Over the past two years gold prices have soared, and in the past week the value of a troy ounce (31 grams) on the U.S. market has jumped to more than $1,200. The price has more than doubled since 2007, and some area residents have responded by selling their gold in order to help make ends meet in a struggling economy.

As more people become involved in the gold trade, local police and state officials have been working together to strengthen laws and eliminate loopholes, said Douglas Dortenzio, president of the Connecticut Police Chiefs Association.

The association and Glastonbury Police Chief Thomas J. Sweeney "have been intimately involved in drafting legislation for the spring session" of the General Assembly, Dortenzio said. "Last year we had formed a partnership with the attorney general and chief state's attorney's office with the goal of closing loopholes to protect both consumers and the state's economy."

State law requires that gold buyers or sellers be licensed through either a municipality's police chief or first selectman. The law, which also applies to jewelry or precious-metals dealers, doesn't specify what control these authorities have to set restrictions on licenses, and it has allowed criminal activity to go relatively unnoticed.

When state officials began reviewing the law recently, it was determined that police chiefs and first selectmen do have the right to enforce certain restrictions, limitations or regulations.

In Meriden, police have taken the opportunity to review their policies and are prepared to implement a stricter set of requirements to improve oversight, according to Police Chief Jeffry Cossette and Deputy Police Chief Timothy Topulos

Topulos said these regulations will include a requirement that any gold buyer record purchases, including who the items were purchased from, as well as details regarding the type of jewelry, including gem size and the total value of the purchase.

The city's policy of requiring any gold buyer to undergo a criminal background check before a license is issued will now be strictly enforced, according to police. Topulos said gold buyers will also be required to hold onto purchases for a certain period before they can be melted down or resold, in order to prevent the destruction of stolen goods.

Similar policies are also being enforced in Southington and Wallingford.

Meanwhile, several state agencies are working together to develop legislation that would enhance what Sweeney called an older, vague state law.

"The law regarding precious metals does not provide any details and we have been in discussions to strengthen it through the state legislature," Sweeney said.

The scope of the effort extends well beyond precious metals, Sweeney said, including rewriting pawn shop laws to further prevent the theft and sale of retail goods. If such problems are not addressed, Sweeney said, it could have adverse effects on both residents and the state's economy.

Earlier this year, Glastonbury police arrested a man they said had been making $13,000 a month by selling stolen goods, including tools and precious metals such as gold. Sweeney said these items were stolen from companies, which hurts those businesses and cuts into state sales tax revenue.

Furthermore, criminals are not reporting income generated from the stolen goods and the state is again losing money as a result of tax evasion associated with the sale of the stolen items.

"For some people, this type of criminal activity is a full-time job. When you consider the amount of money involved in this one arrest and look across the state, millions of dollars are involved in this illegal industry," Sweeney said.

The state Department of Consumer Protection has been working on a public campaign to address potential problems associated with gold parties, a fast growing business venture.

Gold parties are home parties in which a host invites people to consider weighing and selling their scrap gold or other precious metals.

Consumer Protection Commissioner Jerry Farrell Jr. said partygoers need to take precautions.

"It's nice to gather in someone's home, have food and drink and socialize, but if that party also involves potentially selling your gold, consumers need to take the time to get important information in advance," Farrell said.

The DCP suggests residents take their jewelry and precious metals to a reputable dealer to have the items appraised before selling.

Police also remind residents to make sure the gold party is registered with the police department and that the buyer helping host the party is locally licensed.

Sweeney and Topulos said that gold parties are legal but a permit must be obtained for every party. The gold buyer involved in the party is also responsible for accurately recording every item purchased, and information regarding the seller.

No matter where the gold is bought, police caution that the seller must be paid by check or money order. Under state law, cash cannot be used to pay for precious metals.

"It's an issue that exists at the local, state and federal level," Sweeney said. "The only way to deal with the issue is for everyone to come together and address the problem, both within the state and across state lines."

jvallee@record-journal.com

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