Despite its best efforts, the Commodity Futures Trading Commission (CFTC) is losing its game of Whack-A-Mole against precious metals fraudsters targeting seniors. As one fraudulent dealer is shut down, more “moles” appear in its wake. Understaffed and underfunded, the agency simply does not have enough mallets to stop the spread of precious metals fraud.

For instance, the CFTC shut down Safeguard Metals after bringing a lawsuit alleging that the company was selling precious metals coins as an investment to seniors at inflated prices of 50% or more over spot—but not disclosing the markups. Part of the scam involved representing that the coins purchased were unique or rare and held intrinsic value when, in reality, they were readily available on particular markets and held little or no “rarity” value. The CFTC said the company received approximately $68 million in investor funds, with a majority coming from “retirement savings solicited from approximately 450 people to purchase precious metals, primarily silver coins.”