The Gold Bar Scam: How to spot it, prevent it, and report it

Author

Seth Combs
July 26, 2024

If you’ve been a victim or know a victim, please contact us and we will try to assist

Quick Overview

The Rise of American Scammers

Every week, we cover different scams targeting seniors. Typically, I talk about criminal organizations overseas in places like India, Africa, and Asia. What I haven’t covered are the scams instigated by criminals here in the US.

This week, we’re covering the gold bar scam. This scam exploits the trust and savings of older adults, and the criminals are typically in the same town or county.

Awareness is key. 

A 74-year-old man from Bethesda made nine trips to the gold store to convert $1 million. Luckily, he came across a news report about a similar scam before delivering the gold to the criminal. He contacted the authorities who setup a sting operation and arrested the scammer.

Be sure to alert your loved ones about the gold bar scam. Read below to learn about the scam, how to spot it, and how to report it.

Stay safe out there,

The Gold Bar Scam Targeting Senior Citizens

The FBI has put out repeated warnings about the gold bar scams. Rochester Supervisory Special Agent, Ryan Braley is trying to get the word out.

Braley commented, “anyone who’s worked these kinds of cases will tell you that there are few things more heartbreaking than sitting at the kitchen table with an elderly victim when they come to the realization that they have lost everything that they worked their entire lives for."

The FBI is working on educating the public and working with local gold shops to stop this scam.  Braley stated, “We've done some outreach to shops that sell gold, and they've been very receptive. And we've actually been able to circumvent some of these scammers victimizing certain people in the area.”

Recently, an 82-year-old woman from Maryland was scammed out of more than $900,000. Fortunately, the scammer was caught before the woman gave up another $2.6 Million. This is the second time in four months that the Maryland police have dealt with the gold bar scam.

Zhenyong Weng, 19, was arrested and accused of being a “courier” in a scam that set up furtive gold bar exchanges in parking lots and used code words like “watermelon” to communicate.

Montgomery District Judge Aileen Oliver said. “It’s stealing from a senior citizen at a time in their life when they need financial support.”

How the Gold Bar Scam Works

1. Initial Contact: Scammers typically make initial contact through phone calls, emails, or face-to-face interactions. They may pose as government officials, financial advisors, or representatives from your bank or legitimate-sounding companies.

2. Convincing Pitch: The scammer presents a compelling story about your banking account being compromised, fees on your account, or back taxes owed. They might use high-pressure tactics, limited-time offers, or fabricated stories of other successful investments.

3. Fake Documentation: To build credibility, scammers often provide fake documents, professional-looking websites, and business cards.

4. Payment and Delivery: Typically, victims are asked to withdraw money from their bank account, convert it into gold bars and either deliver it or hand it off to a courier.

5. Disappearance: Once the payment is made, the scammer becomes difficult or impossible to contact.

How to Spot the Gold Bar Scam

Being able to identify the red flags of a gold bar scam is crucial. Here are some tips to help you spot this fraudulent activity:

  • Unsolicited Contact: Government agencies (IRS, FBI, etc…) will not call you to demand payment, threaten arrest, or ask for personal information. Your bank will not call you and direct you to withdraw all of your money. You need to verify.

  • Lack of Credentials: Scammers often lack proper credentials or verifiable references. Always ask for and verify the credentials. This includes calling the bank or organization directly. Legitimate businesses provide clear information and are registered with regulatory bodies.

  • High-Pressure Tactics: Scammers use a lot of tactics to make confuse you. This includes faking urgency - “your bank account has been compromised and you have 72 hours to withdraw all funds.”

How to Prevent the Gold Bar Scam

Preventing yourself from falling prey to the gold bar scam involves being vigilant and taking certain precautions. Here are some steps to safeguard your assets:

  • Educate Yourself: Knowledge is power. Stay aware of current scams and common tactics used in all scams like pressuring tactics, unsolicited calls, and promises that are too good to be true.

  • Verify Authenticity: Always verify the authenticity the caller. Remember, government agencies won’t call you out of the blue. Take the time to find the phone number of the legitimate company online and verify with them.

  • Consult Experts: Contact your family, friends or accountant before making any decision that requires you to move, transfer or send your money. If in doubt, you can always email us and we can verify the claim for free.

How to Report the Gold Bar Scam

If you suspect that you or someone you know has been targeted by the gold bar scam, it's important to take immediate action. Reporting the scam can help authorities catch the fraudsters and prevent others from becoming victims.

Reporting Steps:

  • Contact Local Authorities: Report the scam to your local police department. Provide them with all the details and any evidence you have.

  • Federal Trade Commission (FTC): File a complaint with the FTC online at FTC Complaint Assistant or call 1-877-FTC-HELP.

  • Better Business Bureau (BBB): Report the scam to the BBB, especially if the scammer claims to be a legitimate business. Visit BBB Scam Tracker to file a report.

  • State Attorney General: Contact your state attorney general's office to report the scam. They can provide assistance and may already have information about similar scams.

  • FBI: You can report the scam to your local FBI office.