Monday, August 30, 2010

Dealer claims $500,000 in silver bars stolen from U-Haul van safely parked on secure, desolate unlit gravel road

The Gold and Silver Crash Course post covers the importance of steering clear of paper bullion, and stresses the importance of taking delivery. However, though not expressly mentioned in that post, storing bullion in a moving van parked along a desolate unlit gravel road would not qualify as safe storage.

Also, hopefully after reading this post, you already know one place where not to buy gold, despite the advice of talking head Glenn Beck. Well, here's another place where not to buy gold, silver, or even soda pops, and certainly not a place to trust to "store" even the empty soda cans: Global Bullion Exchange.

Global Bullion Exchange is running out of states in which to do "business," business which, according to documents obtained by various investigators, apparently includes losing their clients $29.5 million in Florida alone. Yet what is bizarre about this company is that despite having "closed overnight" in December of last year and filing for bankruptcy in Florida court, the operation continues to take investments through to this month, in at least one other state. From a May 12, 2010 article in the Sun Sentinel:

"Hundreds of customers from North Pole, Alaska, to Miami — many seeking a safe investment harbor in uncertain economic times — sent the company money so an advertised "team of experts" could guide them through the gold and silver markets. But when the Lake Worth-based company closed overnight, its books showed that at least 1,400 clients were out about $29.5 million. Some people saw their retirement nest eggs wiped out.

"It was 40 years of investment I lost," said social worker David Gruber, 72, who lost about $400,000 he put into precious metals. "It was 40 years of scrimping and saving. … Nothing has been the same since."

Amid the company's rubble, attorneys are scrambling to figure out what happened to customers' money and if there may literally be a pile of gold somewhere. A former company accountant has said in a sworn statement that the company's owner, Jamie Campany, once had more than $1 million in gold bars stashed in the trunk of his Mercedes."

(Trunks of Mercedes are also heretofore added to the list of places where not to store bullion.)

Yet, somehow Global Bullion Exchange continued operating in other states. The company's owner, Jamie Campany, is now facing lawsuits to recover the money. In addition to the $1 million in gold bars in his Mercedes, Mr Campany apparently found rental trucks, preferably parked on unlit gravel roads, to be proper bullion storage facilities. From a June 2010 Sun Sentinel article:

"Campany has told deputies from the Palm Beach County Sheriff's Office that the day after Global Bullion Exchange closed, up to $500,000 in silver bars were stolen from a moving truck he had parked along an unlit gravel road off South Military Trail in Delray Beach."

Well, Mr Campany would have put them in the Benz, put they just wouldn't fit! For visualization purposes, $500,000 in silver bars (at December 2009 prices, when the bars were said to have been "stolen") would weigh about a ton. But I can't be so hard on Mr Campany, because believe it or not, I can sympathize with him: I, for one, routinely leave that extra $1 million in gold bars that I have laying around in the truck of my Toyota--I mean, where else am I gonna put it? It doesn't fit in my purse? I also confess that have even forgetfully left the garage door open, exposing my 18 tons of shining silver bars to the whole neighborhood!


Oh, and I'll never forgot the time I accidentally put my 1907 High Relief Saint Gaudens into the vending machine at the stadium, thinking it was a quarter! You should have seen me--I kept trying to jam it in there, wondering why the brilliant and incredibly rare, super-fat, one-ounce gold coin wouldn't fit in the slot! I eventually got frustrated and threw it into a nearby koi pond. Oh, silly me . . . Mr Campany is quite right--this kind of thing happens all the time!

According to another article, a local business man from Sodfather Sod discovered the U-Haul, and as the back door was open, peeked inside only to see silver bars strewn about the floor. He called the police, and that's apparently when Mr Campany explained that he'd parked the U-Haul filled with over half a million dollars in silver there for safe-keeping, and that--oh my!--most of the bars were missing.

And now, 8 months later, Missouri Secretary of State Robin Carnahan is intervening with her authority in an attempt to stop this still-slithering "investment" scheme, which is continuing in Missouri. Last week, Mrs Carnahan ordered Global Bullion Exchange to "cease and desist", claiming that the scheme had defrauded Missourians of $100,000. According to Carnahan, Global Bullion Exchange was misrepresenting investment oppurtunities in silver as safe, while they were actually highly risky levered margin accounts.*** It is not the first time Mr Campany has been subjected to cease and desist orders or other censures. As the Saint Louis Business Journal reports:

"Global Bullion Exchange has been subject to cease and desist orders in other states, including California and Maryland. Jamie Campany, who ran several of the companies associated with Global Bullion, was the subject of a 1999 complaint by the National Futures Association for “deceptive and misleading sales solicitations,” and filed Chapter 7 bankruptcy in 2001."

According to this pdf from the FTC's "Operation Short Change," the State of California has issued this cease and desist order against Global Bullion Exchange and Mr Campany in January 2009, and yet here is a Rip-off report from January 2010, apparently from an Alabama resident who claims that the company is refusing to return $7,818. This poster also mentions that in his phone conversations with Global Bullion Exchange, he has detected that the company it "trying to change its name" to Metals Trading Group, LLC. Thanks to that tip, we can confirm it is true!

Metals Trading Group LLC is the new front for Global Bullion Exchange.

Check out the flashy new website, complete with lots of smiling, attractive professionals. Click on "
Our Company" and you won't get much information, and you won't see any mention of Mr Campany's name or Global Bullion Exchange (indeed, this ridiculously incomplete "Our Company" page should be an immediate tip-off for any company with which you're even thinking about doing business: this page is a joke!). Pretty much all you'll learn about the company from their site is that Metals Trading Group LLC alo goes by the shorted name MGT.

So, how can we see that MGT is, indeed, the new front for Mr Campany and his Global Bullion Exchange?
Astounishingly, the very Metals Trading Group account application (proving, perhaps, again that people never read these things) clearly states that the "principal" of Metals Trading Group LLC is no other than the above-mentioned Jamie Campany, and even describes his previous illegal behavior and failures!

"Metals Trading Group, LLC’s Chief Officer has settled a proceeding with the National Futures Association in May, 2000. There additionally have been State Cease and Desist or Injunctive Orders entered under state laws. On January 19, 2010 an assignment for the benefit of creditors was filed in Dade County, Florida under Florida law bearing Case No. 10-3077 CA 40 by Global Bullion Exchange, LLC, and Case No. 10-03076 CA 40 by Diversified Investment Group, Inc., companys which were wholly owed by the current principle of Metals Trading Group, LLC, Mr. Jamie Campany because they could not meet their financial obligations to customers."

I feel very sorry and sympathetic for those people who have lost so much to these "investment opportunities," mostly because they are usually old people with no means through which to recover what they lose. That said, the very fact that this above paragraph is included in the application for a new account--that fact that people are literally signing a document that clearly states that the owner of the company to whom they about to send thousands of dollar has had cease and desist orders and injunctions against him, and even lost two companies " because they could not meet their financial obligations to customers", this fact is a statement also on those who do sign. You should not have to sign any contract to buy bullion with any dealer, period. Nevermind a dealer like this one!

So, we can therefore add another bad bullion dealer to the list:

Metals Trading Group, LLC
Metals Trading Group LLC
333 Arthur Godfrey Rd.
Miami Beach FL 33140

I cannot confirm whether this front is currently operating, because when I attempted to call the phone number listed on the contact page (1-877-361-1110), the call "could not be completed as dialed." Imagine the feeling you would have if you heard that message when trying to collect your money.

You have been warned.

***(Bankster Report opinion: NO ONE should engage in margin investment of ANY kind unless he is utterly familiar with the very high risks and has the capital to lose and the funds to cover changes in prices. Margin investment in commodities is much more levered than in stocks, where leverage is restricted to 50%. Margin investment in commodities futures can be seeded with as little as 5%, hence both the upside and downside are extremely large. Also, commodities contracts held by margin are bought and sold on the futures market, like all other commodities contracts. Buying commodities on margin is not a game.)

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