If it sounds too good to be true, it probably is. Although we refer to the conventional pathways to purchasing gold, I’m sure over time as you begin immersing yourself in the precious metal’s community you will find yourself looking for deals in all places. Your ears will begin to perk up when you hear of any bargain that comes in right at, or under, spot price.
This scam is to remind you that whether or not it is a licensed business or an individual on the street, having your gold or silver’s legitimacy confirmed is a must before following through with a purchase. One way of knowing is dealing with a well known dealer with a great reputation. Learn a lesson from this woman.
Last week, in Bakersfield, CA, a scammer approached a woman in a Big Lots expressing her desperation to sell the gold bars she had in her possession to pay for an emergency surgery for her father. Her scamming-sidekick soon arrived saying he had found a store to purchase the bar for $12,000 but had to wait until 5 p.m. to go back and sell the next bar due to the low amount of cash the store held on hand.
The woman they approached was convinced to purchase one of the bars of gold for $1,000 – with the scam artists telling her that she can return to Kmart later to flip that bar for $12,000. However, after they made the exchange, the scammers never returned. Soon after the woman found out that the gold bar wasn’t even gold. She was out $1,000 with a bar of metal that didn’t add up.
I’d like to think that most precious metals investors would know better than to buy a gold bar off of a stranger in a home goods store (100 oz. of gold = approx. $173,000 today), but you never know. Some ways to stop a scam before it happens is get to know your dealer by researching their company online or searching for reviews from their past customers. Also, if you are making a purchase in a barter like fashion, trade contact information and contracts to ensure that if the purchase is bogus, you have a way out. Finally, be alert and educated on the metal you so hope to own. Share these kind of stories with family members along with the Peter Schiff’s Gold Scam Report to be well-prepared for your first…or 50th purchase. (Download the report for free in the top right hand corner.)
Note: The two suspects of this gold bar scam have not been arrested, and the police are asking for the community’s help. If you are in the area and have a tip on these scammers you can call Detective Galland at 661-326-3858.
There seems to have been a rash of these cases in Southern California recently. In one case the sick relative was a young child, and the accomplice who checked the value of the gold (claimed it was worth $20,000) pulled out wad of cash and bought the first “gold bar”. The victim then agreed to pay $7,000 for the second “gold bar”. Once the victim brought the bar to a legitimate gold dealer, she found that it was worthless. This all happened in front of a Food 4 Less store.