Police in Westborough, MA are requesting the public’s assistance in catching two alleged suspects believed to be connected to a scam that resulted in the victims losing $306,000. The police posted the details of the case on Facebook, along with closed-circuit camera footage of the two con artists, in the hope that someone would recognize one or both of the men.
The scam occurred when the two suspects held a clandestine meeting with three other men at the Extended Stay America hotel on Computer Drive. The three men were meeting with the suspects as they were interested in buying gold dust from them. Prior to any agreement or financial transaction, the victims of the scam claimed to have conducted tests to verify the authenticity of the gold.
The gold dust was confirmed to be 93 percent pure and 22 karat. The buyers agreed to purchase 10 kilograms of the precious metal for a cost of $306,000. The sellers, in turn, were supposed to add another 5 kilograms of gold dust with payment due after the product was refined and re-sold.
With the parameters of the deal in place, the buyers paid the suspects $26,000 in cash, and the remaining $280,000 was deposited into a Bank of America account.
In exchange for the payment, the three buyers received a locked safe where 15kg of the gold dust was supposed to be housed inside. According to the buyers, they were informed that they would be given the combination to open the safe once the money transfer to their account was confirmed.
After two days, the men were sent via email a combination to open the safe. However, as it failed to open it, a locksmith was called in. It was revealed that the supposed gold dust inside the safe was in fact fake gold and completely void of value.
While this still unsolved scam may seem to suggest that investing in gold is risky, such acts of fraud are far and few between. Yet, in and of itself gold can be a risky investment, just like any other investment. Besides for gold dust, owning and investing in gold is possible in various forms from coins and bullion to ETFs and mutual funds.
While inherent risks do exist, according to the Canadian Bullion Services which advisers investors interested to buy gold in Canada, when gold is used as a small and healthy part of an investment portfolio then it can serve as an effective way to balance other assets that may not be performing well. As broad diversification is the key to healthy and successful long term investments, a good mixture of gold, along with other precious metals like silver and platinum, in a portfolio that already contains other types of investment can help reduce risk and maintain a well-balanced portfolio.