Goldline International is a dealer in precious metals known for its aggressive sales techniques and celebrity endorsers, including Glenn Beck from Fox News. This company is currently under investigation by local authorities and Congress regarding possible criminal activities. The business model used by the company was the subject of a recent expose done by ABC News.
The offices of the Santa Monica City Attorney and Los Angeles County District Attorney have launched an investigation into the company concerning possible criminal practices. The House Subcommittee on Commerce, Trade, and Consumer Protection plans to hold a hearing regarding Goldline’s business practices. The company was recently sent a letter by House Commerce Subcommittee member Anthony Weiner and Chairman Bobby Rush requesting information required for hearing preparation
The office of Rep. Anthony Weiner released a report in May detailing issues with Goldline International. These include the company grossly overcharging for gold coins as evidenced by the average markup of 90 percent over melt value, with the largest markup of 208 percent over melt value. On average, the markup by Goldline is 47 percent greater than its competitors and ranges up to 102 percent higher.
The report also states that Goldline makes false claims of offering “good” investments and company sales people offer investment advice without being licensed to do so. The company has aligned itself with conservative spokespeople such as Mr. Beck, Mike Huckabee, Fred Thompson, and Laura Ingraham, who speak of a potential hyperinflation of the U.S. currency system. This feeds public fears during these uncertain economic times and represents unacceptable business practices. Weiner is quoted as saying, “Goldline rips off consumers, uses misleading and possibly illegal sales tactics, and deliberately manipulates public fears of an impending government takeover – this is a trifecta of terrible business practices.”
Rep. Weiner has requested FTC and SEC investigations into Goldline. He is proposing legislation focused on full disclosure of dishonest business practices by companies such as this. The House Subcommittee hearing date has not yet been scheduled but is expected to be later in the summer.
Source: Ritholtz,Barry. The Big Picture. Fools Gold: Inside the Glenn Beck Goldine Scheme.
Tags: gold investment news, Gold News