New WA law aims to erase black market for stolen catalytic converters

When the price of precious metals began tumbling late last summer, so too did demand for stolen catalytic converters, the exhaust-cleaning components that can be cut from a vehicle’s undercarriage in seconds and sold on the black market.

But demand will inevitably go back up once the prices of rhodium, palladium and platinum – metals used in the manufacture of catalytic converters – rise again, law enforcement officials and lawmakers say.

To prevent a future surge in catalytic converter thefts, a new law is aimed at eliminating the black market of illicit buyers who created the opportunity for front-line thieves to make quick cash with a couple of cuts of a battery-operated saw.

“Our goal was, minimum impact on legitimate business people, maximum impact on illegal, black market, Wild West purchasers,” said Gary Ernsdorff, a King County senior deputy prosecutor and member of a state work group tasked last year with finding ways to address the meteoric spike in catalytic converter thefts.

There isn’t any clear data on just how many catalytic converters have been stolen in Washington since 2020, the start of a pandemic-era trend that surged in 2021 and 2022, according to a Washington State University report commissioned by the state Legislature and published in early 2023. At that time, apparent supply-chain issues drove the price of rhodium, in particular, to a peak of nearly $29,000 per ounce.

Rhodium is currently priced at $4,350 per ounce, according to prices listed on KITCO.com, a leading online retailer of precious metals.

The data is limited by the fact that reporting from police agencies is inconsistent. Many agencies don’t track catalytic converter thefts specifically, and other agencies vary in how they track them. In addition, victims don’t always report thefts to police.

The National Insurance Crime Bureau reported in May that insurance claims for catalytic converter thefts across the country increased from 16,660 claims in 2020 to 64,701 in 2022.

While insurance claims for stolen catalytic converters rose dramatically in 2020, the numbers don’t capture the full extent of the surge in thefts. Only drivers with comprehensive insurance can file such claims, and many victims likely chose to pay out of pocket if their deductible was similar to the cost of repairing the damage, according to the report.

Even at the height of demand, thieves were selling the catalytic converters for a fraction of what it cost drivers to replace them.

“Often metal recyclers pay between $50 to $250 for a catalytic converter and up to $800 for one removed from a hybrid vehicle,” says a NICB news release. “It can cost between $1,000 and $3,500 or more to replace a catalytic converter that is stolen, depending on the type of vehicle.”

Rep. Cindy Ryu, D-Shoreline, first became aware of the scourge of catalytic converter thefts when four vans used to drive older congregants to her former church in Edmonds were hit in 2020. Soon after, she was attending a national conference of state legislators and decided to tag along on a junkyard tour.

“I see these catalytic converters that were detached and so I asked a whole bunch of questions,” she said. “I told the chair, Roger Goodman, I want to introduce a bill and he said, ‘Oh good.’

“That’s where it started. Who knew I’d still be working on it?”

Ryu first sponsored House Bill 1815, which was passed in 2022 and introduced on scrap-metal recyclers and vehicle wreckers specific record-keeping duties, restrictions on transactions, and obligations to cooperate with police to assist in preserving evidence of stolen property. The legislation also led to the creation of the work group that did a deep dive into the problem of catalytic converter thefts last year.

Its work led to House Bill 2153, which makes trafficking catalytic converters a Class C felony and requires new licenses and increased record-keeping for scrap-metal dealers and vehicle wreckers. No one can sell a catalytic converter without a driver’s license or state-issued photo identification and payments must be made by check and sent to the seller’s address at least three days after the sale. Sellers are also required to sign legal declarations that to the best of their knowledge, they aren’t selling stolen property.

The new law also directs car dealers to provide customers with the option of marking their catalytic converters with partial vehicle identification numbers and gives police the power to immediately seize any unmarked catalytic converters they come across.

“This brings everybody who is going to touch a catalytic converter under one umbrella and working under the same regulatory scheme. This raised the floor,” Taylor Gardner, deputy policy director for the Washington Association of Sheriffs & Police Chiefs, said of the bill. “The concept is we’re going to drive down the opportunity for illicit sells and illicit buys by regulating in a uniform way.”

Gardner, also a member of the work group, said representatives from the metal industry supported the legislation because they “don’t want this kind of illicit market to exist either.”

The Pacific Northwest chapter of the Institute of Scrap Recycling Industries said in a statement that its members are pleased to work with law enforcement and other stakeholders to pass laws that directly impact catalytic converter thefts.

“Metal recycling facilities are well regulated in Washington in the purchase of all metals, not just detached (catalytic converters),” the statement says. “Our facilities have a longstanding history in the communities they serve and we see our industry as partners with law enforcement to reduce metals theft.”

Though Gov. Jay Inslee signed HB 2153 into law last week, it won’t go into effect until next spring in order to give the state Department of Licensing, Washington State Patrol and other agencies time to create the new licenses, develop procedures for business inspections and add new criminal offenses to state code, Ryu said.

Under the bill, the cost of a new license must include $500 that will go to the State Patrol to conduct periodic inspections of scrap metal businesses.

Ernsdorff, the senior deputy prosecutor and member of the work group, noted that 100,000 vehicles are decommissioned in Washington each year, which means there’s already a large number of catalytic converters that get recycled by legitimate businesses. That means unregulated players – including those who advertise on Facebook Marketplace, Craigslist and other sites – are the people buying up the stolen ones.

“I think the biggest part of this bill is making it a law that in order to buy (catalytic converters), you have to have a license. It’s a very simple requirement,” he said. “By requiring licenses, requiring inspections, requiring record-keeping, by delaying payment … that is going to have a really significant impact if not totally eliminate the illegal black market for these.”