Gold scams and other fraud are on the rise as criminals take advantage of gold’s high value and demand.. In recent years, authorities have seen a surge in gold-related scams costing victims hundreds of millions of dollars.1 Below we explore common types of gold scams, real case examples, the tactics scammers use, efforts by law enforcement to crack down on these schemes, and practical tips to protect yourself.
Common Types of Gold-Related Scams
Investment Schemes and Ponzi Scams:
Fraudsters pitch gold as a “can’t-lose” investment, often promising high or guaranteed returns. In reality, they may run Ponzi schemes or fake “gold-backed” investments. For example, a scam called OSGold posed as an online bank backed by gold but was actually a Ponzi scheme – it promised 30-45% returns and “guaranteed” principal, yet no gold existed and investors’ money was stolen.2 Red flag: Claims of low risk or “fully guaranteed” returns from gold investments are a big warning sign. All legitimate investments carry risk, and gold prices can fluctuate.
Fake or Non-Delivered Bullion Sales:
Some scammers offer gold bullion or coins for sale (often at “too good to be true” prices or with no fees) but never deliver the goods once paid. In one Federal Trade Commission (FTC) case, a business called Discount Gold Brokers ran national ads touting gold at 0% above dealer cost, lured customers (many using retirement savings) to send money upfront, and then failed to deliver the gold as promised.3 Hundreds of buyers never received their orders and lost their money. Similarly, a well-known dealer, The Tulving Company, took $15 million from over 380 customers for coins it could not fulfill, using new customer payments to pay off old orders until it collapsed – a classic bait-and-switch fraud that landed its owner in prison.4 Red flag: Be wary if a dealer demands full payment upfront and repeatedly delays delivery or if they are a new/unfamiliar vendor with unbelievable prices.
Counterfeit Gold Bars and Coins:
Not all gold scams involve missing shipments – some involve fake gold. Scammers may sell counterfeit gold bars or coins that look real. In late 2023, police in Alabama arrested a man who sold multiple fake one-ounce gold bars on Facebook Marketplace, duping buyers by making the bars pass basic authenticity tests.5 The suspect had numerous counterfeit bars in his possession, indicating multiple victims. Likewise, industry watchdogs have warned of hundreds of fraudulent websites selling counterfeit gold and silver coins online to unsuspecting buyers.6 Red flag: If buying gold secondhand or online from unknown sources, there’s a risk of counterfeits. Gold-plated base metals can be crafted to fool magnet tests or visual inspection. Always verify bullion through reliable assays or purchase from established dealers.
“Courier” Scams and Impersonation Fraud:
A disturbing new scam involves criminals impersonating officials (from tech support, banks, even federal agencies) and convincing victims that their money is in danger. They instruct victims to liquidate their savings into cash or gold, then send a “courier” to pick it up for “safekeeping”.7 The FBI reports an uptick in these schemes in 2023, with over $55 million lost from May to December 2023 alone.8 Often called the “phantom hacker” or government impersonation scam, it unfolds in steps: Scammers trigger a fake security alert (like a computer pop-up claiming you’ve been hacked), then pose on the phone as tech support and even as FBI or Treasury agents. They claim your bank account is compromised or your identity is tied to crime, creating fear. The solution they offer is drastic – withdraw your funds and buy gold (or take out gold from your safe deposit) to protect it, then hand it to a courier with a secret passcode for verification. Once the scammers get the gold, they disappear. Red flag: No legitimate government agency or bank will ever tell you to buy gold or hand over assets for “protection”. Any such request, especially if preceded by unsolicited calls or emails about hacks or investigations, is fraudulent.
Phishing and Online Fraud Targeting Gold Investors:
Scammers also use phishing emails, fake websites, and social media to prey on people interested in gold. This can take many forms. In one trend known as “pig butchering”, scammers strike up a friendship or romance online and then lure the victim into investing through a fake platform – sometimes encouraging commodities like gold contracts or “gold-linked” crypto as the investment bait.9 The victim sees fake profits on a phony website and invests more, until the scammers disappear with all the funds. Other phishing scams involve emails or ads that imitate reputable gold dealers or mints, directing victims to enter personal info or make payments on lookalike sites. Red flag: Unsolicited investment “opportunities” via email, text, or social media – especially from strangers – are almost always scams. Never click suspicious links or download files from unknown sources related to gold investing.10 Legitimate dealers won’t randomly email you out of the blue with secret deals.
Overpriced Coin and IRA Scams:
Not all gold scams are outright theft; some are high-pressure sales of gold at grossly inflated prices. Often targeting retirees or those with self-directed IRAs, unscrupulous telemarketers or “investment advisors” push people to convert retirement savings into gold coins or precious metals. The pitch misrepresents gold as a 100% safe asset or claims certain rare coins will skyrocket in value. In reality, the coins are sold with exorbitant fees or markups, making it nearly impossible for the investor to ever recoup a profit.11 A prominent example is Safeguard Metals, a California dealer that from 2017–2021 deceived about 450 seniors into a $68 million scheme: They falsely touted precious metals as low-risk IRA investments and sold silver and gold coins at average markups of 51–71%, far above what they disclosed to customers. Victims who thought they were buying “safe” assets immediately lost a large share of their investment due to the inflated prices. Red flag: Be cautious if someone pressures you to move your IRA or 401(k) into precious metals, especially if they claim it’s urgent to avoid a financial collapse. High commissions, storage fees, and huge spreads between buy and sell price are common in these scams.12 Always comparison-shop pricing for coins/bullion: if you’re being charged 30%, 50%, or higher above the market melt value, that is likely a rip-off.
Recent High-Profile Gold Scam Cases
Real-world cases highlight how devastating gold-related fraud can be and show the range of schemes:
Safeguard Metals (2023) – $68 Million Elder Fraud:
Safeguard Metals LLC and its owner were found liable for running a nationwide fraud targeting elderly investors. Over four years, they solicited retirees to buy precious metals (mainly silver and gold coins) for self-directed IRAs, misleading victims about the safety and value of these investments and charging huge undisclosed markups (averaging 71% on coins). About 450 people lost their retirement savings in this scheme. In October 2023, the Commodity Futures Trading Commission (CFTC) and 30 state regulators obtained a court order against the firm, with the SEC pursuing a parallel action for securities fraud. This case underscores how fraudsters prey on economic fears (like stock market volatility) to sell overpriced gold as a “safe haven.”
Metals.com / Barrick Capital (2020) – $185 Million Bullion Scam:
In September 2020, the CFTC and state authorities shut down a pair of precious metals dealers (operating as Metals.com and related names) who executed an enormous fraud targeting seniors nationwide. Over 1,600 investors were allegedly tricked into purchasing overpriced gold and silver bullion, in a scheme that brought in more than $185 million. The companies used false claims and scare tactics to convince victims to liquidate securities and buy precious metals, then pocketed huge profits through inflated prices. This is one of the largest precious metals fraud cases on record, showing the scale such operations can reach.
The Tulving Company (2013-2014) – Non-Delivery Fraud, $15+ Million:
Tulving was a respected coin and bullion dealer that abruptly turned fraudulent. The owner, Hannes Tulving Jr., took orders and payments from customers for gold coins he could not fulfill, effectively robbing Peter to pay Paul. In a span of about 6 months, Tulving’s firm defrauded over 380 customers of more than $15 million – accepting their money and either shipping nothing or only a portion of what was ordered. He used new customer funds to pay off earlier customers or cover debts. The scheme collapsed in 2014 and Tulving ultimately pleaded guilty to wire fraud. In 2016, a federal judge sentenced him to 30 months in prison and ordered a $10 million fine against the company. This case is a cautionary tale: even a previously reputable dealer can fail to deliver and cause huge losses if they fall into financial trouble or deceit.
FTC v. Discount Gold Brokers (2016) – Bogus Gold Sales:
The FTC charged this California-based operation for taking millions from consumers for gold and silver orders and never delivering product. They ran TV and radio ads offering gold at “0% commissions” and “discounted” rates, inducing people to send large payments (sometimes $50K or $100K from retirement funds). After payment, customers were strung along with excuses for weeks or months, and hundreds never received the gold they paid for. Regulators noted this violated federal trade laws (including the Mail/Internet Order rule) and moved to shut down the scheme. It’s a stark example that slick advertising is no guarantee of legitimacy.
Government Impersonation “Gold Courier” Scam (2023-2024) – Individual Victims Losing Six Figures:
Law enforcement has highlighted numerous cases of the courier impersonation scam mentioned earlier. One high-profile victim was a 77-year-old retired professor in Seattle: scammers posing as FTC officials convinced her that her bank accounts were compromised by criminals. To protect her assets, they instructed her to withdraw $233,000 and buy gold bars, which a “courier” then picked up “for safekeeping”. Over several weeks, the woman ended up losing more than $400,000 (gold, cash, and even some bitcoin) before the ruse became clear. In another case, a widower from Indiana lost $80,000 in gold bars after a fake pop-up message on his computer led him into a months-long scam by criminals impersonating FBI agents. The FBI set up a sting to catch a perpetrator in that case – a Chicago-area man – but he fled the country. The FBI says that nationwide, victims have reported over $100 million in losses to such gold courier schemes as of early 2025. These cases show how even educated, careful people can be ensnared by elaborate social engineering scams that exploit fear of authority and sophisticated theatrics.
How Scammers Target Victims and Execute Gold Fraud
Fraudsters use a variety of social engineering and deceptive sales techniques to ensnare their victims. Understanding their methods can help you spot a scam before you get hooked.
High-Pressure Sales and Urgency
Whether it’s an unsolicited phone call pushing an “exclusive” gold investment or an email claiming a limited-time offer on bullion, scammers love to inject urgency. They might insist you “act now” or risk missing out on huge profits – or warn that delay could mean financial ruin. This pressure is deliberate: by creating panic or FOMO (fear of missing out), they hope you make rash decisions. Example: Many coin scam telemarketers use persuasion tactics like phantom riches (“gold is going to double in value soon, you’ll get rich”) or scarcity (“we only have a few coins left, this offer won’t repeat”). Reputable investment professionals do not bully customers into quick decisions. If someone refuses to let you think it over or consult third-party advice, that’s a major red flag.
Fear Appeals and Problem-Solution Setup
Scammers often frighten victims with a hypothetical problem only their scheme can solve. For example, gold IRA scammers prey on fear of economic collapse or stock market crashes – they paint a dire picture of hyperinflation or bank failures and position gold as the safe refuge (all while selling at inflated prices). Imposter scams (like the “courier” scheme) use personal fear – telling you that your identity is stolen or you’re implicated in a crime, to pressure you into drastic action. Once you’re rattled, the scammer presents buying gold now or handing over assets as the only way out. Always be suspicious of anyone who contacts you with bad news about your finances or security, then immediately offers a fix that involves moving your money. Legitimate institutions don’t operate that way.
Impersonating Legitimate Entities
A common tactic is to assume the identity of someone you trust – be it a government agency, a well-known gold dealer, or a financial institution. Scammers will spoof caller ID numbers, create look-alike email addresses, or forge documents to appear authentic. In tech-support-to-gold scams, criminals have posed as FBI, Treasury, or FTC officials on the phone. Others impersonate brokers or advisors, claiming to represent reputable firms. There have even been cases of scammers stealing the names and logos of real gold companies for fake websites or adverts. This is why verification is crucial – don’t trust a person is who they say just because they have some official-sounding information. Independently look up the official contact info of that agency or company and confirm if the outreach is real.
Affinity and Targeted Marketing
Many gold scams deliberately target specific groups. Fraudulent metals dealers often seek out older Americans and retirees, knowing they have nest eggs and may be more receptive to conservative investment pitches. Scammers also exploit affinity groups – for instance, some scam dealers advertise on talk radio or in church groups that align with certain political or religious audiences, using messaging that resonates with their worldview (like fear of government, or biblical references to gold). By infiltrating social media groups or forums, they gain trust before pitching the scam. Always remember, just because someone shares your background or beliefs does not automatically make them trustworthy with investments.
Use of Online Lures (Phishing, Pop-Ups, and Ads)
Modern scammers cast a wide net via the internet. Phishing emails may pretend to be from a bank or a gold retailer, asking you to “verify” an order or account – when you click the link, it might install malware or steal your login credentials. Pop-up warnings on websites (often claiming your computer is infected) are used to funnel victims into calling scammers, as happened to the widower in the FBI case. Social media ads and search-engine ads might promote a flashy gold investment webinar or “IRS loophole” for gold IRAs – some of these are lead generators for high-pressure salesrooms. Be extremely cautious with any link or attachment you were not expecting; it’s safer to navigate to official websites yourself. And never call phone numbers that appear in unsolicited pop-ups – they likely go straight to scam operators.
Physical World Deception
Not all scams stay online – some involve face-to-face or real-world elements. Scammers may send couriers in person to pick up cash or gold, using things like passcodes and receipts to appear legitimate. Others might operate “we buy gold” booths or shops that intentionally lowball or cheat customers. For instance, bait-and-switch tactics in the refining/buying industry can involve giving an inflated quote by phone to lure a seller, then paying far less once the item is sent in. Always insist on transparency in weighing and testing your gold if you’re selling, and consider getting multiple appraisals. If someone comes to your door or meets you in a parking lot to do a gold deal (either buying or selling), that’s inherently risky – reputable businesses conduct such transactions in secure locations with proper documentation.
Scammers rely on psychological manipulation – creating trust through false identities, creating fear or excitement to cloud judgment, and rushing you before you can verify facts. Staying alert to these tactics will help you recognize a scam early.
Best Practices for Protecting Yourself from Gold Scams
While enforcement agencies work to shut down scams, prevention is ultimately up to each individual. Here are some practical steps and red flags to help you avoid becoming a victim.
Be Skeptical of Unsolicited Offers
If someone contacts you out of the blue offering a gold investment or asking you to sell your gold, guard your personal information and be on high alert. Unsolicited communications – whether a phone call, email, text, or social media message – are a common start to scams. Legitimate dealers and investment advisors usually don’t cold-call people with “opportunities.” It’s safest to ignore or hang up on unsolicited pitches. If the offer came via email or ad, do not click links; if it sounds intriguing, independently research the company or person before responding.
Research the Seller or Buyer Thoroughly: Verify before you buy (or sell)
If you’re considering doing business with a gold dealer, check their background. Look for a physical address, a long track record, and membership in professional organizations. Use resources like the Better Business Bureau to see their rating and reviews. (For instance, Precious Metals Refinery is BBB Accredited with an A+ rating, indicating a strong track record of honesty.) If it’s an investment offer, see if the person is licensed: you can search the National Futures Association’s BASIC database to check registration for commodities dealers or the SEC and FINRA databases for investment advisors. Run an internet search with the company’s name plus words like “scam” or “complaint” to see if others have reported issues. Do not rely only on testimonials or slick websites, which can be fabricated. And never trust contact info given to you by the potential scammer – find an official phone number or site independently to confirm the person’s identity.
No “Guaranteed” Returns or Zero-Risk Deals
A fundamental rule is that if someone promises you a high return or a risk-free way to grow your money with gold, it’s a scam. Period. Gold can be a legitimate investment or store of value, but it is not magical. Its price fluctuates, and anyone claiming you “can’t lose” or will earn absurd returns (like the Ponzi scheme that claimed 45% yearly returns) is lying. Legitimate investment professionals will openly discuss risks. If an offer minimizes or refuses to acknowledge risk – for example, saying “gold never loses value” or “this gold mine is a sure thing” – walk away. Also be wary of charts or graphs that show only gold’s upsides; scammers often cherry-pick data. Do your own homework on gold’s historical performance (spoiler: it has downs as well as ups).
Beware of High-Pressure or Scare Tactics
As noted, scammers often push you to act fast or use fear to manipulate you. Recognize these signs: limited time offers, threats that “this is your only chance to protect your retirement,” unsolicited “urgent” warnings that your bank account is at risk, etc.. Take a step back. No legitimate deal requires you to commit on the spot. It’s perfectly fine to say you need time to think or to consult a trusted advisor. If the person on the other end gets angry, refuses to allow time, or says you must keep this deal secret, those are indicators of fraud. Trust your instincts – feeling pressured is a cue to disengage.
Use Secure and Transparent Payment Methods
If you are buying gold, be cautious with how you pay. Scammers often ask for wire transfers, cryptocurrency, or cash – forms of payment that are hard to reverse. It’s generally safer to pay via methods that have some protection (credit card with a reputable dealer, or an escrow service for large transactions). However, many legitimate gold sellers do use wire or check for payment; the key is knowing who you’re dealing with. Never wire money to a stranger or unknown company based solely on an email or phone conversation. If purchasing from an online retailer, ensure the website is secure (look for https:// and check the domain name carefully for slight misspellings that indicate a fake site). For sellers: if you’re selling gold items, be wary of accepting personal checks (which could bounce) or odd requests like overpaying and asking you to refund the difference. Wait for payments to fully clear. Consider doing transactions at a bank or in a bullion dealer’s office rather than meeting in random locations.
Get Appraisals and Second Opinions
Before investing a large sum in gold coins, bars, or jewelry, seek a second opinion on the value and authenticity of the items. Scammers rely on victims not knowing the true market value of what they’re buying. You can check the current gold spot price easily online – compare that to the per-ounce price you’re being quoted. If there’s a huge gap, ask why. For rare coins, consult a third-party grading service or a knowledgeable coin appraiser to confirm the coins are genuine and reasonably priced. If selling scrap gold or jewelry, consider getting quotes from multiple buyers to ensure one isn’t dramatically undercutting you. Never mail all your valuables to a buyer without at least testing their offer on a small sample first. A reputable refinery or buyer will explain their process and fees transparently, not lure you with a high estimate then slash the payout later.
Don’t Fall for Government or Law Enforcement Imposters
As a rule, no government agency will demand payment in gold. If you get a call/email from someone claiming to be police, IRS, FBI, etc., who tells you to withdraw money or purchase gold bars due to an “investigation” or “security issue,” it’s a scam. Hang up and directly call the agency using an official publicly-listed number to double-check. Real agents do not resolve crimes by taking custody of your savings. Similarly, banks do not send “couriers” to pick up your cash or gold to safeguard it – that’s a pure scam invention. Share this knowledge with elderly family members, as they are frequently targeted with such stories. One protective step: if you or someone you know is prone to responding to such calls, consider having a “trusted contact” – someone who can be consulted before taking any unusual financial action.
Protect Your Digital Identity
Many gold scams start with compromised emails or hacked accounts. Use strong, unique passwords for your email and financial logins, and be careful about security questions (scammers can glean mother’s maiden name, etc., from social media). If you get an email that appears to be from a gold dealer you use, verify it’s legitimate – scammers sometimes send fake invoices or account statements to trick you. Don’t download attachments or software from unknown emails claiming to help with gold investing; these can be malware. Installing reputable anti-malware software and keeping it updated is wise, as is enabling two-factor authentication on accounts when possible. Essentially, treat your email and computer security as part of your financial security – a breach there can lead to scammers persuading you to do things with your money.
Know Where to Report Scams
If you encounter a suspected scam, report it. This helps authorities track and stop criminals. In the U.S., you can report investment or gold fraud to the FTC (reportfraud.ftc.gov) and to the IC3 (FBI’s Internet Crime Complaint Center). State consumer protection offices or attorneys general also take reports. If you actually lost money, also inform local police – sometimes they can coordinate to catch local scammers (as in the fake gold bar case in Alabama). For bogus coin or bullion dealers, you can complain to the CFTC or SEC if investments are involved, or to the BBB. While recovery isn’t guaranteed, law enforcement has been able to seize funds in certain cases and return money to victims, especially if complaints are made promptly.
Staying informed and cautious is your best armor. As the saying goes, if it seems too good to be true, it probably is. Trust your instincts and do due diligence before any significant gold transaction.
Sources
1 https://abc7chicago.com/post/widower-kris-owen-loses-80k-gold-bar-scam-suspect-abdul-afan-mohammed-flees-country-fbi-sets-sting-operation/15952757/
2 https://archives.fbi.gov/archives/newyork/press-releases/2009/nyfo022409a.htm#:~:text=bank%20accounts%20controlled%20by%20REED,investor%27s%20principal%20was%20fully%20guaranteed
3 https://www.ftc.gov/news-events/news/press-releases/2016/06/ftc-charges-gold-silver-investment-scheme-fraud#:~:text=According%20to%20the%20FTC%E2%80%99s%20complaint%2C,ranging%20from%20%241%2C000%20to%20%24300%2C000
4 https://www.justice.gov/usao-wdnc/pr/federal-judge-sentences-coin-and-precious-metals-dealer-and-his-company-defrauding-over#:~:text=Court%20documents%20show%20that%20Tulving,wire%20fraud%20in%20August%202015
5 https://www.sylacauganews.com/local/sylacauga-man-arrested-in-foley-after-counterfeit-gold-bar-scam#:~:text=Officials%20revealed%20that%20Dylan%20Thomas,a%20significant%20sum%20of%20money
6 https://www.numismaticnews.net/us-coins/caution-hundreds-of-websites-selling-counterfeit-gold-silver-coins#:~:text=Coins%20www,of%20fake%20precious%20metal
7 https://www.ic3.gov/PSA/2024/PSA240129#:~:text=The%20FBI%20is%20warning%20the,losses%20of%20over%20%2455%20million
8 https://www.ic3.gov/PSA/2024/PSA240129#:~:text=The%20FBI%20is%20warning%20the,losses%20of%20over%20%2455%20million
9 https://www.justice.gov/usao-cdca/pr/three-defendants-arrested-federal-complaints-alleging-they-knowingly-received-more-13#:~:text=The%20victims%20in%20this%20matter,virtual%20currency%20such%20as%20Bitcoin
10 https://www.ic3.gov/PSA/2024/PSA240129#:~:text=,of%20unknown%20individuals%20who%20contact
11 https://www.cftc.gov/PressRoom/PressReleases/8881-24#:~:text=Authority%20,ever%20profit%20from%20their%20investments
12 https://www.cftc.gov/PressRoom/PressReleases/8881-24#:~:text=Authority%20,ever%20profit%20from%20their%20investments
