The Commodity Futures Trading Commission (CFTC) and 30 state agencies have accused Lucas Asher and Simon Batashvili of using companies such as Metals.com and Barrick Capital Inc. to defraud people in the sale of gold and other precious metals.  The CFTC said the defendants contacted their victims through phone calls and social media, telling them that the government could seize their asets unless they converted them into precious metals.  The defendants, according to the CFTC sold gold and silver to their scam victims at markups of as much as 300%. Politically conservative and religious people were particularly targeted by the defendants, according to the CFTC.  According to Heath Tarbert, the chairman of hte CFTC, the defendants “swindled tens of millions from the victims, who were targeted for their politically conservative and Christian leanings.”

In times of political turmoil, such as we are experiencing at this time, gold becomes more attractive to investors.  Unfortunately, along with legitimate gold merchants, there are many scammers who often contact their victims by telephone or email as well as through radio, television and online advertisements.

TIPS

Before investing with anyone, you should investigate the person offering to sell you the investment with the Securities and Exchange Commission’s Central Registration Depository.  This will tell you if the broker is licensed and if there have been disciplinary procedures against him or her.  You can also check with your own state’s securities regulation office for similar information.  Many investment advisers will not be required to register with the SEC, but are required to register with your individual state’s securities regulators.   You can find your state’s agency by going to the website of the North American Securities Administrators Association. https://www.nasaa.org/investor-education/how-to-check-your-broker-or-investment-adviser/ Many investment advisers will not be required to register with the SEC, but are required to register with your individual state securities regulators.  You should also check with the Financial Industry Regulatory Authority (FINRA) for information about the particular  investment adviser. https://www.finra.org/investors/protect-your-money/ask-and-check

It is also important to remember that you should never  invest in something that you do not completely understand.  This was a mistake that many of Bernie Madoff’s victims made.You also may want to check out the SEC’s investor education website at www.investor.gov.  Scammers can be very convincing and it may sound like there is a great opportunity for someone to make some money, but you must be careful that the person making money is not the scam artist taking yours. Additionally, investing with someone merely because you trust them because you have heard them on the radio or television is dangerous.

Specifically for prospective gold purchasers, you should make sure that the dealer selling you gold is a reputable dealer which you can do by checking out the dealer with the American Numismatic Association at its website http://www.Money.org.  Also do not have the dealer store your gold for you.  Always take delivery of the gold yourself.  Finally, only do business with dealers that offer a buy-back guarantee within 72 hours.  As for gold sellers who contact you by phone and pressure you to buy, you should just hang up the phone.

For those of you receiving the Scam of the day through an email, I just want to remind you that if you want to see the ever increasing list of Coronavirus scams go to the first page of the http://www.scamicide.com website and click on the tab at the top of the page that indicates “Coronavirus Scams.”  Scamicide was recently cited by the New York Times as one of three top sources for information about Coronavirus related scams.

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