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Investing in a gold IRA or a silver IRA is potentially a smart move to diversify your retirement portfolio and protect your wealth.
However, you must be aware of the potential risks and scams associated with gold IRA investments.
In recent years, there have been instances of fraudulent practices by a few dishonest gold IRA sellers and this tarnished the reputation of the entire industry.
You need to understand the common types of gold IRA scams. You need to be able o identify red flags and follow investing best practices when safeguarding your retirement savings,
Learn it right below.
- Understanding Gold IRA Scams (Examples)
- How to Protect Yourself from Gold IRA Scams
- Finding Reputable Gold IRA Companies
- Identifying Red Flags in Gold IRA Companies
- Gold IRA Scams FAQ
Table of Contents
Understanding Gold IRA Scams (Examples)
Gold IRA scams take various forms, with scammers targeting unsuspecting investors and jeopardizing their hard-earned retirement savings.
You must be aware of the different types of gold IRA scams so you don’t become their victim.
Here are the common gold IRA scams to watch out for.
- Non-delivery or Ponzi Scheme Scams
- Hidden Fees and Overpayment Scams
- Rare Coin Valuation Scams
- Home Storage Gold IRA Scams
- Counterfeiting Scams
Non-delivery or Ponzi Scheme Scams
In a non-delivery or Ponzi scheme scam, a company promises investors high returns on their investment by pooling funds from new investors to pay dividends to early investors.
However, this scheme works for a while before collapsing, leaving unsuspecting investors with significant financial losses.
Always be cautious when investing. Be extra cautious of investment opportunities that promise unrealistic returns.
Hidden Fees and Overpayment Scams
Some dishonest gold IRA sellers subject investors to exorbitant fees or overpayment for storage or transactional operations. These hidden fees rapidly deplete an investor’s hard-earned money, leading to disappointment when promised return on investment never materialize.
You must thoroughly review all fees and costs associated with a gold IRA investment before you commit to any transactions.
It’s also a good idea to hire a professional financial advisor to help you.
Rare Coin Valuation Scams
Unscrupulous dealers charge high premiums for rare coins, artificially inflating their values to manipulate investors into paying more. These scams often involve regular coins to make them appear more valuable than they actually are.
When dealing with numismatic coins you should seek expert advice to avoid overpaying for rare coins that don’t hold their purported value.
Home Storage Gold IRA Scams
Another type of gold IRA scam is scammers persuading individuals to store precious metal bullion in their own homes. These companies promise higher returns from investor’s retirement savings accounts by avoiding costs that come from depository precious metal storage.
However, storing precious metals at home carries significant risks, including theft and natural disasters.
Plus, IRA approved gold must be stored in certified gold IRA depositories. It’s illegal to store IRA account precious metals at home.
Counterfeiting Scams
Counterfeiting is a prevalent gold IRA scam, where scammers craft counterfeit coins that resemble the real thing. Duped purchasers soon discover these coins are worthless and this results in a significant financial loss.
To avoid falling victim to counterfeiting scams, you should hire an expert to validate your purchase before money exchanges hands.
Or you can work with a legitimate gold IRA company which guarantees you won’t be scammed out of your money.
There are only a handful of companies I recommend.
Click here to jump to the section of this guide that talks about reputable gold IRA companies you can trust.
How to Protect Yourself from Gold IRA Scams
Here are the steps you can take to proactively protect yourself from gold IRA scams:
- Choose a Reputable Gold IRA Company
- Ensure Proper Storage and Insurance
- Stay Informed and Vigilant
- Report Suspected Scams and Seek Legal Assistance
Choose a Reputable Gold IRA Company
Selecting a reputable gold IRA company is crucial.
You won’t get scammed if you pick a legitimate gold IRA company to open your precious metals IRA account.
Research customer feedback on verified review sites like Trustlink, Trustpilot and especially Better Business Bureau.
Look for precious metal dealers with a history of positive customer reviews and a verifiable address. Avoid companies with numerous negative reviews or suspicious business practices.
Avoid companies that have many unresolved complaints. Unresolved customer complaints strongly hint that particular gold IRA company is either an outright scam or at least an unethical and shady business.
To give you an example, Birch Gold Group are one of the best gold IRA companies operating on the US market (note: you can read my Birch Gold Group review here).
They promptly resolve all customer complaints that get submitted to BBB. It’s a sign they’re a legitimate precious metals dealer company.
Ensure Proper Storage and Insurance
Gold and silver bullion as part of an IRA must be stored in an IRA-approved depository or vault.
You need to know this rule so you avoid schemes that promote self-storing precious metal IRA bullion. The IRS forbids this!
Pro tip: picking a reputable gold IRA company ensures you’ll get connected with a legitimate and trustworthy custodian.
It’s part of the service gold IRA companies provide. You also need to consult with a knowledgeable attorney to ensure full compliance with the IRS guidelines.
Stay Informed and Vigilant
You also need to stay informed about market trends, gold prices, and the reputation of gold IRA companies. Regularly review the performance of your investments and adjust your portfolio as needed.
Be cautious of unsolicited offers, high-pressure sales tactics, and unrealistic promises. Conduct thorough research and consult with experts before making any investment decisions.
Pro tip: you’ll get lifetime support if you pick Augusta Precious Metals as your gold IRA company of choice.
Part of this lifetime support is that you can always call them and get updates on what’s going on with the economy and gold prices.
It’s an exclusive offer valid for all Augusta’s customers regardless of the size of their investment.
Report Suspected Scams and Seek Legal Assistance
Contact relevant authorities immediately if you suspect that you been duped by a gold IRA scam,
Contact agencies like the Commodity Futures Trading Commission, the Federal Trade Commission, the US Securities and Exchange Commission (SEC) and local law enforcement.
Next, seek legal assistance to protect your rights and explore options for recovering your investment.
Finding Reputable Gold IRA Companies
The risk of gold IRA scams exists and always will. But, there’re still reputable companies in the precious metals market that can help you safeguard your investments.
Here’s the best gold IRA company for you to consider.
Augusta Precious Metals
Augusta Precious Metals is a reliable gold IRA company that offers excellent customer service and competitive fees.
With over a decade of experience, Augusta Precious Metals has been recognized as a premier gold company. They provide educational resources and have a positive reputation among customers (they currently have exactly zero complaints on their BBB profile)
Note: Augusta Precious Metals are a rare precious metals IRA company that “force” you to sit in a one-on-one conferred with Devlyn Steele (Devlyn Steele a professional economist and Augusta’s director of education).
During that web conference, Devlyn will explain:
- How gold and silver have helped retirement savers hedge inflation
- How does Federal Reserve action affect the economy
- Concerns about the future of the U.S. dollar
- How to avoid falling for gimmicks & high-pressure tactics when buying gold and silver
You can read my review of Augusta Precious Metals here.
Identifying Red Flags in Gold IRA Companies
Here are some warning signs to watch out for to protect yourself from gold IRA scams.
- High-Pressure Sales Tactics
- Phoney IRAs
- Nonexistent Purchases
- Selling Collectible Coins
- Misleading Contracts
- Unsolicited Offers
High-Pressure Sales Tactics
Be cautious of salespeople who use high-pressure tactics to convince you to invest in a gold IRA.
Treat claims of guaranteed high returns or once-in-a-lifetime opportunities with skepticism.
Legitimate gold IRA companies focus on providing accurate information and educating investors rather than using aggressive sales tactics.
Legitimate gold IRA companies also have large disclaimers telling past result don’t guarantees future success.
For example, here’s Augusta’s disclaimer on their website.
Phoney IRAs
Some scammers try to sell phoney gold IRAs, convincing you to transfer your money to their fraudulent scheme. It’s essential to work with reputable gold IRA companies and verify their credentials before making any investments.
Research the company’s track record, check customer reviews, and ensure they have the necessary licenses and certifications.
Nonexistent Purchases
Ensure your gold IRA custodian actually purchases physical gold on your behalf and stores it securely at an insured depository.
Some scammers will take your money without buying any gold or silver bullion.
Ask for certifications and documentation that confirms your investment is legitimate, properly stored and insured.
For example, Tyler Gallagher, the CEO of Regal Assets, cheated dozens of people out of millions dollars. He convinced people to invest in gold and silver with his company (Regal Assets). Then he used their money for himself while not buying the coins and bar he was supposed to.
He basically stole these people’s retirement funds.
It took a while for him to be found out but by that point the damage had already been done.
When you work with reputable gold investment companies they’ll make sure to deliver all the paperwork to you on time.
Note: Oxford Gold Group is a recent example of gold IRA company taking customer’s money and not buying gold bullion with it.
Instead, they misappropriated it and currently the company is under investigation by both the California Department of Financial Protection and Innovation and the U.S. Commodity Futures Trading Commission.
Criminal investigation is going to take a while and in the meantime dozens, if not hundreds of customers are left without their retirement money.
It’s a sad but perfect example of a gold IRA scam.
Selling Collectible Coins
Legitimate gold IRAs is all about buying gold as a commodity. It doesn’t involve buying collectable coins. Be cautious of sales pitches that encourage you to buy rare coins for your gold IRA. It’s an obvious scam and a fraud.
Numismatic coins aren’t IRA-approved.
Misleading Contracts
Read all contracts thoroughly before signing any agreements, including those related to setting up a gold IRA. Scammers usually include unfavorable terms or misleading clauses in their contracts.
Consult with a qualified attorney to ensure the contract’s legitimacy and protect your interests.
Here’s an example of Augusta’s transaction agreement. It’s an example and what you should look for when dealing with any other company.
Unsolicited Offers
Legitimate gold IRA companies typically do not cold-call individuals to drum up business. Be cautious if you receive unsolicited offers or calls from salespeople trying to convince you to invest in a gold IRA.
Reputable companies respond to customer inquiries and provide information without resorting to aggressive sales tactics.
Gold IRA Scams FAQ
How Do Gold IRA Scams Work?
Gold IRA scams work by using high-pressure tactics to convince potential victims to purchase overpriced, fake gold and fake silver coins or bars.
The scammer then takes the money and doesn’t deliver the goods, or they deliver fake coins and bullion.
These types of scams leave investors without their hard-earned money, feeling dejected and bitter about gold and silver IRAs.
What is a Gold Coin Scam?
Gold coin scam is when a scammer sells to an unsuspecting party gold coins at prices several times higher than the spot price of gold on that day.
Often markups go as high as 300% leaving investors at a loss and ruining the chances of any future profit as the price of gold increases.
What is a Gold Bar Scam?
There are several types of gold bar scams. Here are the two most common.
First, someone may try to sell you a gold bar that looks like it’s made from gold, but it’s actually made from some cheaper material (for example tungsten).
Second, inheritance fraud. You supposedly inherited gold from a deceased relative and you just need to pay for shipping.
What is a Cash for Gold Scam?
A cash for gold scam is a type of fraud that involves convincing people to give money in exchange for gold products or financial returns.
The scammer will use high-pressure tactics to convince you to buy overpriced gold coins or jewelry.
But the supposed gold bullion doesn’t exist and you’ll just be losing your money.
Is Buying Gold Online a Scam?
No, buying gold online isn’t a scam. There’re plenty of excellent precious metals dealers which sell gold and other precious metals online.
Some of these precious metal dealers double as gold IRA companies that can help you open a gold IRA account with them.
Is Selling Rare Coins for Gold IRA a Scam?
Yes, selling rare coins for your gold IRA is a scam. It’s because rare coins aren’t IRA-approved and you can’t hold them as a part of your gold IRA.
You shouldn’t do business with a precious metals dealer that offers to open a gold IRA account for you and fill it with numismatic coins.
It’s not possible and it’s against the law.
Is Selling Palladium Coins and Bullion for Gold IRA a Scam?
No, selling palladium coins and bullion for gold IRA isn’t a scam.
Palladium is an IRA-approved precious metal and you can have it as part of your gold IRA.
An excellent company that offers palladium bullion to investors is Bishop Gold Group. Bishop Gold won’t sell you fake palladium and they’re one of the best US precious metal dealers.
You can read my review of Bishop Gold Group here.
Is Selling Platinum Coins and Bullion for Gold IRA a Scam?
No, selling platinum coins and bullion for gold IRA isn’t a scam.
Platinum is an IRA-approved precious metal and you can have it as part of your gold IRA.
Make sure you buy work with a legit gold IRA company as there’s plenty of fake platinum on the market.
Is Selling Rhodium Coins and Bullion for Gold IRA a Scam?
Yes, selling rhodium coins and bullion for gold IRA is a scam. Rhodium is not an IRA-approved precious metal and you can’t have rhodium bullion as part of your IRA.
Is Selling Jewelry for Gold IRA a Scam?
Yes, selling jewelry for gold IRA is a scam.
Jewelry is not IRA-approved and the IRS consider jewelry a collectable and doesn’t allow collectables in IRAs.Â
How is the Age of a Gold IRA Company Correlated With Legitimacy?
The age of a gold IRA company is positively correlated with the company’s legitimacy. The older the company is, less likely they’re a scam.
It’s because older IRA companies have had more time for them to go under because of defrauding their customers.
You don’t need to do business with the gold IRA company that’s been in the business the longest.
A gold IRA provider is probably legit if they’ve been operating for 7+ years, and if they have very few legitimate complaints and lawsuits to their name.
Does Having Complaints on BBB Indicate a Gold IRA Company is a Scam?
No, having complaints on BBB doesn’t indicate a gold IRA company is a scam.
Instead, a telltale sign is having complaints that have never been addressed and resolved.
For example, Birch Gold Group is a legitimate precious metal IRA company. And they make sure to resolve all complaints potential customers have.
Take a look, in this year alone they successfully resolved 23 customer complaints.
Pro tip: there are more than 15 gold IRA companies operating in the US market. And among those Augusta Precious Metals is the only one who has never gotten a single complaint on BBB.
And they have hundreds of positive verified customer reviews.
Do Repeated Calls from a Gold IRA Company Indicate It’s a Scam?
Yes, repeated, persistent calls from a gold IRA company are a telltale sign that company is a scam, or at least very shady.
Legitimate gold IRA companies don’t chase potential customers. Instead, they educate them and then let them decide if investing in gold and silver is the right move or not.
Look elsewhere if you’re continuously pestered by some company to invest in precious metals.
Is Not Having a Refund Policy a Sign of a Scam Gold IRA Company?
No, it isn’t a sign of a scam if a gold IRA company doesn’t offer a refund policy.
There are plenty of legitimate companies in the gold IRA niche and other niches that don’t offer refund guarantees. This doesn’t make them scams.
For example, Noble Gold is a reputable gold IRA company with years of experience in servicing the US market.
However, they don’t have a refund policy and don’t issue refunds in any instance.
Obviously, it’s better for you as a customer to work with gold IRA companies that have refund policies in place as a form of customer protection.
For example, Augusta Precious Metals has an excellent refund policy and they’re the gold IRA company I recommend to any American saver or investor.
Does Advertising on Facebook Aggressively Indicate a Gold Investment Company is a Scam?
No, aggressive Facebook advertising doesn’t indicate a certain gold investment company is a scam. Facebook is a legitimate platform and many potential investors spend money there. The gold IRA companies using Facebook ads are trying to reach those people and get them interested in their services.
Gold and Silver IRA Scams (Conclusion)
Investing in a gold IRA is potentially a wise decision to diversify your retirement portfolio and protect your wealth and financial future.
However, you should be aware of the potential risks and scams associated with gold IRA investments.
You can safeguard your retirement savings from fraudulent schemes by understanding common types of gold IRA scams, identifying red flags, and following best investing practices.
Work with reputable gold IRA companies, stay informed and be vigilant in your investment decisions.
References:
- Are Gold IRA’s a Scam?- https://www.reddit.com/r/investing/comments/6b9vpq/are_gold_iras_a_scam/
- Lies Versus Facts: The Truth Behind
Gold and Silver IRA Scams- https://www.cftc.gov/sites/default/files/2024/03/MetalsIRALies_0.pdf - Customer Advisory: Beware of Gold and Silver Schemes Designed to Drain Your Retirement Savings- https://www.cftc.gov/LearnAndProtect/AdvisoriesAndArticles/CustomerAdvisory_COVID19PreciousMetals.htm
- 5 common gold IRA scams and how to avoid them- https://www.bankrate.com/retirement/how-to-avoid-gold-ira-scams/
- Beware of Precious Metal Scams- https://disb.dc.gov/page/beware-precious-metal-scams
- 6 Gold IRA Scams to Avoid- https://lendedu.com/blog/avoid-gold-ira-scams/
- What’s Up With All The Gold IRA scams?- https://www.quora.com/Whats-Up-With-All-The-Gold-IRA-scams
Nikola Roza
Nikola Roza is a blogger behind Nikola Roza- SEO for the Poor and Determined. He writes for bloggers who don't have huge marketing budget but still want to succeed. Nikola is passionate about precious metals IRAs and how to invest in gold and silver for a safer financial future. Learn about Nikola here.
