AG Curtis Hill Praises Injunctions Against Precious Metals Dealers That Scammed Seniors

Attorney General Curtis Hill announced today that a federal judge has issued preliminary injunctions against two precious metals dealers and associated companies accused of soliciting nearly $200 million from seniors and other vulnerable investors nationwide by touting precious metals at grossly inflated prices that were not disclosed.

The injunctions come weeks after Attorney General Hill, the Office of the Indiana Secretary of State and the Indiana Securities Division joined a nationwide enforcement action to halt the fraud scheme, allegedly perpetrated by defendants Metals.com and Barrick Capital, Inc. The action is the largest joint filing with state regulators in Commodity Futures Trading Commission history.

The companies are accused of soliciting $185 million from at least 1,600 seniors and other investors. The companies’ overcharges averaged from 100% to more than 300% over the prevailing market price. When questioned by customers about the value of the metals they purchased, the companies falsely claimed that they were rare and carried a premium far above the base melt value. In reality, the metals were significantly less valuable than the companies claimed.

“Not only did these companies severely misrepresent the value of their precious metals, they targeted elderly Hoosiers, who are among our most vulnerable citizens,” Attorney General Hill said. “We are pleased that the court has taken preliminary action to stop the scheme, and we hope that our evidence of their fraud leads to additional punishment.”

The preliminary injunctions, issued by a judge for the U.S. District Court for the Northern District of Texas, temporarily enjoin the companies and their affiliates from entering into any transactions involving “commodity interests” and from accepting money from any person for the purpose of purchasing or selling securities or equities, among other restrictions. They are also prevented from destroying, altering or disposing of any records related to their business activities.

The lawsuit seeks to permanently enjoin the companies from any commodity-related activities, as well as civil monetary penalties and additional relief.