Metal Theft Is Troubling New Criminal Pursuit

Congress plans to shut off the market for stolen copper and other expensive metals.

By Richard Sammon, Senior Associate Editor, The Kiplinger Letter

September 2, 2009

Look for Congress to crack down on a new crime wave: the theft of valuable scrap metal. Lawmakers aim to prevent theft by making it harder for crooks to sell what they steal. That means more regulation and recordkeeping requirements for the $71-billion-a-year scrap recycling industry. Firms that ignore the rules would face big fines.

The rise in theft is driven by the spikes in prices of metal commodities, especially for copper, which has nearly quadrupled since 2000. Copper went up from about 80¢ per pound to $4 a pound last year, and is about $2.60 a pound today. That’s still high enough to spur theft for quick cash. Silver and other nonferrous metals also bring good prices.

Businesses, homeowners and local governments are all potential targets. Irrigation equipment has been stolen from farms. Electric power lines have been stripped for copper wire. Telecommunications equipment and electric utility transformers have been lifted. Vacant homes have been vandalized, and even railroad signaling wire, golf course sprinkler systems and manhole covers have disappeared, in some cases creating public safety issues.

Estimates of the cost of metal theft nationally are unreliable because much of the theft goes unnoticed or unreported. But copper theft has caused power outages and phone line disruptions. AT&T estimates theft incidences of the copper it uses has increased 150% since 2007.

Legislation in Congress will require recyclers to keep sales transaction records and will prohibit cash only sales worth more than $100. Civil penalties for violations by recyclers could be as high as $10,000 per incident. The Federal Trade Commission and state attorneys general will combine efforts on oversight and prosecution.

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