Written by Tim Goff
SOUTH PORTLAND, Maine (NEWS CENTER) - With gold prices at an all time high, state regulators are warning investors to beware of scam artists.
"With a really bad economic downturn, with the recession, not only does it cause the average person to become fearful, but it also causes the scam artists to come out because they know that everybody is far more vulnerable than they were before," stated Judith Shaw, administrator of the Maine Office of Securities."Anytime somebody is telling you that they can give you a high rate of return with little or no to you, you really need to think twice about that," she added.
In recent weeks her office has received several calls from residents concerned about transactions they have made buying and selling gold. She says many of the advertisements on the internet, radio and television make claims that are not backed-up by the companies actions.
"They send their money, there is a promise that the gold exists - maybe gold bullion - and that the seller who has reached out and made the contact will save that gold or silver in some safe location," explained Shaw. "The danger is in many cases the gold doesn't exist."
She recommends people do their business locally, because the state has regulations in place to protect consumers that may not be in place in other states where these companies are located.
"As with anything, check to see if the entity is regulated by the state of Maine and check with the appropriate agency to make sure that there are no problems, issues or bad marks as to that entity," she said. "We all have to be wise consumers, whether we are purchasing gold or some other commodity, or whether we are choosing to sell a personal possession."
At Maine Gold and Silver in South Portland, record gold prices have their showroom flooded with customers looking to sell off unwanted items, or in bars and coins of gold and other precious metals.
"We have a track record," explained John Colby. "Customers depend on us and we pay high prices. We have people driving 2 or 3 hours to see us."
He says gold prices fluctuate, so they use technology to give customers up to the second prices whether buying or selling.
"There is volatility," said Colby. "Right now gold has gone down about 20 bucks from its high on the day, but in the long term I think gold and silver are going much, much higher."
Shaw recommends consumers interested in selling gold or other precious metals check the price at a couple of businesses to get a better idea of the value of the item they intend to sell and find the best price.
She says people should also ask about how the metal will be weighed, the price will be determined and the quality verified.
She does not recommend people send their unwanted jewelery away in an envelope in the hopes that someone, somewhere else will give them a better price. She says it is easier to keep your money than fight to get it back.
She also says if someone is using high pressure tactics, walk away and take your business elsewhere.
If you are interested in buying gold and silver, she suggest consumers call the Maine Office of Securities at 207-624-8581 or visit their website before . The state maintains a database of reputable companies and can help determine if a seller is on the level.
Shaw says if you do buy gold from an out of state company, you should have the metal shipped to you and store it in a secure location like a bank's safety box or vault.
She also says be aware of any fees imposed for shipping and the transaction before completing the deal.
"If it sounds too good to be true, it probably is," said Shaw. "It may sound like an old cliche, but it is absolutely right on."