Catalytic Converter Crime Ring Scored $500 Million in Just 3 Years: Report
From school buses, to cop cars to even the hallowed Wienermobile, it seems like catalytic converter thieves hold no vehicle sacred. BuzzFeed News has an incredible deep dive into how what was once a petty, occasional crime turned into a nationwide crime syndicate capable of pulling in half a billion dollars in just three years.
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The problem of cat converter thefts has exploded in the U.S. since the start of the COVID-19 pandemic, along with the prices of the precious metals contained within the car part. Thieves can slide under a car and use a sawzall to remove a cat in less than a minute. It’s a risky maneuver, as suspected thieves have been crushed by cars on shaky jack stands or shot by irate vehicle owners but the skyrocketing cost of palladium and platinum makes it extremely worthwhile:
Prosecutors brought charges against 21 defendants across five states in what has emerged as the first major federal criminal case seeking to expose the vast scope of the catalytic converter black market and its role in a global supply chain that stretched from California to New Jersey and Japan.
The demand for catalytic converters traces to one of their essential components: palladium, a rare metal that has become one of the most valuable minerals in the world. From early 2016 to early 2019, the per-ounce price of palladium tripled from around $500 to $1,500, exceeding the value of gold for the first time in nearly two decades. Over the next three years, the number of catalytic converter thefts soared in the US: State Farm reported that its insurance claims for that crime rose by 400% from 2019 to 2022; the National Insurance Crime Bureau announced that its data showed a 1,215% increase; law enforcement agencies in San Francisco, Tulsa, and New York City have announced sharp surges, as have police departments in Chiba, in western Japan, and London. A single catalytic converter can contain up to 7 grams of palladium, as well as 7 grams of platinum, whose value has stood for years at around $1,000 per ounce, and 2 grams of rhodium, whose per-ounce price leaped from around $650 in 2016 to $2,500 in 2019.
The palladium boom triggered a catalytic converter rush that car owners, local legislators, and law enforcement agencies are struggling to contain, as rising living costs and stagnant wages continue to drive people into desperate circumstances without clear paths to upward mobility. Hundreds of pages of court documents reviewed by BuzzFeed News reveal that stolen catalytic converters are not simply the beginning of an underground supply chain but a link in a self-sustaining cycle: the palladium inside gets extracted and ultimately sold back to car manufacturers who need it to make more catalytic converters, which are in ever-rising demand because of these thefts.
The ouroboros nature of these thefts is what gets me—catalytic converters are full of precious metals, leading to their theft, which goes to companies who usually use those metals to make more catalytic converters. Catalytic converter theft is now widespread across the country, but owners of older model Prius vehicles are hit particularly hard as those vehicles contain more of the precious metals in their cats than most vehicles. In Los Angeles, the backlog for Prius owners looking to get replacements is up to 9 months, the LA Times reports.
For the complete (and I mean complete) report, check out BuzzFeed News’ story here.
