The law already requires scrap metal dealers to check the identities of people offering metals for sale:
"(1)A scrap metal dealer must not receive scrap metal from a person without verifying the person’s full name and address.
(2)That verification must be by reference to documents, data or other information obtained from a reliable and independent source.
(3)The Secretary of State may prescribe in regulations—
(a)documents, data or other information which are sufficient for the purpose of subsection (2);
(b)documents, data or other information which are not sufficient for that purpose"
[Section 11, Scrap Metal Dealers Act 2013]
It also prohibits cash payments:
"A scrap metal dealer must not pay for scrap metal except—
(a)by a cheque which under section 81A of the Bills of Exchange Act 1882 is not transferable, or
(b)by an electronic transfer of funds (authorised by credit or debit card or otherwise"
[ibid, s.12]
That doesn't help much though if the dealer himself is as bent as a nine bob note!