CFTC taking action against rare metal investment businesses

For the third time in the last little while, the CFTC has taken action against precious metal investors. The latest company to be closed down is American Precious Metals, LLC. These corporations have been offering Ponzi scheme style investments in precious metals.

American Precious Metals LLC lawsuit

American Precious Metals LLC was a business based in Lake Worth, Florida. Consumers were pressured by telemarketers into buying gold, silver, platinum and palladium investments being sold. The salespeople claimed that the business would store the physical metals for the customer and even finance part of the purchase after a significant down payment was made. The consumer would get a several hundred percent return on the investment from the business though. The company gave individuals short-term loans for investment in very special metals. Still, these metals didn’t really exist. The company also never registered with the FTC or Commodity Futures Trading Commission as an investment business. Regulation on precious metal was not followed by the company. It also violated the Telemarketing and customer Fraud and Abuse Prevention Act. The company’s assets have been frozen now.

Precious metals costing more

Precious metal investment scams have become more prevalent recently. This is because there has been an increase in the precious metals price tags. There has been a huge increase in gold prices in the last year. They have gone to over $1,500 from being at $1,200. Silver and other precious metals have experienced a similar price jump. Some of this increase is from the truth that precious metals are considered a “safe haven.” You can never go wrong investing in it. Some industry watchers have warned that gold and precious metals are getting close to bubble status, with costs that have expanded beyond their “real” value.

The brightest way to invest

Investing isn’t always safe. It can be dangerous in fact. You are able to get your own precious metals and store them. Make sure whoever you invest with is at the Better Business Bureau. Always check there for information. Do not invest in corporations that you can’t verify. Go to the Federal Trade Commission or Commodity Futures Trading Commission to verify the companies.

Articles cited

FTC

ftc.gov/os/caselist/1023212/110517americanpreciousmetalscmpt.pdf

Futures Mag

futuresmag.com/News/2011/5/Pages/CFTC-charges-Fla-firm-with-precious-metals-fraud.aspx