FRANKFORT, Ky (LEX 18) Attorney General Andy Beshear issued a scam alert Thursday after two Kentuckians reported losing nearly $900,000 this year to scammers promising access to gold markets and millions in investment returns.
A Fayette County resident recently lost $420,000 to a con artist on Facebook who said “investing” in a foreign gold market would quickly generate millions of dollars. An Inez resident also “invested” $475,000 with a con artist who guaranteed gold.
Beshear’s office said that gold scammers typically attract victims with deceptive sales scripts, stating that the precious metal markets can double and triple in just 30-days and are less risky than traditional IRAs, 401(k)s. The scam typically ends with the victim sending money to a scammer to purchase gold they never receive.
Beshear said that the two reported victims in Kentucky were senior citizens who handed over their life savings to a sham gold investor.
“Gold scammers are turning Kentuckians’ fear of losing their nest egg into a reality,” said Beshear. “My office is working to stop these appalling con artists, help victims recover and prevent other families avoid the catastrophic outcomes of losing their life savings.”
Beshear said there are legitimate investments in gold, which can diversify an investment portfolio and help to protect against inflation and economic uncertainty, but before rushing to invest in gold Kentuckians must be wary of fraud schemes.
The Federal Trade Commission offers guidance to follow before purchasing gold.
- Know the price of gold is not guaranteed. Over time the price can both increase and decrease in value.
- Compare prices before making a purchase. Banks, brokerage firms, coin dealers and precious metal dealers often charge more than the value of the gold.
- Consult with a reputable dealer, financial adviser and independent appraiser who has specialized knowledge before making an investment.
- Refuse any sales pitch that requires you to act quickly and never send money using untraceable methods of payment.
- Research the seller online and contact the Attorney General’s Office of Consumer Protection hotline at 888-432-9257 for assistance in determining a scam. Kentuckians can also file a consumer complaint with Beshear’s office online.
Beshear said con artists are turning more and more to social media to scam senior citizens, and children, grandchildren and caregivers of seniors should take active steps to safeguard their loved ones on online.
One of Beshear’s top priorities is to protect Kentucky consumers, especially seniors from scams, abuse and exploitation.