CITY HALL — The Santa Monica City Attorney’s office last week confirmed that a local gold company is under investigation after receiving complaints that the business was possibly scamming customers.
The company, Superior Gold Group (SGG), is apparently based in Nevada although it also operates out of an office on Wilshire Boulevard in Santa Monica.
One of the complainants, Mr. Roberts from Tennessee, who preferred to use only his last name, said that after seeing a commercial for the company on Fox News last December, he and his wife looked into investing their savings in gold coins.
Convinced of the company’s legitimacy, they called a hotline and received a brochure in the mail. After speaking with a representative, they sent in a cashier’s check for $10,000 worth of gold.
Four months later, they still have not received their order.
After the promised delivery date came and went, Roberts called the company only to find that his account executive no longer worked there. He then spoke to other representatives who told him that his order would be shipped shortly.
When the coins still did not arrive, Roberts finally managed to contact the listed president, Art Jackson, who assured him that he would personally make sure that the order was shipped immediately.
“Now when I call the company and try to talk to Mr. Jackson, he says ‘Leave a message and I’ll get back to you within 24 hours,’” said Roberts. “But that doesn’t happen.”
After deciding they had been scammed, Roberts tried to contact the Better Business Bureau (BBB), but to no avail.
Roberts’ story bears strong resemblance to that of another ex-customer.
“My client found it totally impossible to get in touch with anyone from the company,” said Matt Ferguson, an attorney from the Colorado law firm Garfield & Hecht.
Ferguson’s client, Ray Larsen from Miami Beach, Fla., is currently suing SGG for allegedly accepting a $250,000 payment for gold coins and failing to deliver the product or return his money.
According to a complaint filed by Larsen last December, “Upon information and belief, SGG and [their president John] March have used and/or lost Larsen’s money in a Ponzi-type scheme and/or have used Larsen’s money to capitalize on the run-up in the price of gold for Defendants’ own illegal benefit.”
Larsen and Ferguson are still waiting to go to court, a process which has been further complicated by difficulties in contacting representatives from SGG. Ferguson expressed that interaction with the company’s attorney has been less than straightforward.
“I’ve spoken to him and haven’t got much help out of him,” said Ferguson. “I’m not sure where he is actually located.”
The case will go to court in the coming months.
According to Ferguson, reports of fraud have been emerging across the country.
“We’ve spoken to people in Arizona, the Carolinas, Georgia, and we’re suing them in Florida,” said Ferguson. “We’ve been contacted from people all over.”
Calls to the company’s attorney for comment have not been returned.
SGG’s website claims that the company “has been in business for 10 years without complaint,” though it mentions that “a disgruntled employee” has posted negative reviews on the Internet. The website further asserts that the “employee” is being sued.
The company’s website claims that they have maintained a “stellar reputation” over their 10 year history, receiving “nothing short of glowing praise” through the Federal Trade Commission, Securities and Exchange Commission, and the Better Business Bureau (BBB).
The BBB has given the company an “F” rating, partly based on the fact that out of 25 complaints, six have gone unanswered.
“It’s common for this kind of business to have occasional complaints,” commented an official from the City Attorney’s office. “Even legitimate businesses have complaints from time to time. Still, the rating is not the only thing you want to look at.”
News of SGG’s investigation came to light shortly after New York Congressman Anthony Weiner publicly attacked Gold Line International — another gold company based in Santa Monica — claiming that it overcharges for its coins and uses unethical marketing tactics that play on customers’ fears of the troubled U.S. economy.
Weiner also criticized talk show host Glenn Beck, a professed client of Gold Line International whose show is also sponsored by the company. Superior Gold Group has also run commercials during Beck’s show.
Though the controversy over gold coins is as political as it is financial, for others like Roberts, it is very personal.
“I’m 73 years old and in bad health,” Roberts said. “I could try to get a lawyer and go to court but that would probably cost me more than what I’ve already lost.”
Representatives from SGG could not be reached for comment after several phone calls and visits to their Santa Monica office.