CITY HALL — Forty-one customers of Santa Monica-based Goldline International, Inc. have returned precious metals they purchased from the company and have received more than $4.25 million in refunds, according to a statement released Thursday by City Hall’s Consumer Protection Unit.
Goldline has also paid $800,000 into a fund for those customers who still want to keep their gold coins but would like to receive the difference between their original purchase price and the current value of their coins.
The money paid is part of a settlement Goldline reached with City Hall in February. City attorneys filed suit against Goldline claiming its employees tricked customers into buying gold coins with a marked up value, sometimes to the tune of 55 percent on top of the gold’s worth, and directed customers away from reasonably-priced gold bullion.
As part of the settlement, Goldline, one of the nation’s largest precious metals dealers boasting annual sales exceeding $500 million, admitted to no wrongdoing.
An injunction imposed on Goldline as part of the settlement goes into effect on April 22, which will require the company to:
• Disclose its actual price markups, in recorded calls before each transaction;
• Follow a strict, factual script when discussing certain topics with consumers;
• Not tell consumers that the government can confiscate gold bullion;
• Not attempt to sell customers higher-priced coins once they have already paid for bullion;
• Set up a new phone line, staffed by non-commissioned employees, for refunds, liquidations and other customer service.
A court-appointed monitor has begun his duties to assure Goldline’s compliance, city officials said.
Former customers who believe they were misled by Goldline must file a claim by May 22 at the following website: gold.smconsumer.org.
Goldline CEO Brian Crumbaker confirmed the refunds and said the company is “pleased that it completed the financial settlement with the city of Santa Monica.”
He emphasized that the settlement was voluntarily entered into and that Goldline was never found liable for any wrongdoing.
In a previous statement, Goldline said the number of customers who complained represented less than one tenth of one percent of the company’s customers for the three years of purchases reviewed in the lawsuit.