The Prince George's County Council cracked down on the mushrooming business in gold and silver buying last week, passing a bill aimed at regulating dealers who operate in stores, motels and roadside vans throughout the county.
It was the first thrust of a two-pronged attack on dealers in precious metals, who police say may be indirectly responsible for a 70 percent increase in the theft of gold and silver items in burglaries throughout the county.
A second bill, to require licensing of the traders and their places of business, is being drafted by the council staff.
Under the legislation passed last week, the gold and silver buyers must file weekly reports with the police department, describing in detail the items they buy, and identifying the sellers. The law covers property such as stereo components, office equipment, watches, cameras, television sets and musical instruments as well as gold and silver items, jewelry and gems. Transactions with youths under 18 are prohibited without permission from parents.
A key provision of the law is a five-day holding period for all merchandise before it can be resold. Police consider this necessary to allow burglary victims time to identify and recover stolen property, since gold and silver items often are resold to refiners to be melted down.
Gold and silver buyers such as L.H. Catlett of the Hyattsville-based Precious Metals Specialists Inc. opposed the waiting period. They testified before the council that it would violate their "right of property," and vowed to file suit if County Executive Lawrence J. Hogan signs the bill into law.
"We feel there is a restraint of trade here," said Catlett. "It weighs a bit heavy in favor of the police. It doesn't give us our right to work in a free economy without restriction."
On Oct. 29, Alexandria became the first suburban jurisdiction to pass a law regulating the gold and silver buyers. Catlett, who said his firm has expanded from 14 to 30 metropolitan area locations within the last two months, said his lawyers already are challenging the constitutionality of that ordinance. Montgomery County recently introduced legislation to require a 15-day holding period on purchased goods, and reporting procedures similar to those set by the Prince George's bill.
Jim Herl, an aide to Frank Casula, sponsor of the Prince George's legislation, disputed the dealers' arguments. He said not all dealers were actively fighting regulation, and that all had been given a chance to participate in the bill's development. For example, he said, the holding period was moderated from 15 to 5 days after consultation with the dealers.
The law, which sets a $1,000 fine, six months' imprisonment or both for violations, will expire one year after enactment, to give the council a chance to review the results.
"Some members of the business community felt it was too much regulation in their industry," said Herl, in explaining the "sunset" provision.
Hogan is expected to sign the bill, and it will become effective immediately thereafter. Within two weeks, police will distribute the weekly report forms to all dealers in the county, according to Herl.