CFTC Advisory Warns Customers to Carefully Assess Precious Metals Pitches Touting CARES Act Rules

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CFTC

CFTC Advisory Warns Customers to Carefully Assess Precious Metals Pitches Touting CARES Act Rules

August 5, 2020

CFTCWashington, D.C. — The Commodity Futures Trading Commission today issued a Customer Advisory educating the public about unregistered gold and silver dealers advising investors to use relaxed rules under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to purchase precious metals. This Customer Advisory— the fourth issued by the CFTC in response to the COVID-19 (coronavirus) pandemic— was prepared by the Office of Customer Education and Outreach (OCEO).

Specifically, the CFTC has observed a growing trend of precious metals promoters and dealers encouraging investors to use relaxed rules under the CARES Act to convert their retirement savings into investments of gold or silver coins, self-directed gold individual retirement accounts (IRAs), or make leveraged purchases of physical metals. These schemes often gouge unsuspecting customers with expensive premiums and hidden fees.

“As the CFTC observes new trends in the market we believe customers should be aware of, we will not hesitate to provide that information to the public,” said CFTC Chief Communications Officer and Director of Public Affairs Michael Short. “With many Americans facing financial hardship due to the global coronavirus pandemic, heightened vigilance is of utmost importance.”

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