Gold broker told to improve its offer
GOLD broker CashMyGold has agreed to change its business practices after being served with an enforcement notice by the Office of Fair Trading.
The Crewe-based business was one of five companies served with a notice by the OFT following an investigation into practices in the sector, which began last January following a number of reports in the consumer press.
The regulator said that it was concerned with the business practice of sending customers a payment for their gold which, if not rejected and returned within a set period, was taken as consent for a deal and led to customers’ gold being melted down.
CashMyGold, whose registered business name is Bullion Buying Ltd, has since agreed to a number of changes to its business practices.
It will now have to provide people with the option of receiving either quotes for their gold or a simple payment, with warnings about the risks attached to each displayed prominently.
It also needs to provide information on the prices offered for gold, including the weight and carat of the items being assessed. It also needs to spell out the top prices paid for gold, and that the prices being offered to consumers are based on either the scrap or smelted value
Heather Clayton, senior director of the OFT’s Consumer Group, said: “These days we see more and more new business models which involve consumers distance selling goods to firms. These options are good for consumers, providing business practices are fair.
“Where we see problems, however, we are keen to intervene early so that these markets develop with an appropriate level of consumer protection.
“Any companies operating similar business models must make sure they treat consumers properly and provide clear information on how the service operates so that people make informed decisions about whether they wish to part with their possessions.”
