Tuesday, May 18, 2010

Glenn Beck Fears FTC And SEC Scrutiny On His Sponsor And Employer, Goldline

I thought this was a great article from Media Matters by Will Bunch, discussing the blurred line between Glenn Beck's program and the company Goldline, who's product Beck peddles on both his program and as a paid spokesman for the company.  Finally someone has decided to step in and shed some light on what is going on.  Rep. Anthony Weiner of New York wants the FTC and SEC to investigate.
At this hour, Weiner is holding a news conference not only call out Goldline as "a company that uses conservative rhetoric, high pressure sales tactics and tall tales about the future of gold to sell over priced coins that can be bought somewhere else for cheaper," but to ask regulators from the Federal Trade Commission and Securities and Exchange Commission to investigate its tactics.

Weiner's staff investigated Goldline and found that the coins it sells are not the good investment that its salesmen -- who are not licensed investment advisers -- claim that it is to consumers, because the price of gold would essentially have to double beyond its current high to begin seeing any gains. Specially, the investigators found Goldline coins selling for 90 percent above the melt value of the coin, that is, its value by weight. The largest markup seen on a coin, Weiner said, was 208 percent above the melt value.

"In the past there is always the “product” that is either the next big thing (the dot com boom) or the investment that will never go down in price (the housing market), and in the past much of the media has failed in its duty to conduct due diligence, but never before have they worked so hand in hand to cheat consumers," Weiner said in his prepared report. "Commentators like Glenn Beck who are shilling for Goldline are either the worst financial advisers around or knowingly lying to their loyal viewers."
Weiner seems to have struck a chord with the fearmongering Beck, but what does Beck have to fear?  Bunch goes on to write:
The Brooklyn congressman sent letters to the heads of the FTC and the SEC requesting that some of Goldline's more questionable tactics be investigated. In addition, he says he will propose legislation requiring full disclosure of hidden fees, the purchase price/Melt value/Resale value, and how much the cost of gold will need to rise in the value for the customers’ investment to be profitable. All common sense ideas.
This has Beck screaming about McCarthyism, claiming the government is now targeting his sponsors to get him off the air.  Using the same argument conservatives made against critics of the Arizona immigration law, what does Beck have to fear?  If Goldline does all that is required - post purchase prices, melt values, resale values, etc., and they are on the up and up, then they should continue to succeed.  Beck argues that Goldline is a great investment, but gets upset when they face the same scrutiny other investment firms face. 

Beck and Goldline have nothing to fear unless they know they are doing something wrong.

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