Goldline - Endorsed by Glenn Beck - Hit With Massive Criminal Complaint

publication date: Nov 17, 2011
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Two and one-half years ago - in May of 2009 - I warned readers that Glenn Beck was dispensing terrible investing advice. Time has proven me correct. I had also warned about Goldine, a gold company Beck was in bed with. As I highlighted in my last update in July, 2010, the Santa Monica, CA-based Goldline was being accused of shady sales practices.

Now, Goldline has been slapped with a 19-count criminal complaint by the Santa Monica City Attorney's Office. The complaints largely center around Goldline steering customers away from (low profit margin) gold bullion, which is what they heavily promote in their advertising, and instead into (high profit margin) gold coins which I have repeatedly warned readers against:

"The complaint charges that Goldline runs a bait and switch operation in which customers, seeking to invest in gold bullion, are switched to highly overpriced coins by using false and misleading claims.

The charges, all of which are misdemeanors, include grand theft by false pretenses, false advertising, and conspiracy.

...The specific acts alleged against them as part of the conspiracy include:

  1. Training salespeople to “get the money in” from customers on the promise of delivering gold bullion, with the intent to later switch the sale to far more overpriced coins;
  2. Training salespeople to turn over, or “T.O.,” transactions in which the customer sought to buy bullion, to senior salespeople for the purpose of converting the customers to buying the overpriced coins;
  3. Paying salespeople approximately 2,000 percent more commission for sales of the overpriced coins than for sales of bullion;
  4. Training salespeople to induce in customers fear of government confiscation of bullion and to tell customers that the overpriced coins were exempt from such confiscation;
  5. Training salespeople to induce in customers fear of the alleged "public" or "reportable" nature of bullion transactions, while telling customers that the overpriced coins are "private" or not "reportable";
  6. Training employees to disguise the more than 50 percent markup on the overpriced coins when answering customers’ questions on the subject;
  7. Reprimanding a salesperson for making a large bullion sale and failing to convince the customer to buy the overpriced coins;
  8. Reprimanding a salesperson for allowing a customer to undo a transaction in which the customer had been converted from buying bullion into buying the overpriced coins; and
  9. Punishing salespeople for failing to sell a certain amount of the overpriced coins in a specified period, while not counting Bullion sales toward that quota.

The alleged acts of false advertising by Goldline...include making the following false or misleading statements to the public:

  • Offering gold bullion for sale, in commercials and on Goldline's website, with no intention of selling it;
  • Stating that bullion could be "purchased online" with a button on Goldline's website, when in fact it could not be purchased online



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Copyright Eric Tyson, 2008 - 2018 all rights reserved.

Eric Tyson is the only best-selling personal finance author who has an extensive background as an hourly-based financial advisor and who does not accept speaking fees, endorsement deals or fees of any type from companies in the financial services industry or product or service providers recommended in his articles, books and his publications.

 

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