Concerns over the coronavirus are causing the price of gold to spike. Investors are taking advantage of this surge, but so are scammers.
Gold was trading at just below $1,650 on Tuesday. Jut a few weeks ago; it was above $1,688.60, this being the highest its been since 2013.
As the demand for gold rises, scammers will pretend to be legitimate gold traders. With counterfeit products becoming more advanced, it is now easier than ever to fool investors.
Types of Scams
The most common type of gold scam is when scammers tell investors that standard gold bullion coins are rare and can than overcharge them.
Another is the “empty vault” method; this is when the dealer tells the customer that they have a safe space for storage of their gold. Unfortunately, this space does not exist, and the dealer takes the gold. Your best bet is just to put it in a safety deposit box.
You also must be aware that scammers are using dating apps. In 2019 app users were scammed when scammers would ask the person to forward the gold because they needed it to get into the US.
Scammers will also sell counterfeit gold below the market value in marketplaces on the internet. Fakes are becoming more advanced; it may be hard to tell and should have a test. It isn’t until they go to sell it they find out it’s not real—the easiest way to know if it’s real or not is to understand its dimensions and weight.
Gold is one of the densest elements; Only a few rare metals have a higher density than gold. If the dimensions and weight of the gold match the manufacturer’s specifications, the product is likely real.
Infomercials use Tare used to have people who might want to invest call. These often elderly and vulnerable investors who are then pitched a vastly overpriced product, with high-pressure sales techniques and promises of wealth.
Gold scams often get close to there victims, establishing
Many scams revolve around the gold buyer’s effort to avoid reporting and taxes.
Gold experts say the best way to avoid scammers is to only deal with established and reputable dealers. You can verify Brokers’ licenses at the Financial Industry Regulatory Authority (FINRA) website. You can also look at reviews.
Look for reputable dealers that commonly accept products, like hallmarked bullion products or sovereign-issued bullion coins.
“Importantly, insist on well-established storage arrangements. Beware of ‘off-market’ products.”