Gold IRA red flags cluster into 9 repeating shapes, and the useful thing to know about them is how few involve anything unlawful. 7 of the 9 below are entirely legal, clear every disclosure requirement, and still cost a reader more than a decade of account fees, because a 6% markup on a 50,000 dollar purchase is 3,000 dollars against roughly 180 dollars a year in administration.
Most of the money in this category is lost to price, not to fraud.
A coin sold at a wide markup over its metal content is a lawful transaction between consenting parties, and it will not appear in an enforcement action or a complaint statistic. It shows up later, as a position that has to rise 20% or more before it breaks even, which is why every one of the 4 questions below is about price rather than about honesty.
The patterns
The numismatic upsell
What it looks like. The call starts on bullion and moves to graded, proof or collectible coins, described as rarer, better performing or exempt from reporting.
Why it works. Bullion carries a markup a reader can check against the spot price in a minute, while a collectible has no reference price at all, so the margin stops being comparable and becomes whatever the seller says the coin is worth.
Lawful What to ask. What is this coin's price as a percentage over spot, and what will you buy it back for today?
The home storage arrangement
What it looks like. An LLC owned by the IRA buys the metal and you keep it in a safe at home, described as a checkbook IRA or a home storage IRA.
Why it works. It sounds like control and it removes the storage fee, which is the objection most readers raise first, so the pitch answers a real concern with an arrangement the Tax Court has already ruled on.
Not lawful What to ask. Has this structure been tested in court, and what happened in McNulty?
Free silver and bonus metal
What it looks like. A quantity of silver is offered at no cost for opening above a threshold, or as a match on the amount transferred.
Why it works. Nothing is free. The cost sits inside the markup on the gold being bought, and the offer works because it converts a price negotiation into a gift, which people argue about far less.
Lawful What to ask. What would the same order cost without the bonus?
Fees that appear after the paperwork
What it looks like. The schedule is described on a call rather than sent, or covers the custodian's charges while leaving the markup and the buyback spread unquoted.
Why it works. A reader comparing companies on setup and storage alone is comparing the small half of the cost, and the half that decides the outcome never enters the comparison.
Lawful What to ask. Send me the full schedule in writing, including the spread on a sale.
Guaranteed or projected returns
What it looks like. A specific return is promised, or a chart projects one, sometimes with a buyback guarantee attached at an unstated price.
Why it works. Retirement money is being moved by someone who cannot afford to lose it, and a number attached to the decision does what a hedging argument cannot.
Not lawful What to ask. Put the guarantee in writing with the price and the term.
Manufactured urgency
What it looks like. A deadline, an allocation running out, a price about to move, or a macro event framed as imminent.
Why it works. Urgency removes the step where a reader checks a quote against spot or reads the schedule, which is the only step that reliably prevents the loss.
Lawful What to ask. There is no question worth asking here, because a decision about retirement money does not carry a deadline set by the person selling into it.
Celebrity and media endorsement
What it looks like. A broadcaster, former official or television personality is presented as recommending the company.
Why it works. It substitutes a familiar face for a fee schedule, and the FTC requires the material connection behind that endorsement to be disclosed clearly, which is often where the disclosure is thinnest.
Lawful What to ask. Is the endorser paid, and where is that disclosed?
Storage that is described rather than named
What it looks like. The metal is said to be in a secure, insured, world-class facility without the depository being named or the account structure specified.
Why it works. Segregated and commingled storage cost different amounts and mean different things about what you own, and a description that avoids both avoids the comparison.
Lawful What to ask. Name the depository and tell me whether the holding is segregated or commingled.
No written buyback policy
What it looks like. The company says it will always buy back, without a written spread, a settlement time or a stated method for pricing.
Why it works. The cost of selling is fixed at the moment you buy, and a verbal assurance leaves the only competitive number in the transaction entirely at the seller's discretion.
Lawful What to ask. What is the buyback spread in writing, and how many days to settle?
The four questions that end most of it
Every pattern above is defeated by the same small set of questions, asked before anything is agreed and answered in writing rather than on a call. A company that will not answer them has told you what you needed to know, which makes the refusal as useful as an answer would be.
- What is the full fee schedule, including the custodian's charges and the buyback spread?
- What is this coin's price as a percentage over spot today?
- Which depository holds it, and is the holding segregated or commingled?
- What will you pay me for it if I sell in a year?
Where to report a problem
The Commodity Futures Trading Commission takes complaints about precious-metals fraud and runs a public enforcement docket. Your state securities regulator handles conduct aimed at retirees, which several states pursue more actively than the federal agencies do. Both are worth contacting before signing anything carrying an arbitration clause, since that clause usually narrows what you can do afterwards.
Sources
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Precious metals fraud advisory
The pressure and markup patterns described above.
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Gold and precious metals, consumer guidance
Endorsement disclosure and the questions to ask a dealer.
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McNulty v. Commissioner, 157 T.C. No. 10
Home storage arrangements treated as a taxable distribution.