You asked: Questions surround party fad

Published 10:28 am Saturday, October 22, 2011

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You asked: Are gold-buying parties legal?

FRANKLIN—The popularity of gold-buying parties, often used as charitable fundraisers, has increased nationwide and in Western Tidewater, but the concept is new enough that questions about the legality of such parties are still being answered.

Third-party gold buyers go to private residences or other locations where invited guests bring gold jewelry and get cash for it. The host of the party gets a cut of the profits.

Billy Smith, owner of Smith Jewelers in Franklin, said he has to jump through many legal hoops to buy gold from a customer. He believes the party vendors should do the same.

“Whenever I buy from someone, I have to take their driver’s license and have them sign an affidavit that says it’s theirs,” Smith said.

He then has to wait 10 days and fax a record of his purchases to the Police Department to make sure the items aren’t stolen.

Smith said he is also required by law to buy a legal for-trade scale to weigh the items he buys.

He said the party vendors aren’t required to do any of that.

“I don’t have any problem with competition as long as they are playing on the same legal playing field,” Smith said. “They have to be illegal. There’s no way they can’t be.”

The SoCo YaYa’s Franklin-Southampton Relay for Life Team hosted a gold party Wednesday at the county office center in Courtland. Team member Cindy Cotton said The Gold Refinery, a gold-buying company out of Michigan, handled the event and the Relay team got a 15 percent commission.

Cotton said she had been to similar parties in the past where identification was required and this one was no different.

Contacted by The Tidewater News, a Gold Refinery representative declined comment.

Southampton County Commissioner of the Revenue Amy Carr said the issue is new.

“The only thing they would possibly need is a business license,” Carr said.

Caroline Gibson, deputy director of communications for Virginia Attorney General Ken Cuccinelli, said precious-metal dealers operating in the state generally need a permit issued by the top law enforcement agency in a locality, according to Virginia law.

Sgt. Wanda Covington, a spokeswoman for the Southampton County Sheriff’s Office, said she is unaware of any requests for precious-metals permits recently.