As the CFTC uncovers another fraud, the long arm of the law has caught up with Anthony Lauria and his firm; Gold Coast Bullion. CFTC uncovered Gold Coast Bullion fraud under the management of Anthony Lauria and found them guilty of fraudulent activities involving illegal, off-exchange precious metals transactions. Moreover, Gold Coast Bullion, Inc. got caught operating without relevant licensing from Futures Commission Merchant (FCM).
Respectively, Mr. Lauria and the adjunct GCB telemarketing service were constantly seeking customers for financed precious metals transactions. Once lured in, their potential clients were advised to only deposit a meager percentage of the total metal value, on average around 25%. Consequently, the GCB would render a loan to covering the remaining 75%, while levying the deluded customer with a finance and service charge for the loan.
The CFTC found these practices deceptive, therefore misleading clients as to the firm’s actual operating system. Firstly, GCB failed to execute clients’ orders on an approved exchange as required by law. Secondly, the firm was not registered to receive funds or give credit to customers. Thirdly, GCB received compensation in aggregating over $2.6million as commission to deliver these precious metals, however in reality never delivered any precious metals.
In the process on CFTC’s investigation, it came to light that AmeriFirst Management LLC (AML) was part of these malpractices. Uncovering, that GCB did not actually purchase or sell any physical metals, but issued fake confirmations in its name, instead of forwarding the orders to AML for execution. In regards to these transactions, AML did not purchase or sell any physical metals. AML dealt with these transactions by using derivatives in margin trading accounts, opened though other brokerage houses, utilizing this to track the value of client accounts. Nevertheless, AML already got levied by the CFTC for illicit transactions and fraud, back in July 2013.
In response, the CFTC has prompted a fine of $5,940,124.16 payable as restitution, conjointly with a civil monetary penalty of $3.75 million leading to a total of about $9.6 in fines. On top of these fines, Mr. Lauria and GCB are permanently banned from any registration and trading related activities.