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Scammers targeted retired Alaskans based on Christian, conservative views

Published: Oct. 19, 2020 at 7:26 PM AKDT
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ANCHORAGE, Alaska (KTUU) - In what Alaska’s Department of Law calls the most significant fraud on Alaskans in years, seven retirees lost a combined total of $1.5 million to a precious metals investment company allegedly targeting elderly Christian and politically conservative investors.

Palmer resident and lifelong conservative Norman Ditsworth, 78, said he was already interested in investing in silver and gold. When a representative of Metals.com called him up and seemed to know what they were talking about, he decided to invest.

“I didn’t do enough research,” Ditsworth said.

Court records show he invested $221,243.47 on April 29, 2019.

While he said he thought he was getting silver ingots, he was actually sold thousands of supposedly collectors coins.

A court document states he purchased “6,775 one-half ounce silver 2019 Royal Canadian Mint Polar Bear coins at a unit price of $22.69 and 96 quarter-ounce gold 2019 British Standard coins at a unit price of $675.14.”

His loss was immediate, according to the document:

“The market price per ounce of silver on April 29, 2019, was $14.93. The market price per ounce of gold on that same date was $1280.50. N.D. paid Metals.com $45.38 per ounce of silver and $2,700.60 per ounce of gold. The resulting value of the coins that Metals purchased for N.D. was $50,575.38 in silver and $30,732.00 in gold, for a total value of $81,307.38. As a result, N.D. experienced an immediate decline in the value of their retirement savings in the amount of $139,936.10 or 63.25%.”

“These coins have no value other than the metal that they’re made out of, I mean unless you’re going to open a gift shop and you need 10,000 polar bear coins,” said Rob Schmidt, Sr. Assistant Attorney General at the Alaska DOL.

While Ditsworth was already looking to invest, investigators say when other victims needed more convincing, callers representing Metals.com reportedly capitalized on the country’s polarized political environment to stoke fears that the federal government would seize their retirement savings, convincing them that they should move their money and invest in precious metals.

Some callers even falsely claimed to be affiliated with well-known conservative public figures.

“Some people said that they were specifically working with team Trump,” said Arina Filippenko, a financial examiner who works in the DOL’s Division of Banking and Securities. “In other states, some salespeople said that they were personal friends of Sean Hannity and that they wanted to help these people preserve all of their retirement assets. We had one individual in particular who was told by one of the metal salespeople that because of Nancy Pelosi being in the House, all of their securities and retirement assets were going to be seized by the government and the only way to protect their assets was to invest in precious metals.”

There is nationwide enforcement action against TMTE Inc., also known as Metals.com, Chase Metals Inc., Chase Metals LLC, Barrick Capital Inc., Simon Batashvili, Lucas Asher and Tower Equity LLC, according to a release from the Alaska DOL.

Additionally, a lawsuit that includes Alaska and 29 other states as well as the U.S. Commodity Futures Trading Commission is pending in Texas. It represents the largest ever joint federal, state, commodities case in the history of the CFTC, according to Schmidt.

“The complaint alleges that the defendants violated the federal Commodities Exchange Act, CFTC regulations, and various state laws, including Alaska’s Unfair Trade Practices Act,” according to the DOL release.

The federal government and several states are asking the courts to order the defendants to stop sales activity, return investors' money, pay civil fines and stop breaking the law.

According to Schmidt, the alleged nationwide scheme is believed to involve more than 1,600 victims across 30 states and more than $185 million in fraud.

Alaskans who believe they have been a victim of fraud in this case or any other are encouraged to reach out to Alaska’s Division of Banking and Securities by email at securities@alaska.gov or call (907) 269-8140.

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