The price of gold has increased over the last week, which could give swindlers more opportunities to trick their victims.
The gold bar scam sounds like a con no one could possibly fall for, but it does happen. The scheme involves victims, usually senior citizens, sinking their life savings into gold, silver or some other precious metal to safeguard their assets, after being convinced to do so by a con artist.
If a scammer gains your trust, it can seem like a good idea to follow their advice and invest in gold, a precious metal that’s typically a sound investment in times of economic uncertainty. But once a victim entrusts the gold bars to the scammer for safekeeping — surprise — the scammer is never heard from again.
Gold bar ploys are on the rise. The FBI first warned about an increase in these scams in January 2024, but their popularity has grown.
The FBI issued another warning last summer, specifically warning residents in Sarasota County, Florida, amid complaints that gold bar scams had duped seniors out of more than $300,000. Random cases kept popping up through the end of 2024. This year, gold bar scams have duped victims in Portland, Oregon, and New York.
What’s the gold bar scam?
Gold bar scams generally work like this: A bad actor will concoct an elaborate backstory and impersonate a government official, maybe from the FBI or the Treasury, to convince someone that their money isn’t safe in the bank.
The criminal will urge the victim to remove their money from their savings account and invest it in gold. If they listen, they’ll either find a local gold merchant or order it online. Then the victim will meet the scammer posing as a courier who will take the gold, promising to deliver it to a safer location. They may even give a receipt to the victim. However, the courier will abscond with the gold instead.
Why are criminals turning to gold bar scams?
Scammers have focused on gold lately for several reasons: Gold is a valuable commodity and hard to trace. People are also easier to get through than a bank security system.
Tech companies and banks have made it difficult for consumer accounts to obtain viruses or get hacked, according to Robert Siciliano, a security analyst and author of Identity Theft Privacy: Security Protection and Fraud Prevention.
“Information security is the best it’s ever been,” Siciliano said, “and the most effective way to get around all this security is, of course, to hack humans.”
Gold has a reputation for being valuable
Similar to how other investment vehicles can fluctuate in price, so too can gold. While its doing well right now, that may not always be the case. Still, criminals know there’s money to be made off gold.
“With gold [selling] as high as $3,000 an ounce, it has never been more attractive to scammers to ramp up and engage in the shotgun approach and target mass populations with this particular ruse,” Siciliano said.
He added that 98% of people aren’t going to get sucked into talking to a con artist about transferring their money into gold but if 2% of the people who are targeted do speak to a scammer, that’s all that’s needed for this to be a profitable scam.
People trust gold
People don’t always trust the economy, but they tend to trust gold.
“As the value of assets such as precious metals, like gold, experiences a rapid increase in value and attracts widespread attention, scammers will jump on the trend and use it to their advantage,” said Darius Kingsley, managing director and head of consumer banking practices at JPMorgan Chase. “Gold is often sought as a hedge against economic instability or inflation.”
Gold is essentially impossible to trace
Gold bars have serial numbers but it’s impossible to tell where the metal originated from once melted down. Whereas if you’re a criminal trying to sell stolen artwork or a car, if the police catch up with you, it’s relatively easy for law enforcement to determine that something fishy is going on.
Gold has a power over our imagination
In school, you learned about the gold rush of 1849. If you’re a James Bond fan, you may be familiar with the movie Goldfinger and how the villain planned on stealing the gold from Fort Knox. TV ads are often pushing gold as a sound, safe investment.
If a criminal has convinced you that your bank account is unsecure, it makes sense that they’d suggest gold rather than convince someone to invest their life savings in rhodium. Gold is familiar and sounds like a logical investment.
How to avoid gold bar scams
It’s important to remember that if someone is offering unsolicited advice about taking your money out of your bank and putting it elsewhere, you should be on your guard. It’s very unlikely that a government official would give you any such advice. Pay attention to your intuition. If you feel something might be off, it probably is.
If your trusted bank associate raises concerns about the legitimacy of your withdrawal, listen to them. They’re trained to keep an eye out for suspicious transactions. While they can’t stop you from withdrawing your money, they can tell you whether the reasons behind the withdrawal sound odd.
If you take out your money, banks and credit unions wouldn’t be able to refund the money, according to Jennifer Hallenbeck, collection and fraud manager at Wasatch Peaks Credit Union.
What to do if you’ve fallen for the gold bar scam
Unfortunately, recovering lost funds with this type of scam is unlikely. However, that doesn’t mean there’s nothing you can do.
Immediately call the police. If you’ve met a courier or had a courier pick up gold from your home, the thief may still be lingering in the area or there could be evidence the police could collect.
Contact your bank. While your bank isn’t required to reimburse you if you took the money out yourself, letting them know about the scam could help them raise awareness. Now, if your bank was robbed, whether by a masked gunman or a cyberhacker, you would get your money back. That’s why banks are FDIC insured and a theft such as that isn’t the customer’s fault. But in the case of a gold bar scam, you’ve been tricked into being the robber.
Hallenbeck said it’s still a good idea to call your bank or credit union if you’ve been scammed. They typically file a report with the FBI on their members’ behalf. The bank can also take extra precautions like freezing your account or putting an alert on it to prevent future scams.
Contact these government agencies. The Federal Trade Commission always wants to hear from people who are unfortunate victims of fraud. The FBI’s Internet Crime Complaint Center is also an excellent resource, and they, with the police, may want to get involved in your case. Your state attorney general’s office would likely appreciate hearing about your situation.
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