JACKSON – Secretary Michael Watson and Attorney General Lynn Fitch announced today that Mississippi is participating in a consolidated enforcement action to stop a fraudulent precious metals scheme that resulted in solicitations exceeding $68 million from at least 450 investors nationwide.

Mississippi joined the Commodity Futures Trading Commission (CFTC) and 26 other states 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.

"Mississippians should be able to invest their hard-earned money without the worry of fraudsters capitalizing on their uncertainty,” said Secretary Watson. “I am incredibly proud of our Securities team for being an integral part of this enforcement action. We will continue to do our part to stop fraudulent schemes such as this one and to ensure the people we serve receive the honest financial advice and services to which they are entitled, especially when it comes to retirement money they have worked so hard to save.”

The investors in this case were advised to liquidate their holdings at registered investment firms to fund investments in precious metals, bullion, and bullion coins through self-directed individual retirement accounts. Self-directed IRAs should not be confused with traditional IRAs or other retirement vehicles. 

“Defendants targeted seniors and those close to retirement age,” said Attorney General Lynn Fitch. “They preyed on their fears and jeopardized their fixed incomes. Seniors have worked a lifetime with the hope of living comfortably in their retirement, and Mississippi will not stand for scamming them in order to turn a quick profit.”

The defendants are accused of failing to disclose the markup charge for their precious metals bullion products and failing to disclose 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 Mississippi, six investors were defrauded out of nearly $892,000 in the execution of this national scheme. Many Mississippi investors liquidated their existing retirement accounts, which contained securities, to obtain funds to purchase the metals.

Secretary Watson and Attorney General Fitch encourage investors to contact The Secretary of State’s Securities Division or the Attorney General’s  Consumer Protection Division if they suspect they have been targeted by similar precious metals investment schemes.