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September 21st, 2009

Read This Before Your Next Garage Sale

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Planning on having a garage sale anytime soon? If so, you need to listen up. The Federal government has expanded upon a rule that limits the sale of toys — new or used –  that contain any lead. What’s being referred to as the “Resale Round-Up” was originally part of the 2008 Consumer Product Safety Improvement Act and it only pertained to the sale of new toys. The rule’s expansion will levy steep fines of up to $15 million dollars for any company, retailer, or individual that sells these toys:

In order to comply, stores, flea markets, charities and individuals selling used goods — in person or online — are expected to consult the commission’s 24-page Handbook for Resale Stores and Product Resellers (pdf) and its Web site for a breakdown of what they can’t sell.

Violators caught selling anything on the enormous list face fines of up to $100,000 per infraction and up to $15 million for a related series of infractions.

While the Consumer Product Safety Commission’s (CPSC) spokesperson Scott Wolfson said the fines are only intended for big companies with serious violations, the rule does not separate large companies from individuals. If you place a price tag on a toy that contains lead (new or used), you could be fined:

But FOX News Legal Analyst Bob Massi says the law makes no distinction for families and small resellers.

“Most people having garage sales at this point don’t have much anyway, so to have a fine levied against them is tantamount to harassment,” Massi told FOXNews.com. “And if you or I asked 100 people about this, they would never even know the law exists.”

The $2.3 million fine charged to toy maker Mattel recently for a lead-paint violation equaled out to roughly one dollar per toy, according to FoxNews.com. A $1,000 fine placed a family could be far more devastating. If nothing else, that’s why an odd but important development like this is important for consumers to be aware of.

After all is said and done, the audience that could be hardest hit, or at the least most inconvenienced, by this new mandate is charities:

The Resale Round-up has led some resale stores and charities to stop accepting children’s goods altogether, something President and CEO of Goodwill Industries Jim Gibbons said has some clients concerned.

“I saw on blogs, consumers saying, ‘Don’t take away my ability to shop at Goodwill for children’s clothing – this is how I clothe my kids and get them to school,’” Gibbons told FOXNews.com.

The problem, he said, is every not-for-profit and ‘mom and pop thrift shop’ has different capabilities and resources and a broad-brush approach may leave them unable to provide services.

Is the government overstepping its bounds here by this “broad-brush approach,” or is it a strict, but necessary mandate to protect children from lead-based products?

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About the HSH Blog

HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni

Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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