When purchasing used goods, exercise prudence and caution

With the recent break-in and theft over at LensProToGo we thought it would be helpful to write a post regarding purchasing used photo and video gear, and how to best protect yourself from sticky legal situations. Buying stolen goods is bad, and unfortunately you could take some legal responsibility if you are caught with products that are registered in stolen goods databases. While this is not legal advisory by any means (speak with a lawyer), we offer this as prudent precaution for newcomers to the photography and videography fields. Or any industry, business or individual that purchases second-hand, used goods for that matter. There are a few simple steps you can do to protect yourself when buying used goods! Here are some recommendations;

Always get a Receipt of Sale from the Seller

Simply having a receipt goes a long way. Not only do you need a receipt to write-off business expenses with the IRS, but you can also be sure that the seller is reputable enough to stand behind their sourcing of the goods and materials. If you do end up with stolen goods, the most suspicious thing would be not having a receipt which could imply that you knew the goods were stolen, lost, or not validly obtained in a legal manner. A receipt, with the date and time of sale, the purchase amount as well as the buyer’s name, address and phone number will help protect you against thieves selling stolen goods on the second-hand market like Craigslist, eBay or elsewhere.

In many cases, when mid-sized or larger businesses professionally purchase the assets of other companies or individuals they attach a contract that states similar positions. The purchases wants to ensure that the goods are free and clear of any legal liability, so a “Used Goods Purchase Contract” might contain legalese that says the Seller certifies and warrants that the second-hand goods were [1] rightfully obtained, [2] are not stolen or lost to their knowledge, and [3] are free of any legal liability insofar as much as they are aware. Usually, for very large purchases like computer servers, larger assets, etc. the Seller will even provide the original receipt as proof that the goods are legitimate and eligible for resale. This is all very important in protecting you, the buyer, from purchasing stolen goods and becoming victim later on. Claiming ignorance might not save you, but a receipt and bill of sale, or a Purchasing Used Goods Contract can go a long way towards protecting and limiting your liability in the event that something does turn out to be an illegitimate good. Again, it’s best to discuss these things with a lawyer proper, but this is prudent advisory for any second-hand buyer.

You may still be responsible for Use Tax (Sales Tax)

Additionally, laws vary state to state, and even on the county and city levels on Sales Tax and the treatment of Use Taxes. You will want to check your local ordinances and laws here. Technically, you are responsible for paying “Use Taxes” whether or not the merchant (seller) collects them on your behalf or not. What are commonly known as “Sales Tax” is actually a “Use Tax” on goods or services within a jurisdiction. To make things more convenient for consumers, merchants commonly collect the Use Tax on behalf of the buyer, and this is where we get Sales Tax when buying goods. In other words, just because your seller fails to collect Sales Tax, doesn’t necessarily mean that you are free and clear from paying Use Taxes on the goods or services that you just recently purchased. Again, this is an area that varies so wildly from state to state, county to county and city to city, that you will want to either check and familiarize yourself with local laws, or most certainly consult with an expert on the matter in larger purchases. Again, exercising caution and prudence while buying is smart!

Purchasing Used Goods versus New Goods (is it even worth it?)

Sometimes yes. Sometimes no. That is at the discretion of each individual or entity. Generally at our company, we shy away from purchasing second-hand goods unless we know the seller personally or are 100% sure that the goods and free and clear of any legal liability. For the reasons mentioned above, shaving a small percentage off the purchase price sometimes doesn’t justify the peace of mind that buying new goods brings. When you buy new, direct from a reseller, retailer, or even the manufacturer — you can be certain that you are buying legal goods, and not even have to worry. In the case of used goods, there is always a looming uncertainty hanging over your head, unless you have a clear Bill of Sale and a Contract with the seller warranting the goods are legitimate.

Regarding buying Used Lenses, Photography or Video Equipment

By no means are we promoting or condoning theft, but when assessing the recent break-in and theft at LensProToGo, you have to wonder how much their serial numbers are actually going to help them in catching the thieves and returning the goods. Most likely, their business insurance will step in and help them recover much of their losses, that is after all why insurance for businesses exists.

However, when we realistically examine the likelihood of catching the thieves, it doesn’t seem very likely, even given the serial tracking databases that exist for camera equipment. In plain English, just tracking serial numbers isn’t really enough. All a thief has to do is [1] jump jurisdictions, [2] pawn it off for re-sell to dumber criminals, and maybe even [3] replace, remove or modify the serial numbers on the equipment. They could even [4] resell the equipment directly to amateurs and novices who do not care to check stolen goods databases, who will then go on to shoot weddings and corporate events or projects on shoe string budgets using stolen equipment. Serial numbers actually do very little except to catch the lowest hanging fruit of criminals. And only on occasion, if lucky.

More likely, it’ll affect the victims of whomever purchases the stolen goods, not even realizing they are stolen. And that’s the primary reason for this post. Every second-hand buyer should get a Bill of Sale with the buyer’s name, address and phone number, or even the original purchase receipt just to be sure that the Used Goods are free and clear. Unfortunately, many amateurs, even professionals, will fail to check serial numbers when buying second hand goods, or even know about this event or the many other events where highly valued equipment is lost, stolen and then traded underground.

This is precisely why we refuse to buy ANY used photo or video gear, because you really don’t know the history, or status of that equipment; i.e., it always remains questionable! Even if it clears databases as they currently stand, it may just be a delay in information processing. Always get a receipt when buying used goods, so you can pass along the legal repercussions if the gear does end up being added to a stolen items database later on. Going beyond that, put together a simple Bill of Sale contract that states the seller is warranting and also representing that the goods are legally theirs or rightfully theirs to sell. This way, when purchasing used goods, you will have some legal protection to argue and protect yourself. Again, this is not legal advice, but simple prudence and cautionary warnings to seek legal advice for the reasons listed.

In summary, if you choose to purchase used goods, get a receipt and exercise due diligence!