Gold Prices Are High: Proceed With Caution
You can't turn on the radio or television without acknowledging that the price of gold is at an all-time high. Uncertainty with the direction of the U.S. Economy has made many people start to mine for "lost gold" in their drawers and closets: You know, those old, broken pieces of jewelry and the long-lost fillings.
But, experts warn consumers to be cautious.
The Financial Industry Regulatory Authority issued an investor alert Thursday warning about scams that promote gold stocks.
"Con artists are using the run-up in the price of gold as a hook to part investors from their money. Investors should think twice before investing in any gold investment promising exponential returns, or any company that claims it is a buyout target for other mining companies," Gerri Walsh, FINRA's vice president for investor education, said in a statement.
Their warnings get very specific and detailed.
In particular, investors should be wary of investment pitches that use scare tactics such as the threat of inflation or an economic meltdown, claim to tie stock performance to the general rise in gold prices, or make speculative claims based on new reserves, FINRA said.
Gold investments also made the annual top 10 list of products that threaten unwary investors, which was released this week by the North American Securities Administrators Association.
In the past few months, two big gold-selling scams out of Florida have taken in millions of investor dollars.