Is this "Gold Investment" a Scam?

[lootster]

Came across this 2 links so just to warn forum members ....

http://www.XXX.com.sg/index.html

http://www.thegoldlabel.com/index.html

[Dennis Ng]

Came across this 2 links so just to warn forum members ....

http://www.XXX.com.sg/index.html

http://www.thegoldlabel.com/index.html

I would not call it a Scam, just selling gold at inflated prices. It is up to consumers to do their own homework before they buy anything, whether it is gold or anything else.

Hi Nana,

The prevailing price of gold & silver offered by UOB can be found at
https://uniservices1.uobgroup.com/secur ... prices.jsp?&#

There's a phone number at the bottom to call if you want the most up-to-date price. Please compare this price with what the company is offering you.

Cheers

thanks wemakebread for sharing the link.

UOB's selling price is about S$57,743 today, I think those "companies" currently offer the same gold at about S$70,000, or about 20% higher, no wonder they can give people "bonus" on their gold.

[alvin]

Taken from http://www.ifa-sg.com/the-gold-label-ma ... lert-list/

The Monetary Authority of Singapore (MAS) has placed The Gold Label in The Investor Alert List. According to The Investor Alert List website – “From time to time, MAS receives information on unregulated persons who have been mistaken as being licensed or authorised by MAS. Consumers should exercise care when dealing with these persons. Overseas consumers who receive solicitations by persons who claim to have an operation in Singapore should also exercise care and check if they are in fact dealing with persons who are regulated by MAS.”.

Others listed in The Investor Alert List include Sunshine Empire, Profitable Group and Swiss Cash.

According to the MoneySense site, the telltale signs of unregulated person include high-pressured sales tactics and promises of high returns, ‘guaranteed’ profits and quick gains.

[lootster]

Thanks for pointing out Alvin!

Guess more people need to attend Dennis's seminar to see for themselves if something is really a scam?

No. 1 question to ask those "scammer" company, how does your company make money (generate profit)?

[randwick]

Dennis,

Looks like this "business" is still active.

Someone asked whether this is a good deal or not.....invest min $20k in gold bullion now. After 12 months, sell the gold bullion back at 20% profit or 5% per quarter....told the person to come this forum and read the postings here!

Thanks for highlighting during the course.


randwick

[Dennis Ng]

Dennis,

Looks like this "business" is still active.

Someone asked whether this is a good deal or not.....invest min $20k in gold bullion now. After 12 months, sell the gold bullion back at 20% profit or 5% per quarter....told the person to come this forum and read the postings here!

Thanks for highlighting during the course.


randwick

yes, this week, I also received "spam" SMS, offering "Career Opportunity" to market Gold Bullion.

My goodness, I think in a few years' time we are likely to have a Group of people crying and shouting at "Speaker's Corner"...

[lootster]

Another scam afterall.......

TODAY ONLINE Dec 01, 2010
Troubled land investment firm Profitable Plots, which is currently under CAD probe, is left with only $60,000. The High Court released more money yesterday from its frozen bank accounts to pay off staff salaries.

The sum remaining may be all that the 106 people who went to the Commercial Affairs Department (CAD), claiming that their investment returns were either delayed or unpaid, can recover should allegations of fraud stand against the firm.

The 106 investors have collectively invested some $9.5 million. Profitable Plots has some 1,000 clients here.

No criminal charges have been pressed against the company. Three of its directors are believed to be assisting investigations by white-collar police following a raid on its Stanley Street premises in August.

According to court documents, a CAD report dated Oct 12 said Profitable Plots' liabilities and obligations to clients far exceed assets, which gives "grounds to suspect that (the company's investment) schemes are introduced to defraud its clients".

Urging the court to release more money, Mr Wong said these employees were let go in the first week of September and have not received their pay since August.

Deputy Public Prosecutor David Khoo argued, however, that no more money should be released until next Thursday, when the Attorney-General's Chambers has to update the court on the CAD's investigations.

Justice Lee Sieu Kin acceded to Mr Wong's application, noting that investigations have not shown the employees to be complicit in any alleged fraud. These employees were left without a job through no fault of theirs and the court has to consider the financial obligations they may be faced with, the judge said.

Justice Lee also asked how much difference it would make to the purported victims even if he were to reject Mr Wong's application, since the company had only $277,000 when the CAD stepped in.

http://www.todayonline.com/Singapore/ED ... ies--Court

[Dennis Ng]

If people attend my 1-day Seminar How to Save and Accumulate One Million Dollars, they can learn to avoid scams because "How to Avoid Falling into Scams" is one of the topics taught in this seminar.

I understand that there are people who lost as much as S$1 million in Profitable Plots, so if they had attended my seminar earlier, they could have avoided the S$1 million loss.

Financial Knowledge is the TRUE protection against falling into scams.

Details of the 1-day seminar is here:

http://www.masteryourfinance.com/web/in ... &Itemid=35

Video Testimonials of the seminar are here:

http://www.youtube.com/watch?v=cm1sULeqiW4

http://www.youtube.com/watch?v=mYNx6gHl2Dc

[Dennis Ng]

23 Dec 2010 - I hope my warning a few months ago has helped some people to avoid losses and heartache. How did I avoid all these losses? By having Financial Knowledge. Increase your financial knowledge truly can increase your Wealth literally.

It’s not just 1 company, no matter which company you “invest in such gold schemes” in, it is likely to end up in tears, as I’ve warned months ago. You can always count on me to speak the Truth, and nothing but the Truth. I might offend people, but that is not the intention. My intention is pure and want to help people, that’s all.

The article in Today 23 Dec 2010 is here:

http://www.todayonline.com/Singapore/ED ... Alert-List

SINGAPORE - It is a new form of investment that emerged here last year, but the lucrative returns on gold investment schemes - from 4 per cent every three months to 9 per cent after six months - are proving irresistible to many investors.

It is believed to have already attracted thousands of people who have sunk in millions of dollars.

Yet, even as more gold investment companies sprout here, one firm, The Gold Label, has already landed on the Monetary Authority of Singapore's (MAS) Investor Alert List (IAL), prompting some investment experts to caution people against this new product.

The IAL warns consumers about unregulated persons who are not licensed or authorised by the MAS.

The Gold Label, which was incorporated in April last year and is believed to be among the bigger gold investment companies here, was included on the IAL on Nov 28.

The company sells gold at 25 per cent above the market price. Investors hold their gold for six months before selling it back for the entire principal sum invested.

Profits come in the form of 3-per-cent interest on the day of purchase, and at the three-month and six-month marks, making a total of 9 per cent.

According to checks with the Accounting and Corporate Regulatory Authority Singapore, the company's directors filed a notice on Oct 8 this year declaring its inability to continue business by reasons of its liabilities.

Three days later, it filed another notice of the appointment of provisional liquidators for voluntary winding-up.

To The Gold Label's investors and even its own agents, however, nothing seemed out of the ordinary until some clients went to its Battery Road office on Monday to receive their payouts.

Staff of the firm - which has some 1,000 clients according to its former agents - dropped the bombshell that it was facing cashflow problems and would delay their payouts for nine to 12 months.

Some of these investors, who pumped in thousands to hundreds of thousands each, have since gone to the Commercial Affairs Department.

One of them, undergraduate Gladys Siahaan, 22, who invested $22,000, told Media-Corp: "It's quite ridiculous for them not to honour their contracts with investors.

"Their business is going on as usual, people are still buying, but they say they can't afford to pay us back."

The Gold Label's general manager for operations, Ms Joanne Lim, would only say that there is "no doubt that there's a cashflow situation within the company" but the company is "trying its best to help clients".

In response to MediaCorp's queries, an MAS spokesperson said consumers are "strongly encouraged" to deal only with persons regulated by MAS.

"MAS aims to safeguard the interests of consumers by ensuring that only competent and professional persons are allowed to provide financial services," the spokesperson said.

"The laws administered by MAS also require disclosure of information on investment products being recommended to consumers.

"If consumers choose to deal with persons that are not regulated by MAS, they forego the protection afforded under laws administered by MAS."

Sometimes, all that glitters ...
by Teo Xuanwei
Schemes offered by two other gold investment companies - looked into by MediaCorp - vary slightly, but they also promise lucrative returns over very short periods.

XXX sells gold bullion and coins 2-per-cent lower than the prevailing market value. After 30 days, an investor can sell back the gold at the market price on the day of his purchase, or choose to hold on to the gold, according to information on its website.

Gold Insignia gives investors gold bars with a value equivalent to 70 per cent of the invested sum.

It promises 4-per-cent interest every three months and investors can sell their gold back anytime at the market price.

Former NTUC Income chief executive and consumer rights advocate Tan Kin Lian said such gold investment schemes could be operating on the basis that money from later investors is used to pay the earlier ones.

He also urged for greater regulation, saying: "The Government should make it illegal for any company to operate an investment scheme without getting a licence from MAS. They should not be allowed to collect deposits or investments and promise a high return, when they do not have the assets to back up their liabilities." Teo Xuanwei

[Dennis Ng]

I hope my warning in the last few months about all these supposedly "Gold Investments" have helped some people avoid losing money.

I repeat my message:"Gold does not give you interests, if someone says it does, be very afraid."

Now one such company is in Liquidation, hope you're not one of them who lost money: http://thefinance.sg/2011/02/01/the-gol ... quidation/

[wemakebread]

Both XXX & The Gold Label have found themselves on MAS Investor Alert, joining SwissCash, Sunshine Empire, Profitable Plots and others.

http://www.moneysense.gov.sg/check_our_ ... l_IAL.html

I got the update from www.lioninvestor.com.
http://www.lioninvestor.com/XXX-gol ... lert-list/
If you like this website, it is possible to subscribe & be part of their mailing list, for news updates.

Personally I have it to be a useful resource.

[lootster]

Golden fleece

Source: The Business Times Author: Genevieve Cua 19/2/2011

IN THE last few months, netizens and investors have puzzled over a number of so- called gold investment schemes that aim to pay you regular returns. Are they scams? Gold, after all, does not pay any income, so how are the firms able to pay out as much as 24 per cent per annum?

Two firms with such schemes have been put on the Monetary Authority of Singapore's (MAS) Investor Alert list. The latest on the list is XXX Pte Ltd.

Late last year, The Gold Label Pte Ltd was put on the list. The company has filed to wind up its operations, reportedly due to cash flow problems. MAS' Investor Alert list reflects persons who are unregulated, and 'may have been wrongly perceived as being licensed or authorised by MAS'.

There are similarities in The Gold Label and XXX. They appear to be Malaysian in origin, or at least have Malaysian directors. Both were investigated by Bank Negara on suspicions of illegal deposit taking and money laundering.

XXX Sdn Bhd was investigated in 2009. Three of its directors - who are also directors in the Singapore company - will stand trial in April in Kuala Lumpur on charges of alleged money laundering.

Bank Negara's investigation of The Gold Label started last year, and is ongoing, based on information on Bank Negara's website.

What exactly is the firms' investment proposition? Information on The Gold Label isn't widely available; its Singapore website has been taken down. The firms straddle a fine line between investment and a retail business.

XXX, for example, has a police licence that enables it to sell second-hand jewellery, gold, and white gold. The fact that customers take home physical gold in the form of bars or coins suggests that the firm isn't taking a deposit or acting as investment manager.

Here's how the scheme appears to work: Customers buy gold from XXX at a fairly substantial premium to the market of about 22 to 25 per cent. This is based on a comparison of prices quoted by XXX of roughly $75 to $76.50 per gram against the price quoted by UOB and other retail gold dealers of roughly $61.

XXX tells customers that it sells the gold to them at a so-called 'discount' of between 1.5 and 2 per cent. It extends an option to customers: it will buy back the gold after 30 to 36 days or after 90 days depending on the scheme, at the original full purchase price. Those who exercise this get to keep the 'discount' of 1.5 to 2 per cent.

Customers may rollover the purchase, and hence they could potentially pocket as much as 18 to 24 per cent a year, from an asset that actually doesn't pay any yield.

How is this done? XXX has declined to answer questions for now, citing the pending court case in Malaysia. It adds in an e-mail that it expects a 'positive outcome' from the court case.

There are a number of aspects that should cause scepticism. First, the firm illustrates its buyback option on its website in a rather disingenuous fashion. It says customers buy gold at a 'discounted market price'.

But the truth is customers buy gold at a sizeable premium to the market. The firm also does not explain what it does with the premium that it pockets. Presumably commissions are paid to the sales people.

Its website says it has a 'proprietary trading platform' which enables it to 'adopt an active hedging and leveraging strategy' that makes the buy-back option possible.

On whether the scheme is Ponzi in nature, The firm's Malaysian counterpart told a Malaysian paper in 2009 that it is 'obvious' that it is not a Ponzi scheme.

What is likely to transpire is that the firm takes the 22 to 25 per cent premium that it gets from customers' purchases, and after paying off costs and commissions, it could buy and sell options on gold, through which it hedges its exposure.

As long as the gold price rises or is steady, it can continue, and even thrive, as it sources for gold at substantially lower prices on the open market. If gold however drops on a sustained basis, it could face a cash crunch if investors rush to sell back their gold in substantial numbers. This is because it is obligated to buy back the gold from clients at a high price.

Those who enter the scheme are likely to be enamoured of the so-called return, but they face two major risks - price and counterparty risk. As long as gold rises enough to cover their cost, they could sell their XXX gold in the open market. Over the last year, gold has risen some 26 per cent, based on spot prices.

If gold falls substantially, however, the counterparty risk becomes a material one, as you can recover your cost only if XXX stays solvent. Those who roll over their purchases must reckon that the potential return far outweighs the risk of loss. XXX agents tell investors that the worst loss they may suffer is about 20 to 22 per cent, roughly the premium they have paid.

Effectively, XXX has sold investors a put option along with gold, charging them a premium for it, and sweetening that by sharing some of that premium at the end of the contract period of a month or three months. As the put option writer, XXX's risk is potentially unlimited if it has not hedged its exposure.

Rollovers, by the way, incur price risk - that is, you re-purchase the gold at the price XXX quotes you which is presumably pegged to the market price. If gold rises, as it has over the last year, you end up investing larger amounts.

So, who is XXX? According to filings with Acra (Accounting and Corporate Regulatory Authority), it was registered as a business in 2008 dealing in gold bullion. It has an issued and paid-up capital of $500,000.

Three shareholders are Malaysian, and they are the same ones who will have to fight money laundering charges in Malaysian court. There is one Singapore shareholder. Attempts to contact him were unsuccessful as he was reportedly travelling or in meetings.

There are clearly more transparent ways to invest in gold, without dealing with a counterparty which could shutter its operations as The Gold Label did.

UOB offers a gold investment account, for instance, where you can hold physical gold and re-sell it to the bank. Those who need not buy physical gold but want a piece of its price action can get it through the SPDR Gold ETF. The latter is exchange listed and is easily traded through a broker.

gen@sph.com.sg

[lootster]

Investment alert, 15 April 2011

Gold Bar at inflated value

My friend asked me about investing in gold bars 3 months ago. I advised him to avoid it, as I do not understand how it
worked. He had already invested, but did not tell me at that time. He told me today that the company that promoted
the label "TGL" did not honor their promise to buy back the gold bar at the invested value and had since ceased
operation.

He is now stuck with the gold bar which has depreciated by about 15% in value, compared to his original investment.
He had since learned that he had paid for for the gold bar at a price that was higher that its market value. The person
who had sold the gold bar to him, being a friend, was also not aware about the inflated price and had also invested a
lot of her own money.

I recall another case about a lady who was quite keen to invest in 2 kg of gold bar at $140,000. She sought my advice,
I asked her to calculate the value of the gold bar by converting from kg to ounces, apply the world price expressed in
USD in ounce and convert to SGD. She found that she would have lost nearly 20% of the invested sum, as the gold bar
was priced at an inflated price. She decided not to invest in the gold bar. I must have saved her at least $20,000, by
avoiding this bad investment.

I had asked her to make a donation to FISCA in return for my advice, if she found it to be valuable. Perhaps, she felt
that my advice was not worth while so she did not make any donation. I am not able to recall who she was.

Tan Kin Lian

Here are my past blogs on investing in gold bars:
http://tankinlian.blogspot.com/search?q=gold+bar
http://tankinlian.com/admin/file.aspx?id=186

[Dennis Ng]

Taken from http://www.ifa-sg.com/the-gold-label-ma ... lert-list/

The Monetary Authority of Singapore (MAS) has placed The Gold Label in The Investor Alert List. According to The Investor Alert List website – “From time to time, MAS receives information on unregulated persons who have been mistaken as being licensed or authorised by MAS. Consumers should exercise care when dealing with these persons. Overseas consumers who receive solicitations by persons who claim to have an operation in Singapore should also exercise care and check if they are in fact dealing with persons who are regulated by MAS.”.

Others listed in The Investor Alert List include Sunshine Empire, Profitable Group and Swiss Cash.

According to the MoneySense site, the telltale signs of unregulated person include high-pressured sales tactics and promises of high returns, ‘guaranteed’ profits and quick gains.

This is such a serious issue, that I've decided to classify this discussion thread as an announcement, so that everyone reading this forum, will be alerted of this discussion.

it's not just Gold Label, the company. The real problem is the scheme cannot be sustainable, so no matter which company, it is just a matter of time they will go bust.


I really sincerely urge ALL Seminar graduates out there, if you know of any friends who are involved in selling this investment to the public, please ask the person to Stop ASAP, one day, he/she will regret it when he/she NOT only lost money, but lose friends and relatives when such schemes go bust.

If you have invested in a scheme like this, please try to get out as soon as possible before it is too late.

Ask yourself, how would such a scheme be sustainable? I have shared in my Secrets to Making Money in Stocks Seminar the CORRECT way to invest into Gold and Silver, do NOT invest through such schemes.

If you attend my How to Save and Accumulate One Million Dollars Seminar, please go through the notes on "what are the common features of scams" and you should know what to do.

[woonty]

Investment alert, 15 April 2011

Gold Bar at inflated value

My friend asked me about investing in gold bars 3 months ago. I advised him to avoid it, as I do not understand how it
worked. He had already invested, but did not tell me at that time. He told me today that the company that promoted
the label "TGL" did not honor their promise to buy back the gold bar at the invested value and had since ceased
operation.

He is now stuck with the gold bar which has depreciated by about 15% in value, compared to his original investment.
He had since learned that he had paid for for the gold bar at a price that was higher that its market value. The person
who had sold the gold bar to him, being a friend, was also not aware about the inflated price and had also invested a
lot of her own money.

15% loss is a good lesson learned but what could be worst is that "what if" those are fake gold plated tungsten cache which is not even gold in the first place!!!

Read this http://remnantbrideofjesus.blogspot.com ... nkers.html