Gold IRA Scams: Red Flags to Look Out for and How to Avoid Becoming a Victim
A gold IRA can be highly beneficial for investors looking for a smart way to diversify their retirement portfolios.
Rolling over or transferring partial savings from a 401(k) or traditional IRA account into physical gold stored and managed through a gold IRA company helps protect assets against inflation and fluctuation- as well as providing tax benefits. Unlike a standard IRA, gold IRAs allow investors to buy and hold physical gold in provider-appointed and approved facilities.
Because these gold IRAs are becoming more popular, with more people choosing to invest in gold bullion, gold bars, gold coins, and other precious metals assets, the number of gold IRA companies and service providers has skyrocketed.
Unfortunately, with that increase comes an unwelcome spike in scams hoping to take advantage of investors who don’t have all the information. Knowing who these scammers target, what they offer, and how to spot them can help investors avoid becoming victims.
The following guide shares all the essential red flags to look out for and gives tips on how to safely and securely buy physical gold through a gold IRA company.
The top way to safeguard your retirement is to open a precious metals IRA. Check out the below providers and request a free kit.
Company | Personal Findings | Review | Free Guide | |
 | #1 Goldco | Best Overall Rating (Where I Invested) | ||
 | #2 American Hartford Gold | Best Buyback Program | ||
 | #3 Augusta Precious Metals | Most Educational ($50,000 Minimum) | ||
 | #4 Noble Gold | Best Metals Selection |
What Will I Learn?
Common Precious Metals IRA Scams
First things first- what do these scams look like? There are many ways people can try to take advantage of or mislead people inquiring about a precious metals or gold IRA, but these are the most common types of investment scams in the
Fake Coins
One of the most common issues is scammer companies selling and delivering fake coins and bullion coins for the full price of the real thing. These companies may claim to deal in rare, collectible, or investible gold and silver coins to be stored in a gold IRA but are actually selling counterfeits.
When the assets are delivered, it may or may not become immediately obvious whether or not they are real, but an expert can quickly tell the difference.
Genuine precious metals dealers should always have some sort of documentation or proof of authenticity for any gold bullion, coins, or bars. The same goes for silver and any other precious metals products they sell. Never accept a company that cannot provide verification of the asset’s purity and authenticity.
If you buy gold or other precious metals without asking for a document of authenticity, you could be left in a difficult position with no power to get the money back.
Bear in mind- some unsavory dealers selling fake coins may also attempt to fabricate the documentation. Anyone who is not 100% convinced or doesn’t know how to tell should seek guidance from an impartial professional. The team at Cayman Financial can assist in this matter.
Failure to Deliver Physical Gold in Full
When a person purchases gold or other precious metals, it has to be delivered and stored in an approved facility- or in some cases, at the person’s home. Some scams send the assets- but not in full in the hope it goes unnoticed. Always follow up and ensure all precious metals purchased through the gold IRA are present and correct.
Additionally, make sure the gold is sent to an IRS-approved depository- not a random holding facility.
Companies that Do Not Exist
A common scam is for people to claim they provide gold IRA services or sell precious metals but have no real good to provide. In these cases, they convince the victim to hand over their bank or card details or send payment in some other way, then disappear with the funds.
Overcharging for Assets and Services
Gold IRA rollovers are complicated, and a confident scammer could easily confuse an investor who doesn’t have a solid knowledge of the process. They may overcharge or add extra services that are not required- all to get a little more money out of people than they should.
Things to Look Out For
High-Pressure Sales Pitches
Some salespeople work on commission, which doesn’t necessarily make the gold IRA service a scam, but it is worth paying attention to. They have an additional incentive to oversell or push people towards investments that are not right for them- all to earn themselves more money. Of course, not every sales agent is like that- but it is worth thinking about.
There are also cases where pushy sellers can be a sign of sinister intentions- especially if they refuse to take no for an answer and insist on trying to push an investment higher. If the pushy sales techniques result from unsolicited phone calls, it should be even more of a red flag.
Unrealistic Rates and Promises
If something seems too good to be true, it probably is. When it comes to the price of gold and rates surrounding gold IRA accounts, there is very little difference from company to company. When one provider offers exceptionally low costs that don’t even come close to the industry standard- be very wary!
Additionally, if a representative or website promises guaranteed success or claims to be 100% foolproof- proceed at your own risk. These are most likely Ponzi schemes or straight-up lies- both things best avoided.
Lack of Online Presence
The biggest names in gold IRA services- such as Augusta Precious Metals and Goldco– generally have well-built websites and plenty of reviews and ratings from all the go-to trust sites. If you can’t find much out about a company online- it usually isn’t a great sign.
Even if they claim it is because they are a new business, just starting, undergoing site maintenance, or changed their name- these are all further red flags relating to their online image and influence.
Irrelevant Advice Given
Most people can probably think of a time they had a conversation with a company or salesperson that felt like a lot of talking around the subject and never really answering any questions.
This tactic of diverting the conversation to confuse or mislead the potential investor can be used to get them to overpay, miss red flags, and feel generally unsure about what they have agreed to so they are less likely to follow up if something is amiss.
If you are not getting straight answers or feel like the conversation is trying to drown you- step away and learn more about the company before you proceed- or try somewhere else entirely.
Additionally, in some cases, the agent may promote other ‘approved’ precious metals instead of the one the person is interested in even after they have explained what they want. This could be a sign that they don’t have what they advertised and can’t sell it- which throws everything about the business into question.
How to Avoid Gold IRA Scams
Here are a few simple steps to take to avoid falling victim to a scam gold IRA company or precious metals dealer.
Stop and Think
It seems simple but never rush into any decision. Sometimes, people are so excited about the possibilities of a gold IRA account that they dive in without due diligence. In most cases, a scam is pretty recognizable if people just look for the signs- but many scammers bank on them being distracted and failing to take the time to notice.
Stop, take a beat, and really look at what a company is offering. If you notice something that doesn’t seem quite right, don’t ignore it!
Research Reputable Gold IRA Companies
Like any purchase, the more prior research that goes into the search- the more likely a buyer is to make the right choice. There is no shortage of excellent and reputable gold IRA companies out there- many of which offer comprehensive services and assistance through every step.
Read reviews, comparisons, and testimonials for real users through trusted sites and ratings websites, and call the customer service line to ask more questions before going ahead. Most of the big names in gold IRAs have excellent customer care and provide everything a person needs to open and stock a gold individual retirement account safely and securely.
Question the Payment Methods
Genuine gold IRA companies, precious metals dealer sites, and any worthwhile trading platform should support safe, secure payment options and have publicly available information regarding their privacy and payment protection policies.
If something feels off about the method of payment someone is requesting, don’t go ahead without being sure of its legitimacy. Unsecured payment methods are not only more likely to be linked to a scam, but they can also leave personal financial details exposed to hackers.
Don’t hesitate to question the requested payment type. Sometimes this can be enough to warn off the would-be scammer, and it could help avoid a costly mistake.
Ask for Advice from a Financial Advisor
A financial advisor is there to guide and assist people to make the most intelligent, beneficial, and relevant decisions for them and their portfolios. Part of that is helping them avoid bad investments and outright scams. If there is even a hint of doubt, everyone should call for professional financial advice from the people whose job it is to know.
Final Thoughts on Gold IRAs and Scams
Choosing to diversify an individual retirement account, mutual funds, self-directed IRA, or other long-term savings fund is wise for many investors- but they need to be careful not to get caught by scams focused on the gold IRA market and precious metals industry.
Rushing into things and ignoring warning signs can cause people to lose money they have saved throughout their lives- leaving them in a difficult position for their upcoming retirement.
Email us if you need any help navigating the maze of retirement accounts, rollovers, and gold IRAs.
Speak to an expert today for more information on finding legitimate, reliable, and approved precious metals companies that can genuinely assist potential gold investors to purchase alternative assets and shake up their retirement portfolio.
About Arthur Karter
Hi, I’m Arthur, and nobody wants to wake up in their 50s like me that they are in serious debt with minimal assets. This wake-up call forced me to reevaluate everything. After going through the school of Hard Knocks, I’m ready to help you by sharing the best retirement choices and how they differ from all the same-old, same-old options that financial advisors sell. These alternatives will help you build and protect your wealth.
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