And in an official statement made last October, British Labour MP Katy Clark called for tighter regulations for gold buyers “in order to bring about a reduction in resulting crime.”

Regulated and certified pawnbrokers and secondhand dealers are required to comply with anti-fencing law and regulation, coordinating with law enforcement to track all processed items. These precautions greatly discourage illegal selling, fencing and illegal activity. Rogue companies that buy gold illegally may take in stolen items, which can be scrapped almost immediately, leaving law enforcement officials no recourse on claims of stolen goods or the ability to trace the item to its seller. The potential for criminals to sell stolen items to unregulated gold buyers is substantial. 

California state law requires any businesses involved in purchasing precious metals to obtain a second hand dealers license. Such businesses are also obligated to conduct transactions only on their permanent business premises, hold the scrap gold or jewelry for a 30 day period, request official identification from the seller, and use scales that are tested and certified by the California Department of Food and Agriculture’s County Office of Weights and Measures.  

Californians who sell gold to businesses that fail to comply with regulations run the risk of being mislead about the value of their items. “Representatives of the company may tamper with scales,” warned Diane Taylor, “resulting in a lower weight reading. When just a few grams can mean several hundreds of dollars, having an accurate scale is critical. Unless the Office of Weights and Measures tests and certifies the scale, there’s simply no way to tell. At that point, it’s simply a matter of trust.” 

The Better Business Bureau does a good job of tracking complaints. You can search by a web domain or business name, as many of these businesses appear under multiple names. 

“The best way to sell your gold is to find a licensed and regulated business, like a pawn shop, secondhand dealer or a jewelry store,” advised Diane Taylor. “Pawn shops are accountable for their business practices and are regulated on a federal, state, and local level. Pawnbrokers are experts in gemology and metallurgy, they can test your gold on the spot and conduct a safe face-to-face transaction. They are permanent members of their communities and want to have a positive ongoing relationship with customers.”

“Government officials are aware of the proliferation of illegal gold buying establishments”, says Sam Shocket, president of King’s Jewelry & Loan Co. in Los Angeles. He added, “Unfortunately, it seems they simply don’t have the resources or funding to increase oversight and enforcement.” 

With millions of dollars of potential profits at stake and recent record high prices for gold, Mr. Shockett believes California could generate a substantial amount of revenue from businesses obtaining the proper licensure to purchase precious metals as well as increased tax revenue, all actions that his brick and mortar business complies with. He also believes that enforcement of the law would help cut back on crime.

This year, the California Pawnbrokers Association Convention and Expo will be held at the Hotel Maya on October 28-30, 2011. The Hotel Maya is situated on the scenic Long Beach waterfront and features stunning views and world class accommodations.

The convention is held in a more intimate venue than the national or regional conventions. This provides a great opportunity to spend time with and get to know fellow pawnbrokers, vendors, and experts. Attendees discover ways to improve their businesses and learn more about the current events affecting the pawn industry in California.

Don’t miss the chance to speak with the board of directors, association advisors, and the public relations team.

To register for the 2011 California Pawnbrokers Association Convention and Expo, contact Kim Andosca via our Contact page.