Are you selling scrap illegally without knowing it?

Published:  28 August, 2018

HVP Editor Joe Dart spoke to the British Metals Recycling Association about its campaign to inform tradespeople about metal recycling laws.

A by-product of working in the trade means that you are often left with waste material on completion of a job. Although some of it may need to be disposed of at a tip, scrap metal is a resource which can usually be safely recycled. Better still, many scrapyards are willing to offer you payment for your metal, meaning that you can profit while doing something environmentally conscious.

But are you aware that it’s illegal to sell your scrap for cash? The current law, introduced through the Scrap Metal Dealers Act (SMDA) in 2013, has been a source of confusion for years, according to Robert Fell, Chief Executive of the British Metals Recycling Association (BMRA).

He explained: “Unfortunately, the SMDA is badly worded, which has led to significant misunderstanding of the actual implications of the act by many sellers of scrap.

“The act is actually worded ‘it is illegal to pay cash for scrap’, but it doesn’t actually say in the wording of the act that it is illegal to receive cash for scrap. Therefore, there has been great misunderstanding that it’s only the other guy breaking the law, and that is absolutely far from the truth.”

The act was introduced to help combat a spate of metal thefts, which began in response to a spike in the price of metal. At the heart of the SMDA was the aim to inject traceability into the metal buying and selling process.

Under the act, the purchaser (usually a scrapyard) has to undertake full ‘know your customer’ (known as KYC) checks, which includes requiring the seller to present a valid photo ID, with proof of address. Additionally, the purchaser would have to pay the seller via a fully traceable transaction, such as a bank transfer.

Robert continued: “The act also requires scrap metal dealers to hold onto those records for the three years. So, the whole idea is to make sure that even if, 18 months down the road, it turns out there was stolen metal in a pile of material, you can trace it back and find out who you got that from.”

Cash is notoriously difficult to trace, which is why these transactions were made illegal under the act. If you fall foul of the law, you could be prosecuted and subject to an unlimited fine.

The BMRA is now taking steps to reach out to heating and plumbing professionals to both inform and remind them what the law is, especially as metal prices are starting to spike again.

Part of this included exhibiting at PHEX+ at Alexandra Palace in London in June, where the association also presented a seminar on the subject.

“The aim was to give a helpful warning to say that, if you’re in a yard that’s under surveillance for cash paying, then you will get prosecuted. If you come out the yard having received cash for your scrap, even if it’s only £50, you have broken the law. So, what we wanted to do was warn the community that there was this growing risk,” said Robert.

The BMRA’s presence at the show was also an opportunity to communicate to plumbing and heating professionals that they themselves were under threat from metal thieves. Thieves are targeting copper and lead in particular due to their high prices.

He said: “When we were speaking to a lot of the guys [at the show], they were having their garages broken into, their vans broken into, and a lot of copper in particular being stolen.”

At PHEX, Robert said that the BMRA found that “there were 20% [of visitors] who were genuinely shocked and didn’t know [the law]. You could tell by the expressions on their faces that they were shocked and, in some cases, horrified that they had inadvertently been breaking the law.”

But approximately 75% of the plumbers and heating engineers who visited the BMRA stand did know the law. Robert says this was a higher percentage than the BMRA was expecting, which was very pleasing.

Since then, the BMRA has continued to work to get the message out to our industry about the dangers of non-compliance.

Robert explained: “One of the things we’re looking at doing with the British Transport Police’s metal theft working group is a poster campaign that could go in trade outlets, so that anybody who is buying trade materials would be able to see what the law is, and it would be there at the counter to tell people what the law is, and inform them of the risks of not complying.”

Although the organisation is starting to make inroads, there is a lot more that could be done by government to clamp down on illegal metal trading.

Robert concluded: “In a perfect world, we would like the SMDA updated so that it is strengthened, the ambiguity is removed, and it’s much easier to enforce. We would absolutely want there to be money provided by the Home Office to fund the reinstatement of the Metal Theft Taskforce, such that not only was the act was strengthened, it was being also enforced, because that’s essential.”