From a recent Mother Jones (MoJo) article, Glenn Beck's Favorite Gold Company Charged With Fraud (which has several links to previous Mother Jones articles about the right wing obsession with gold):
Goldline International, the California precious metals retailer promoted by Glenn Beck and other right-wing radio hosts, was formally charged with 19 criminal counts—including grand theft by false pretenses, false advertising, and conspiracy—on Tuesday by the Santa Monica City Attorney's Office. The criminal complaint also implicates Goldline CEO Mark Albarian, along with two other company executives and two salespeople.
This was mentioned in last night’s DKos Overnight News Digest, with a link to the Mother Jones article. More below the sideways ampersand (or fleur-de-kos)
If you read the MoJo articles, the main complaint is that people called in to buy bullion and were pressured to buy gold coins, which have a much higher mark-up – which means a higher profit margin for Goldline:
Using aggressive telemarketing tactics, Goldline employees routinely pressured customers to purchase expensive coins with mark-ups so steep that it was very unlikely the consumer would ever make his money back. The company racked up a long list of complaints with the Federal Trade Commission, and at one point was sanctioned by the state of Missouri. But Beck and other endorsers (including liberal talker Ed Schultz) lent an air of legitimacy to the whole operation, sowing fears of a total economic collapse to help make the pitch for Swiss Francs. Beck's pitch went a step further, arguing that in the event of a total financial meltdown, the government would confiscate gold bullion—meaning you should invest your money in coins instead.
Here’s a simple analogy. Paying the retail value for gold coins because the price of gold is going up is like saying, “Hey, the price of pork bellies keeps going up and up, so I’m going to take my retirement fund and buy thousands of packages of bacon from my local grocery store.”
There’s an implication that Ed Schultz (and others like Randi Rhodes and Stephanie Miller) are connected with Goldline, which isn’t true. There’s a different gold-selling company called ITM that advertises on their radio programs. I don’t know if there are any lawsuits involving fraud at ITM. I wouldn’t be surprised. So, the reaction on the right is classic tu quoque – “well, what about that liberal Ed Schultz?”
The MoJo article contains the complaint filed in a California court by the Santa Monica City Attorney, with 19 counts, each of which could carry a maximum penalty of 1 year in prison or a $10,000 fine. So even if they’re guilty on all counts, that’s a maximum fine of $190,000 – peanuts to a company that claims sales of $500,000,000 (half a billion!) per year. But there are probably other investigations or potential lawsuits pending by the FTC or SEC or state attorneys general. And there could be civil lawsuits by disgruntled investors. I’ll bet the Goldine lawyers are working overtime.
The price of gold has been going up, but it seems to me to be a bubble (anybody remember the price of silver going nuts in the early 1980s?). As a thing, gold is useful for electronic parts and for jewelry, but the notion that it will protect you from an apocalyptic collapse of society is crazy. You can eat a chicken and you can burn wood, but you can’t fry up a plate of gold or burn it to keep warm. If we’re living in the world of Mad Max, gasoline will be more valuable than gold. Heck, a 12-pack of Mountain Dew will probably be more valuable than gold. Or my freezer full of bacon.
8:40 AM PT: (Update) Darn. I posted this diary and an hour later a similar article is on the front page. But that's OK.