DES MOINES — Fourteen Iowans who bought gold and silver coins from a company called GSI Exchange are eligible for $788,000 in refunds, according to the state insurance commissioner’s office. The Iowans have to return the precious metals to get their refunds
State Insurance Commissioner Doug Ommen said the refunds are part of a settlement the company reached with regulators in 44 states. “We coordinated an investigation that was being led by several states and CFPC, which is the federal regulatory body over precious metal transactions,” Ommen said. “We did order the payment of restitution.”
The refunds are for purchases made from GSI Exchange before July 21, 2021. On July 22nd of that year, regulators in Texas and Alabama issued a cease and desist order against the company, accusing GSI Exchange of allegedly telling investors their retirement portfolios were “high risk” and they should sell their securities and buy gold and silver coins. Ommen said consumers “were not provided important information” about their purchases.
“Some of the mark-up we saw on these coins, in other words the exaggerations concerning their value, was used to justify the commissions that the sellers were collecting for their own benefit,” Ommen said.
GSI Exchange was not licensed to sell precious metals in Iowa. Ommen recommends that Iowans check out a company before they make an investment. “Even those that involve coins that are sold through an exchange like this where you’re buying, in addition to the coins, the expert opinion of the person who is selling them, does involve the sale of an investment security,” Ommen said. “Whether it’s precious metals or other commodity investments, make sure as an investor it’s registered and has gone through the review process.”
GSI Exchange is required by the settlement to notify the 14 Iowans who bought coins that they are eligible for refunds.