SAN FRANCISCO -- One of California's largest metal recyclers will pay $4.1 million to settle a civil suit brought against it by prosecutors in Contra Costa and San Francisco counties, authorities said Friday.

Sims Group US Corp., also known as Sims Metal Management and Sims Metal, will pay $4.1 million in civil penalties and costs and will be bound by a permanent injunction requiring the company to strictly follow guidelines and laws meant to prevent the reselling of stolen metals.

The settlement was announced by Contra Costa District Attorney Mark A. Peterson and San Francisco District Attorney George Gascon. Both said the lawsuit stemmed from the Sims' failure to obey the state's anti-metal theft laws.

According to the complaint, Sims owns and operates eight metal recycling facilities in Northern California.

"California is facing an epidemic of metal theft," Peterson said in a statement, adding that the cost of the crime "cannot be calculated and that recycling companies "must be required to act responsibly."

Peterson said the cost of the thefts have led to laws in California that require companies to take steps to ensure that the metal they recycle isn't stolen; that the sellers of certain scrap metal are identified through photos and fingerprints; and that the purchase of metal, in some cases, passes a three-day evaluation period.


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An investigation by undercover officers in San Francisco and Contra Costa County revealed that Sims employees violated laws in all three of those areas, Peterson said. The violations also occurred over several years, he added.

Gascon said law enforcement remains committed to fighting recycling theft by companies and that his office will "utilize all tools necessary to attack the marketplace of stolen metal."

Peterson and Gascon agreed that the injunction requires Sims to agree to the procedures established and that they expect the company to be a model for California metal recyclers in the future.

Officials at Sims, however, said they did not agree with the size of the financial settlement, but that in an effort to move past the case, agreed to pay the $4.1 million. They added that they believe their program aimed at discouraging metal thieves is, in fact, strong than ever.

"In no way does today's resolution mean that any actions by the company resulted in harm to the public or its customers," the company said in a press release. "Nor did the Company admit to any liability in this case. ... The Company continues to work cooperatively with local governments and with all other stakeholders involved with the purchase of scrap metal."

Contact Rick Hurd at rhurd@bayareanewsgroup.com and follow him at Twitter.com/3rdERH. Contact Katie Nelson at knelson@bayareanewsgroup.com and follow her at Twitter.com/katienelson210.