Your money is precious. You want to grow it to fuel your retirement and protect your family’s financial wellbeing. There are plenty of gold investments that may provide you with the financial security you’re after, but there’s also no shortage of scammers looking to rip you off.
Knowing the difference between a reputable gold dealer and a shadowy huckster could be the difference between retiring early and living your golden years in destitution. Here’s what the most trusted gold and silver coin dealers have in common.
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What the Most Trusted Gold and Silver Coin Dealers Have in Common
Whether you’re new to gold investing or a financial conservative that refuses to be ripped off, you need to know you can trust your gold and silver coin dealers. Anything less than complete confidence will likely result in tragic losses over the short or long term.
1. History and a Solid Reputation
Look for a dealer that has been in business for a long time. Since gold is a long-term investment, it makes sense to do business with a coin dealer that has passed the test of time. A dependable dealer will have a Better Business Bureau listing in good standing, and a surplus of legitimate positive reviews online.
2. Physical Location
A physical location is also important. Online dealers are harder to trace, and can be harder to bring to justice in the event of fraud. Additionally, make sure the address is an actual office, not just a P.O. Box.
3. They’ll Send You Your Investment
If you’re not purchasing from a dealer in person, the dealer should offer to send you your investment to your address. A reputable gold and silver dealer will put your investment in your hands, without the complicated runaround.
How to Spot a Reputable Gold Dealer
As you’re researching gold dealers, make sure the answers to all of these questions is “yes.” Otherwise, find a gold dealer that can. Consider these questions a checklist for any precious metal purchase:
- Is the price reasonable compared to industry numbers?
- Can I put my investment in my hand?
- Does the dealer allow me to do my own research and take my time with my decision?
- Does the dealer have legitimate reviews that back up its reputation?
- Does the dealer have a respectable history in the precious metals industry?
- Does the dealer have a significant amount of satisfied customers?
- Does the dealer offer a buy-back policy?
You should feel good about who you’re purchasing from. The dealer should treat you with respect, have a stellar reputation in the industry and deliver on its promises.
According to AARP, more than 10,000 Americans have been victims of precious metal scams, losing at least $300 million between 2014 and 2015. Many victims don’t even know they’ve been scammed.
A 2017 report by the North American Securities Administrators Association (NASAA) found gold and precious metal fraud merchant target seniors because that group is most likely to want to supplement retirement savings and are likely to respond to emails or phone calls.
Gold fraud is prevalent around the world. In 2019, Hong Kong police arrested 14 people who allegedly defrauded 7 victims of $80 million, CNN reports. In 2018 in Massachusetts, a pair of con artists secured more than $300,000 from 3 people who thought they were purchasing gold.
We don’t want this to happen to you. Read on for a guide on common gold scams and red flags, what to do if you’re a gold scam victim and how to find a trustworthy gold and silver dealer.
Common Gold Scams and Red Flags
One type of gold scam is when the seller says that what they’re selling is worth more than it actually is. In other cases, investors purchase “gold” that doesn’t exist, or fool’s gold.
Here are some warning signs to look out for when you’re considering gold investments.
1. You’re Told You’ll Get Rich Quick
Any promise of a guaranteed or quick return is a red flag. Every investment carries inherent risk. With some exceptions (windfalls, ratio trading, freak spikes in demand), gold and precious metals are long-term investments. Anyone who guarantees too-good-to-be-true gains in the short term is looking to scam you.
2. You’re Contacted Via Cold Call
Cold calling is a classic tactic of gold scammers. Once they have your attention, they try to bully you into making an investment that doesn’t make sense. Reputable gold sellers don’t randomly call people out of the blue, and they definitely don’t pressure you into an investment.
Also, beware of a bait and switch tactic, where you seek information about a product (maybe from an online ad), but then the person you talk to tries to sell you on a “rarer” product that requires a fast deal. Take your time and do your research before any purchase.
3. You Can’t Find Legitimate Reviews Online
A legit gold business will have a listing with the Better Business Bureau and will feature real testimonials from prospective customers.
If you’re having trouble researching a gold dealer through online research on reputable sites, that’s a red flag. When some gold scammers are found out or need to get someone off their trail, they’ll disappear online and change their name. If you can’t find trustworthy information about the dealer online, you should take your business elsewhere.
4. The Prices Are Much Higher Than Industry Standard
Before committing to a gold investment, check the gold spot price to compare your offer versus what’s happening in the industry. While a mild markup is likely because you’re purchasing from a business, you should inquire about all fees, and perform research to judge the deal.
Any gold dealer selling you coins should provide you with a history of the coins. Use this to conduct further research and weed out scammers.
5. You’re Not Able to Get Ahold of the Gold
If the dealer is giving you the runaround about getting your gold, that’s a bad sign. They might offer to send you a certificate of ownership, which could be worthless. Or, they might promote free storage, when they’re really storing zero commodities for you.
You want to be able to have the gold in your hand. Insist on having it delivered, or pick it up in person. If the dealer refuses, don’t do business with them.
6. The Dealer Has No Buy-Back Policy
A reputable dealer knows the value of gold and may be open to buying back yours in the future. At the very least, there should be some sort of formal buy-back policy information available. If there’s none, you may just be getting fool’s gold.
What to Do If You Get Scammed
Being the victim of a gold scam is a violating experience. You’ve entrusted your money with a malicious party that has taken advantage of you. You deserve justice. Taking action can help protect others from the same scammer.
- First, contact non-emergency police services. They can help you create a case, set up an investigation and gather evidence.
- Next, talk with a lawyer. They can further help you set up a case and gather evidence.
- Notify your bank. If you used your banking or credit card information to invest, you want to have that changed so that the fraudster can’t use it further.
- File a complaint with the Federal Trade Commission (FTC). The FTC may be able to provide you (and your law enforcement and legal team) with helpful information for a case.
Buy From the Most Trusted Gold and Silver Coin Dealers
At RME Gold, you can trust that we prioritize the best interests of our investors. Our CEO, Jim Clark, has more than 43 years of experience in the precious metals industry. We’ve served thousands of customers locally and nationwide.To get more information on investing in gold from a dealer you can trust, contact RME Gold.