Today's reminder of the importance of taking physical delivery of gold at the best price possible comes from Singapore.
The Gold Guarantee is (was?) a company based in Singapore allowing "investments" in gold. They had two separate schemes. One allowed victims to take delivery of their gold, but at an approximately 30% premium, albeit with a monthly repayment of a small portion of the premium for as long as the gold was held (and the company remained solvent) and an option for the company to buy back the gold at a price related to the spot price. The other scheme offered a gold certificate and a higher monthly payout.
The monthly payouts amounted to over 20% p.a. I am unaware of any method by which a company could sustain such payouts through normal business practices. Were I aware of such a business, I would invest in it.
Today's Straits Times reports (unfortunately this story is not in the free online section) that the owner of the company is unreachable, and the offices have been shuttered since about January 9. The last communication most shareholders had was an email sent on January 8, announcing a merger between The Gold Guarantee and a similar company called Asia Pacific Bullion.
Customers have been dropping by the office and showing up at the CEO's home since he vanished, but to no avail. Some are facing losses of hundreds of thousands of dollars.
The latest gold price reported on the company's website is dated January 7. What appears to be an apologist blog posting for the company is dated January 3.
Here is a link to a discussion group which includes some unfortunates who bought gold from this company within the last few months. Note the advice they have received.
The scheme looks like a carbon-copy of the Genneva scam which fell apart in October.
Avoid certificates, and if you take delivery of gold, verify the spot price (it should be part of your due diligence).
Update:
Here is an article on the topic by a local financial blogger.
Update February 3
Channel news Asia reports that authorities have sized The Gold Guarantee's assets.
New scandals in gold investments occur in Singapore all the time.
The Gold Guarantee is (was?) a company based in Singapore allowing "investments" in gold. They had two separate schemes. One allowed victims to take delivery of their gold, but at an approximately 30% premium, albeit with a monthly repayment of a small portion of the premium for as long as the gold was held (and the company remained solvent) and an option for the company to buy back the gold at a price related to the spot price. The other scheme offered a gold certificate and a higher monthly payout.
The monthly payouts amounted to over 20% p.a. I am unaware of any method by which a company could sustain such payouts through normal business practices. Were I aware of such a business, I would invest in it.
Today's Straits Times reports (unfortunately this story is not in the free online section) that the owner of the company is unreachable, and the offices have been shuttered since about January 9. The last communication most shareholders had was an email sent on January 8, announcing a merger between The Gold Guarantee and a similar company called Asia Pacific Bullion.
Customers have been dropping by the office and showing up at the CEO's home since he vanished, but to no avail. Some are facing losses of hundreds of thousands of dollars.
The latest gold price reported on the company's website is dated January 7. What appears to be an apologist blog posting for the company is dated January 3.
Here is a link to a discussion group which includes some unfortunates who bought gold from this company within the last few months. Note the advice they have received.
The scheme looks like a carbon-copy of the Genneva scam which fell apart in October.
Avoid certificates, and if you take delivery of gold, verify the spot price (it should be part of your due diligence).
Update:
Here is an article on the topic by a local financial blogger.
Update February 3
Channel news Asia reports that authorities have sized The Gold Guarantee's assets.
New scandals in gold investments occur in Singapore all the time.
A blog-post of mine in December ("How to buy gold") ended with the words "There is more risk in custody than in price, in these wicked days." Ain't it the truth?!
ReplyDeleteIt is really important to study how and where to buy gold or to buy silver so you deal with trusted and honest sources in trustworthy and reliable purchases. You also have to be aware of companies that don’t keep high ethical standards. Hopefully this guide will help you to avoid all kinds of troubles associated with precious metals dealings.
ReplyDeleteUS Gold Bureau
@MIchael indeed it is important to study when and where to buy gold if you are planning to invest in gold. Now a days gold investment had been really popular all over the world but this kind of investment doesn't guarantee you a good outcome so you must be cautious.
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