MADISON, Wis. – Attorney General Josh Kaul, in partnership with the Wisconsin Department of Financial Institutions (DFI), today joined a multijurisdictional, coordinated enforcement action to stop a fraudulent precious metals scheme that resulted in investments exceeding $68 million from at least 450 investors nationwide.
The state has joined the Commodity Futures Trading Commission (CFTC) and 26 other state securities regulators in filing a complaint in the United States District Court for the Central District of California alleging Safeguard Metals, LLC and Jeffrey Santulan, a/k/a Jeffrey Hill solicited investors nationwide by touting precious metals at grossly inflated prices that were not disclosed.
“This alleged precious metals scam resulted in substantial financial losses for the victims,” said Attorney General Josh Kaul. “Scammers who target Wisconsinites’ retirement savings must be held accountable.”
“In expectation of additional precious metals investment schemes, investors are advised to check the registration of all investment products and professionals, diligently research investments, ask tough questions about the fees, markups or spreads, risks, and potential returns,” said DFI Secretary-designee Cheryll Olson-Collins. “If the answers seem too good to be true or don’t make sense, protect your wallet by just walking away.”
The defendants are accused of failing to disclose the markup charge for their precious metals bullion products and that investors could lose the majority of their funds once a transaction was completed. In many cases, the market value of the precious metals sold to investors was substantially lower than the value of the securities and other retirement savings investors had liquidated to fund their purchase. In Wisconsin, 17 investors were defrauded out of $1,880,599 in the execution of this national scheme. Many Wisconsin investors liquidated their existing retirement accounts, which contained securities, to obtain funds to purchase the metals.
Investors are encouraged to contact the DFI if they suspect they have been targeted by similar precious metals investment schemes. Please contact the DFI’s Division of Securities Enforcement Bureau at 608-572-2122.