Scrap dealers resist new rules to discourage thieves

Oct 16, 2011

The following article was published in the Miami Herald on October 16, 2011:

Scrap dealers resist new rules to discourage thieves

By Juna Ortega

The guys who bought the “recycled” metal didn’t mind that it was stolen, and even made an enticing offer to the sellers: Tell us where we can snatch home air-conditioners, and we’ll pay you more.

When Alvaro Alvores-Aquilar and Edwin Pereira-Cardona handed over $648 cash for 50 brass water meters, the net came down at JM Scrap Metals LLC. The sellers were undercover Fort Lauderdale police officers; the buyers are serving 18 months of probation for dealing in stolen property.

Since 2006, the Broward State Attorney’s Office has reviewed about a dozen such cases against metal buyers — all but two in the past 18 months, records show.

Because of public safety concerns about metal thievery from places like highway lights, elected officials are looking to tighten restrictions on scrap-metal yards. If they make buying stolen property riskier for dealers, the reasoning goes, they’ll cut off the demand side of the illicit business.

But in South Florida, dealers say targeting them would be a misguided, ineffective approach that would cripple law-abiding businesses.

“It’s definitely going to put people out of business, having to comply with all that kind of regulation,” said Alan Covitz, 54, of Weston, who opened Powerline Scrap Metal in Pompano Beach 10 years ago. “They’re putting all the burden on us. How much more can we do without having our industry grind to a halt?”

The number of registered scrap-yard dealers in Broward and Palm Beach counties has spiked 62 percent in three years, from 370 to the current 601, according to the Florida Department of Revenue.

The surge in dealers coincides with the rise in the value of metals and the number of thieves trying to cash in. Broadening their investigations, authorities are jailing unlicensed scrap-yard dealers, or ones who turn a blind eye to the illegal sources of items offered for sale.

“In order to fix a problem, you need to address the root of it: Scrap yards that are purchasing metal from these thieves,” said Fort Lauderdale police Detective Travis Mandell. “When we conduct undercover operations, we’re able to infiltrate these illegal scrap-metal rings.”

State Sen. Chris Smith, D-Fort Lauderdale, also blames certain metal recyclers for today’s metal-theft “epidemic.”

He is co-sponsoring a bill that he plans to file in January that would increase criminal penalties against thieves and corrupt recyclers. The legislation would make it harder for all recyclers to buy 17 metal items often targeted for theft — things like backflow valves, air-conditioner coils and utility wires and fixtures. Sellers of the 17 items would be required to prove ownership or show they are authorized to sell them.

Sean Harrigan, 36, operations manager at Capital Scrap Metal in Deerfield Beach, said recyclers who conspire with thieves give his industry a bad name.

“We’re being painted with a broad stroke of helping these people,” Harrigan said. “That’s not what it is. We do what we can to prevent it.”

Harrigan said it would be unrealistic to expect him to verify ownership of so many metal items when his company serves 300 to 400 customers a day. A better way of fighting metal theft, he said, would be for recyclers, authorities and government officials to talk to each other.

“There needs to be more communication and less talking heads who don’t have a clue,” Harrigan said of elected officials. “We’re trying to help them. We’re on the front lines.”

Covitz, the Powerline Scrap Metal owner, said recyclers cannot always tell what is stolen. He said he rebuffs people hawking suspicious things, such as statues and cemetery vases. Whenever he’s sure something is stolen, he phones 911 and stalls the thieves until Broward sheriff’s deputies arrive.

“Scrap wire is scrap wire,” Covitz said. “If you pull it out of the ground, it looks like any other scrap wire. I don’t know how you can prove it’s yours.”

On a recent day, as a steady stream of sellers drove pickup trucks into the yard at Pompano Scrap Metal, Covitz and his employees moved fast: Photographing customers and their goods, recording thumbprints and car-tag numbers, and typing seller information into a database.

“You see what’s going on here?” Covitz asked. “If I had to sit here and try to figure out who owns what, it would slow business to a crawl.”

All the activity is required under current state law, in case police detectives need the records for theft investigations.

In Tallahassee, Smith argued the bill would minimize the likelihood of criminals selling to scrap yards. If metal sales were to hinge on proof of ownership, it would not be worth the effort of stealing the goods, he said.

“Word needs to get out: ‘Even if I steal this, I can’t sell it,’ ” Smith said. “That’s the mentality that we want to get out to the public.”

Not all scrap-yard dealers oppose Smith’s bill.

He is consulting with the industry coalition Floridians for Copper and Metal Theft Crime Prevention. One proponent is Trademark Metals Recycling, billed as Florida’s largest recycler, with 21 locations.

Given that recyclers already must record plenty of customer information, they should be able to adjust to a higher level of government oversight, said Dale Shaw, a Trademark Metals Recycling vice president.

“We don’t see a problem with how the bill is written,” Shaw said. “The biggest deal for us is, we want to be part of the solution.”

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