Articles Posted in Commodities and Precious Metals Fraud

For ages, gold has been a safe investment for the uninitiated or market-wary. The stability of gold and other precious metals make them an accessible investment with little influence from volatile markets.

The accessibility of precious metals, however, makes them an easy vessel for would-be scammers and fraudulent brokers to take advantage of unseasoned investors. In many cases, alertness and skepticism can mean the difference between making a solid investment and making a stolen investment.

If a prospective broker attempts to entice you into buying gold, silver, platinum or palladium with any of the following tactics, consider your next moves carefully.

On September 19 2019, William C. Conway, Jr., originally of Fort Lauderdale, Florida, and Steven Schrag, originally of Bartlesville, Oklahoma, had a final judgment entered against them, jointly and severally, in the total amount of $771,350 for fraud and deceit in the case styled Michael Conville, Joseph Gilmore and Beacon Construction Group, Inc. v. William C. Conway, Jr. , Steve Schrag et al, Case No. 12-33381, filed in the Circuit Court of Broward County, Florida.

The final judgment was based upon a unanimous jury verdict which found Willian C. Conway, Jr. and Steven Schrag, among other defendants, guilty of fraud in the inducement, negligent misrepresentation in the inducement and conspiracy to defraud.  The judgment was predicated upon an alleged gold (precious metals scam) which originated in Africa.

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Fort Lauderdale, Hollywood, Davie, Pompano Beach, Deerfield Beach, Lighthouse Point and Boca Raton, Florida Oil and Gas Fraud and Sale of Unregistered Securities Litigation and Arbitration Attorney:

Securities and Exchange Commission v. Jason A Halek, Joshua D. Spivey, Patrick J. Booths and Steven J. Little, Civil Action No. 3:14-cv-01106-D (NDTX) (March 28, 2014)

SEC Charges Four Texas Residents for Selling Fradulent Oil and Gas Investments

Florida Precious Metals (Gold, Silver, Platinum, Palladium and Copper) Fraud and Misrepresentation Federal and State Litigation and Arbitration Attorney:

On December 14, 2011, the Commodity Futures Trading Commission (“Commission”) issued in the Federal Register an interpretation regarding the meaning of the term “actual delivery,” as set forth in the Commodity Exchange Act.  Recently, the Commission determined to clarify its interpretation, which is reflected in the attached link.

This interpretation is important from the prospective of both sellers and buyers of precious metals using leverage.  From a sellers standpoint, failure to comply with the actual delivery provisions, discussed in the interpretation could led to adverse consequences from an enforcement action brought by the Commission or in a civil action brought by a purchaser.  CFTC Interpretive Release – Actual Delivery

South Florida Precious Metals Fraud, Misrepresentation and Breach of Fiduciary Duty Litigation and Arbitration Attorney:

The Manhattan District Attorney’s Office recently announced that three Florida men who operated an investment scheme through a precious metals company have been indicted in New York City on charges they defrauded scores of investors out of millions of dollars.

Manhattan District Attorney Cyrus Vance said Tuesday Sean Robert Stropp, Karl Spicer, Ricardo Garcia and PMCO Services Inc. were charged with grand larceny and violation of the Martin Act among other charges.

Securities and Exchange Commission Sues Texas Oil and Gas Promoters for Securities Fraud

On June 28, 2013, the Commission charged Matthew Madison and Dwight McGhee, and their Irving, Texas based company Infinity Exploration, LLC, with conducting a fraudulent offering of oil and gas related investments. The Commission’s complaint alleges that, between March and October 2008, Madison and McGhee raised over $2 million from at least 40 investors from the fraudulent offer and sale of interests in Infinity’s two oil and gas joint ventures. Infinity’s offering materials misled investors into believing that Infinity’s ventures would own the leases and control drilling operations. Indeed, Infinity’s communications with investors were peppered with references to as “our wells” and “our crew.” In reality, Infinity’s ventures did not have direct interests in any oil and gas leases and no direct involvement in operation of any leases. The complaint alleges that Madison and McGhee concealed this fact from investors. The complaint further alleges that the defendants’ offering materials falsely described Madison as experienced and successful in the oil and gas industry and failed to disclose McGhee’s 2007 federal felony conviction.

The complaint alleges that Infinity, Madison, McGhee violated Section 17(a) of the Securities Act of 1933 and Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint seeks permanent injunctions, disgorgement of ill-gotten gains plus prejudgment interest and civil penalties against each of the defendants. [SEC v. Infinity Exploration, et al., Civ. Action No. 3:13-cv-2499-L, USDC, NDTX (Dallas Division, June 28, 2013)].

Numismatic Coin – Florida Precious Metals and Numismatic Coin Fraud and Misrepresentation State and Federal Court Litigation Attorney:

A Numismatic Coin is a coin that is valued based on its rarity, age, the quantity originally produced, and condition.  These coins are bought and sold as individual items within the coin collecting community.  Most Numismatic Coins are legal tender coins that were produced in limited quantities to give them scarcity value.  They are historic coins which also can be rare.  The current price of gold is a minor factor when dealing with Numismatic Coins.  Premiums are traditionally far higher than those of Bullion Coins, and values fluctuate to a much wider extent.  For example a $5 gold piece may may contain $70 dollars of gold but may sell for as much as $700.  The minimum amount recovered from Numismatic Coin investments is always either its face value or its metal content.

With the above in mind, anyone considering investing in Numismatic Coins should think twice, especially if the investor is dealing with a firm located in another city or state.  In our opinion, Numismatic Coins should never be purchased with anything other than absolute risk funds.

CFTC Orders Florida Firms, Joseph Glenn Commodities LLC and JGCF LLC, and Owners Scott Newcom and Anthony Pulieri to Pay over $1 Million in Restitution and Penalties for Fraudulent Off-Exchange Transactions in Precious Metals with Retail Customers

The U.S. Commodity Futures Trading Commission (CFTC) recently issued an Order filing and settling charges against two Boca Raton, Fla., companies, Joseph Glenn Commodities LLC (Joseph Glenn) and JGCF LLC (JGCF), and their sole owners and principals, Scott Newcom and Anthony Pulieri (the Respondents) for engaging in illegal, fraudulent off-exchange financed transactions in precious metals with retail customers.

The CFTC Order, filed on March 27, 2013, requires Joseph Glenn, JGCF, Newcom, and Pulieri to pay approximately $635,000 in restitution to customers for their losses and to return approximately $330,000 remaining in customers’ accounts. The Order requires Pulieri to pay a civil monetary penalty of $100,000. The Order also permanently prohibits the Respondents from registering with the CFTC and imposes a five-year trading ban on trading for others. In addition, the Order prohibits the Respondents from violating the Commodity Exchange Act, as charged, and requires them to comply with certain undertakings, including fully and expeditiously cooperating with the CFTC.

Precious Metals Fraud and Misrepresentation:

CFTC Charges Hunter Wise Commodities, Lloyds Commodities, C.D. Hopkins Financial, United States Capital Trust, Newbridge Alliance, Blackstone Metals Group, and their Principals in Multi-Million Dollar Fraudulent Precious Metals Scheme

CFTC alleges that defendants conducted illegal, off-exchange commodity transactions, and deceived customers in connection with financed transactions in precious metals

Investors Thinking About Trading Foreign Currency Contracts Consider the Following:

The advertisements seem too good to pass up. They tout high returns coupled with low risks from investments in foreign currency (forex) contracts. Sometimes they even offer lucrative employment opportunities in forex trading.

Do these deals sound too good to be true? Unfortunately, they are, and investors need to be on guard against these scams. They may look like a new sophisticated form of investment opportunity, but in reality they are the same old trap-financial fraud in fancy garb.

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