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Minnesota Attorney General Sues Another Coin Dealer

Lori Swanson, Minnesota Attorney General filed suit Friday against a defunct Twin Cities coin dealer and two of its officers on allegations they had cheated consumers around the country out of hundreds of thousands of dollars. Swanson, who has filed suit against coin dealers accused of defrauding customers before, has also announced legislation intended to regulate the industry in her state.

The lawsuit filed against Guardian Gold & Silver Exchange of Plymouth owner Ray Hanisco and vice president and chief operating officer Schaun Waste alleges they accepted coins from consumers for which they failed to pay and they failed to fulfill orders after being paid.

According to the Star Tribune, telemarketers working for Guardian targeted elderly consumers around the country.

Merlin Habegger of Niceville, Florida, said the salesman who called him in June gave a tremendous sales pitch that prompted him to purchase $6,000, but he never got any coins and company officials did not return his phone calls.

Ernest Gremillion of Alexandria, Louisiana, got a court judgment against Guardian for about $100,000. The semi-retired coin dealer said Hanisco spent a week in Louisiana going through his collection for coins to exchange. He said the coins delivered to him were very overpriced.

Hanisco was not reached for comment. He filed for bankruptcy in October, listing assets of about $45,000 and debts exceeding $1.7 million.

Swanson and Commerce Commissioner Mike Rothman announced legislation on Friday that they said would grant greater protections to people who buy gold, silver, and coins. The price of gold is up 500 percent in the past decade, making the precious metal a target for fraud.

Debra Hilstrom, chair of the House Judiciary Committee, said this is the only investment area that is not yet regulated. She added when folks are saying that they’re selling an investment, the public expects that they’re going to get what they’re sold.

The best protection against fraud and counterfeiting is to purchase your gold and silver coin through a certified dealer with professional accreditation including affiliations with professional publications. Proper storage of bullion is also important, but a long-term relationship with a certified, professionally accredited coin dealer is an absolute must in the era of high prices for gold and silver coins.

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