All That Glitters is Not Gold: Gold Bar Scams

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[00:00:01] Bob: This week on The Perfect Scam.

[00:00:04] Mike Kakoullis: The detectives called me and they're basically setting up a sting. So we had them come to the shop and we laid out a bunch of gold and we made it look like there was more than there was because we don’t keep that amount on hand. We set it up and made it look like about $350,000 worth, and they took some pictures of it to send to them and we made them a fake invoice.

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[00:00:35] Bob: Welcome back to The Perfect Scam. I'm your host, Bob Sullivan.

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[00:00:13] Bob: Criminals have recently seized on a new, old-fashioned way to steal money – gold bars. Yes, gold bars. And we wanted to tell you about it right away because law enforcement officials and gold store dealers both are ringing the alarm bells. You'll hear from them in a moment, but first, listen to what happened to Eva Rothman of Queens, New York. She's Aunt Eva to Rabbi Lyle Rothman, her nephew.

[00:01:08] Rabbi Lyle Rothman: So my aunt and uncle never drove, or I should say it this way, my uncle drove sometimes, but it was better off that he didn't. And, and there were a number of times that I remember my parents going away on vacation, even for a short weekend, and my aunt and uncle and my cousin coming to stay at my parents' house on Long Island, and we, every day I, I actually, I, Auntie, I don't know if you remember this, every day I do remember being an adventure. I remember us walking all over town, from morning till evening going to a restaurant for dinner, or to the playground at my elementary school where I grew up. And, and I...

[00:01:48] Eva Rothman: Did you remember, wait, do you remember the pu pu platter?

[00:01:52] Rabbi Lyle Rothman: And I remember going to the Chinese...

[00:01:53] Eva Rothman: That was your favorite.

[00:01:54] Rabbi Lyle Rothman: My Chinese restaurant and getting the pu pu platter because my parents would never let me get that. But my aunt would always, but my aunt always allowed that. So I, I always, I have vivid memories of having just a lot of fun and it's the fun that, that is the smile that comes through and really is why, it's just, it's heartbreaking. You know this is just heartbreaking.

[00:02:16] Eva Rothman: Yeah.

[00:02:17] Bob: What's heartbreaking is how a woman who had spent her whole life building up a decent sized retirement nest egg now finds herself asking strangers for financial help and even visiting food banks. Bob: It all started a few months ago when...

[00:02:34] Eva Rothman: I was surfing the internet like I always do, and I was on a safe site which was Amtrak, just 'cause I was going on a, a trip later, but that's, you know, not important. So I was, you know I was just going to look at schedules and then my computer just locked all of the sudden for no reason, and I couldn't move the mouse or the keys or anything. And then I, this thing came on the screen with a phone number and a voice saying that if I call this number that they would unlock me and then that everything would be fine. I thought it was just one of those things, maybe a virus or whatever, so I did call the number...

[00:03:23] Bob: Eva speaks to a person who says he's with the Federal Trade Commission, and he says he Social Security number has been compromised. Even worse, it's actively being used by criminals to open accounts all over the world.

[00:03:38] Eva Rothman: So she's scrolling down and it was showing different, different people or accounts that were opened in my name in different countries, and the people who were involved in pornography and drug cartels. You know, and I mean it just sounded so weird, and but you know I was scared because it just looked like how are they getting all this information? You know what's going to happen to all my money?

[00:04:08] Bob: Yeah, yeah.

[00:04:09] Eva Rothman: And that this person from the Federal Trade Commission said that they're going to investigate who is involved in this, and that in the meantime they can, they connected me to a person who um, he was in charge of safeguarding my money.

[00:04:30] Bob: This person in charge of safeguarding her money says his name is Officer Michael Collins.

[00:04:37] Eva Rothman: And so he said that he was going to safeguard my assets and anything that was connected to my Social Security number because of what, you know, what was going on. If I don't close the account, that I would lose everything.

[00:04:56] Bob: They said she would lose everything if she didn't follow their instructions. So Eva follows them carefully. And that includes not telling anyone in her family what's going on. First order of business, protecting the $20,000 she has in her checking account. She has to withdraw all that money and put it in a box and take pictures of it and hand it over to a courier.

[00:05:26] Bob: And did these guys come in the middle of the day? How did they pick up the money?

[00:05:29] Eva Rothman: Yeah, they came during the day time. And I couldn't, I mean everyone said to take pictures, but I wasn't supposed to, this was supposed to be private, and I was under surveillance. So I, I couldn't even take pictures.

[00:05:47] Bob: Then Officer Michael Collins calls and asks about the rest of Eva's assets. What other money does she have? Well she has that cash in her retirement account, some of it inherited from her father and brother. And all that money has to be saved, he says.

[00:06:04] Eva Rothman: I have to exchange all the money that I had in my account into gold bars and coins, and that, I never heard of such a thing. So I questioned it, you know, to the person I was talking to, the Officer Michael Collins, and he said that that is a, it's safer than cash, and that I would get the money, I got out to take the gold bars and coins and keep it in a gold reserve they called it, and then when the investigation was over that I would be getting a check for the total amount that I had to take out of my account to buy this gold. And a new Social Security number on top of that. I mean it kind of seemed strange, but I just kept thinking in the back of my head that they had me on surveillance.

[00:07:01] Bob: So feeling like she's being watched, Eva goes to a local gold store, one Mike Collins tells her to visit, and buys gold with her cash.

[00:07:12] Eva Rothman: It wasn't done in one, it was done in three different intervals because of the amount that was, that I have to tell them. They didn't want it to look so out of the ordinary. So they broke it up into three accounts.

[00:07:27] Bob: And each time she has to arrange a drop off with Michael Collins.

[00:07:32] Eva Rothman: Yeah, I had to give him a password, but I chose a personal password. He would give that to the person that was coming to pick up the gold, and when I saw the car pull up and saw these persons, which I didn't even know, they never explained to me the car, the type or what, who the person was, but I just have to assume it was who I thought it was. So when I would go downstairs, oh, he gave me a time that they were coming, so I knew when to, when to look. So I would go to the car thinking he was the person. I, and he said, "Yeah. I was sent by..." he mentioned that person's name, Michael Collins. And I said, "Do you have the password?" And he would say the password, which was the one I gave, so I figured it was him. I, I handed it over, actually I didn't hand it to him. He told me to put it in the back seat of the car. He never came out. They drove off and never to be seen again, and that was, that was the end of it, you know.

[00:08:39] Bob: That was the end of it. Michael Collins assures her the investigation will be closed shortly and she'll get her money back quickly.

[00:08:47] Eva Rothman: And then at the end, at the last call, I was told that within the next couple of days I would be getting somebody coming to deliver the check in person with the new Social Security number. So I waited for the day that I was told that they would be there, and no one showed up, and I, I kept calling the person who told me this was going to happen, and then the phone number was disconnected. I couldn't even reach the person that I was dealing with through this whole time. And that was very strange, the phone number was disconnected all of the sudden.

[00:09:24] Bob: But when the number's disconnected, I mean what, what did you think?

[00:09:28] Eva Rothman: I had, I knew something was going on at that point, basically that I didn't get anything back or hear from anyone, and I called information just to see how, who belongs to that number because I couldn't get through and then they said that they never, that number doesn't exist. And that's, that's when I knew that this whole thing was a hoax.

[00:09:55] Bob: Ugh. I know it's so hard, but can you try to explain to somebody what that feels like, that moment when you say, oh no, my money's been stolen?

[00:10:03] Eva Rothman: I mean it was everything. I, they wanted everything.

[00:10:11] Bob: They wanted everything and they stole everything.

[00:10:16] Eva Rothman: It ended up with me losing almost $700,000, and that was my life savings. I was going to go; I have an adult daughter. That was going to be her inheritance when my husband and I are gone. Now she has nothing. And I...

[00:10:31] Bob: Some of that money is, was from your parents and your brother too, right?

[00:10:35] Eva Rothman: Yeah, that was also part of my brother's life insurance, that was his money too. Yeah, so that was it. I'm, I'm broke, so I guess you could say. I'm living with Social Security and that doesn't go too far to, if you know anything about that.

[00:10:51] Bob: And even as she's learning to scrape by on the minimum, Eva still keeps the secret about the gold bar thefts from her family, at least for a while. They don't find out about what happened until Eva posts about it on social media.

[00:11:07] Rabbi Lyle Rothman: I was actually on Facebook, and just looked, I was just was scrolling on Facebook and came across my aunt who posted, and she posted a GoFundMe page. I, at the time, actually thought that was the scam and that my aunt's Facebook was hacked. So I called my parents and basically took a screenshot of it and said, "Can you call, can you call my aunt? Can you call to see what's going on?" And sure enough, they called, my parents called and found out that the scam was not that her Facebook was hacked, but that uh she has lost essentially 7 thou--, hundred thousand dollars, $700,000.

[00:11:48] Bob: And what is it like to hear something like that, Lyle?

[00:11:51] Rabbi Lyle Rothman: Well I have to say as a rabbi who deals with people when they are at their highest high and their lowest low, I, I am sort of, I don't know well-equipped, but sort of, I guess I expect when people come to me and they're at their lowest that I am off-, there, able to offer comfort and perhaps even perspective, but this was very new for me. This is my family. This is my aunt, my uncle, my cousin, and I felt very, I felt a vulnerability that I think so many of my congregants feel at times when they are searching for answers and asking why, and I had no answers except, frankly, just as I understood the story, I felt a lot of anger. How could another human being do this? And not just do this, I mean again, someone loses any, any money is lost is a lot, but $700,000 is more money than many people have and how could they do this? How could they live with themselves? And how could they do it to my family? I, I was truly, I was heartbroken and, and angry.

[00:13:03] Bob: And I understand you guys don't live in the same neighborhood exactly, but you're not too far. Did, did you or any of the other family members notice anything strange while this was going on?

[00:13:11] Rabbi Lyle Rothman: Honestly, we didn't, and, and that's the thing. My, my aunt continued, they, they had a scheduled trip to go to Disney World.

[00:13:20] Eva Rothman: Oh yeah, I wouldn't miss that.

[00:13:22] Rabbi Lyle Rothman: And they went to, they went, they continued to go to Disney World, and this was all happening in, in July, meaning that they were still trying to live their life because they had commitments, because again, their idea was that this money was coming back, or as far as we understood. So much so that we even spent the Jewish holidays together, Rosh Hashanah. They were at, at our house on Long Island, and, and we didn't know about it then. It was only a few weeks later that I noticed the GoFundMe page. We don't, I, we, my family, we don't blame her for that. We are so sad. And again, and angry that this happened more than anything else.

[00:14:03] Bob: Eva didn't tell her family because in a way she was protecting them.

[00:14:09] Bob: Looking back at that, at Rosh Hashana, that must be really painful to think your aunt was sitting there in such pain and not able to talk about it.

[00:14:17] Rabbi Lyle Rothman: Well and yeah, and so we, again, we thought through those moments, were there signs? Was there anything that, that didn't seem normal or, and the reality is, my aunt to her, to her credit, is always able to find, usually able to find something positive in something negative.

[00:14:36] Bob: Eva, actually what I'm hearing is a woman who cares so much about her family that she doesn't want to bother them and ruin their holiday even though something negative is happening. Is that really what was going on for you?

[00:14:47] Eva Rothman: Yeah, exactly. I just, I didn't think it was the right time and place to discuss it, and I wanted to have a good time too. And we don’t get together that often. You know it's kind of like putting it on the back burner.

[00:15:01] Bob: But there is a darker reason for the secrecy too, her nephew thinks.

[00:15:07] Rabbi Lyle Rothman: I would say, Bob, the other piece of this is there is, there's real shame. I, I've spoken to so many people who have heard about this story and they ask the same question; so how could this happen, and at the same time, what do we have to do to prevent something like this to happen? So for my aunt not telling us right away I imagine and she's expressed to me a little bit that there is a feeling of regret. How could, how could she not be smart enough. And I don't think it's about being smart. The reality is these criminals, these people who do this are so savvy that they can manipulate a situation so anybody, even the most technologically savvy of us, even whether we're old or young or just vulnerable, they prey on our vulnerability. Anyone who's going to say, you've, you know you can go to jail, your family can go to jail if you don't comply is going to go into that mama bear mode and going to do whatever you can to protect your family. And I know that's what my aunt did, and then when you realize that, that everything was a scam, you have to feel shame, and that's the emotion that I think is the most human, and at the same time, doesn't bring back the resources, the money that was stolen by these criminals.

[00:16:30] Bob: Overnight, Eva goes from having a sizeable nest egg, and maybe something to leave her daughter, to having nothing.

[00:16:39] Eva Rothman: It's hard. I mean I'm trying to budget things, cutting back and just doing the basics, but it's not, it's like my whole life is turned upside down. I can't enjoy life because basically all I'm doing is paying bills, because I don't have any money to do any of the fun things that I used to do. It's kind of depressing. And uh, what can I do?

[00:17:07] Rabbi Lyle Rothman: And I would just add that I was just alerted to by actually one of my congregants that just in two weeks ago, in July, I think July 11th around that the Nassau County Police Department um, arrested a 79-year-old Staten Island person, man who scammed a, a woman from Long Island, I think Massapequa, out of $250,000, and same, same exact scam, gold bars, but came back I think almost two or three times as, as well. And so, you know, it, this is happening, it's so pervasive throughout our society, throughout our country, and, and people are dealing with this every single day, these scams.

[00:17:45] Bob: Indeed, Lyle is spot on. It is happening all over the country. And to find out just how pervasive these gold scams are, we talked to a gold dealer who has seen it firsthand. He's Michael Kakoullis who owns Portland Precious Metals & Coins in Portland, Oregon. He's had victims come into his store looking to purchase large amounts of gold. Here's just one example:

[00:18:11] Mike Kakoullis: It was maybe towards the end of 2024 or so when I got a phone call from somebody looking to purchase about $150,000 worth of gold bars. And I explained the process to him, and then maybe a few days later he calls and he wants to place the order but the order was for 175,000 now. So he...

[00:18:36] Bob: How unusual is a request like that?

[00:19:38] Mike Kakoullis: It's not every day, but it happens. We do large sales like that that are legitimate.

[00:18:41] Bob: Okay.

[00:18:43] Mike Kakoullis: So a few days later, the gentleman comes into the store and I asked him a few questions and he was saying all the reasons that normal people that are buying the gold would say, the reasons that they're buying it, so nothing was really out of the ordinary. So we locked in the order. I forget how many bars it was, 60 something gold bars. And we locked in the trade and then the next, he needed a day or so to get the funds to me. So I placed the order for him. And then maybe two days later I get a call from his bank saying that they can't send the money because they thought it was a fraud, which was correct. And so basically, we had to reverse the trade. The customer did end up losing a little bit of money because the price of gold went down and I had to, I'm obligated to purchase it at the price that I locked in. So the price went down and unfortunately; he had to pay the difference which was maybe four or five thousand dollars. But did save him from a much bigger loss.

[00:19:57] Bob: When you look back at the interactions you had with this person, was there any indication that something was unusual or did it seem like he was under pressure?

[00:20:03] Mike Kakoullis: Not at all. No, he seemed like he knew exactly what he was doing and after the fact it was, I thought to myself, wow, why, they, 'cause basically they told him he has to not tell anybody. So supposedly he got a call from some sheriff in Washington DC and that was the higher authority that he was talking to. And they told him he has to not tell anybody. His, basically the story was his Social Security Number was compromised and he needed to go buy these gold bars and give them to an agent and then they were going to deposit them in some new account under his, a new Social Security number that they were going to give him. And...

[00:20:53] Bob: But he didn't say any of that to you, right?

[00:20:55] Mike Kakoullis: No, not, well not till after. After the fact when the banker exposed everything then we fig--, then he told me once he didn't have to keep it secret anymore. And we found out about it, actually, there was another news story after we talked to the banker, my employee told me that he saw on the news some lady had already gotten taken for half a million dollars. And we saw the story and it was the same exact story, the same exact scam to a T. I ended up calling the news station that did the original story on that lady, and I told them, hey, we got the same exact story here.

[00:21:34] Bob: (sirens in background) Uh-huh, sure, but the fact that you know about two of these incidents, and I, I bet you went online and saw that there's, this is happening all over the country. So I'm very thankful that you've come forward.

[00:21:46] Bob: And, in fact, Mike has done more than that. He's helped law enforcement arrange a sting targeting gold bar criminals.

[00:21:54] Mike Kakoullis: So last week I received a call from the Gresham Police Department, some detectives over there, and they had a whole, the whole, a whole 'nother victim, and they randomly called me. They didn't know that I did the original interview with KGW. So basically another elder lady got taken for $250,000 just recently.

[00:22:21] Bob: Oh wow.

[00:22:23] Mike Kakoullis: Yeah. And then the detectives called me and they're, so they're basically setting up a sting. So we had them come to the shop and we made up a fake invoice with her name on it. Because they already delivered a quarter of a million dollars' worth of gold. So these people, they were trying, they're trying to get more, they're very greedy.

[00:22:44] Bob: Oh wow.

[00:22:46] Mike Kakoullis: So basically, we took, we, we laid out a bunch of gold and we actually tried to, we made it look like there was more than there was because we don’t keep that amount on hand. But we made it look like there was maybe three, because they were trying to get another half a million dollars on this second run.

[00:23:04] Bob: Wow.

[00:23:05] Mike Kakoullis: They wanted her to get. And we set it up and made it look like about three, $350,000 worth, and they took some pictures of it to send to them and we made them a fake invoice.

[00:23:18] Bob: A few days after our chat, Mike let us know that police did make an arrest using this sting, which we now know is in use around the country by investigators.

[00:23:30] Det. Sean Petty: I'm Detective Petty with Montgomery County Police, in Maryland. I'm with the Financial Crimes section. I've been on for 15 years now and our unit, we investigate complex financial crimes.

[00:23:44] Bob: And he and his team recently nabbed another gold bar courier on the East Coast.

[00:23:50] Det. Sean Petty: We actually just had a defendant that was sentenced a couple of weeks ago because...

[00:23:54] Bob: Good, congratulations.

[00:23:56] Det. Sean Petty: He was, thank you, thank you. He was from New York and in that particular case, we were able to conduct an undercover operation and lure the suspect to Montgomery County, Maryland, where they thought they were going to pick up a box of gold worth over $80,000, and it turned out it was not a box of real gold, it was actually a box of fake gold and in the box we were able to put a tracking device in it. And then with the assistance of the FBI Baltimore Field Office, we were able to track that suspect, not only with that tracker in the box, but also in person. We followed him from Maryland up to New York where we were able to effectuate an arrest up in New York. And from there, we were able to continue working the case.

[00:24:41] Bob: So this, this arrest began with a victim who is in the middle of a scam and at some point, realized that it's a scam and went to law enforcement without tipping off the criminal and that's how this sting was managed? Is that right?

[00:24:53] Det. Sean Petty: Absolutely, yeah. It was in the middle of the scam. They realized that they were being scammed, and once they contacted us, I was able to step in and we were able to keep the scammer on the hook to believe that we were going to supply additional gold bars and once I realized we needed some fake gold, I was able to reach out to the FBI, and we were able to coordinate efforts and to, to get some fake gold and to work an operation where we were able to successfully arrest the suspect who thought that he legitimately had gold bars, but they were actually fake gold. And...

[00:25:30] Bob: That's amazing to me. I'm picturing the fake gold department at the FBI.

[00:25:33] Det. Sean Petty: Yeah, it's something like that, but not quite. But these are certainly gold bars that, that look and felt real, because one of the things that we know is the scammers are, they're looking for confirmation throughout the process, and victims are directed to send pictures of the gold or send pictures of the cash and then the courier's directed to do the same. The scammer is definitely, they have their script, they know what they're looking for, they have their plan in place. And they're looking for anything that, that may seem like law enforcement is involved, and we had to make sure that we were as legitimate and realistic as possible. We had to create the fictitious documents that, that, that looked real to provide to the scammer. We had to put together the fake box of gold, made the gold look as real as possible, and hide a tracker in the box because we, we had a belief that maybe they're going to try to destroy the box, or maybe they're going to get rid of the box. Every step along the way, we had to think one or two steps ahead of the scammer, because we didn't quite know what they were going to do, but in using some of the things that we've seen them do in the past and trying to get ahead of them we were luckily able to stay a couple of steps ahead of them and be successful in this case.

[00:26:50] Bob: I would be nervous the whole time that suddenly the signal would go dark.

[00:26:54] Det. Sean Petty: We were certainly concerned, but luckily, we were physically watching as well. Not only did we have a tracker in, in the box, we were able to monitor in real time.

[00:27:03] Bob: Detective Perry didn't work on Eva's case, but he's seen too many similar cases.

[00:27:09] Det. Sean Petty: Yeah, so unfortunately, her story is so many others, other cases that we've heard here in the county as well as across the country of detectives and agents that I've been in touch with. It's very similar in nature. Victims are being contacted either by text message or phone call, or getting a pop-up on their computer and then they're directed to a series of individuals purporting to be from a tech company or a financial institution or with a federal agency, it could be the FBI, the DEA, the FTC, the FDIC. You name a three-letter federal agency and they're, the victims are told that they are being helped in these instances when in fact they are really being victimized by the scammers.

[00:27:58] Bob: It seems to us that there's been a new flurry of these stories that end up with someone walking into a shop and buying gold.

[00:28:06] Det. Sean Petty: Sure.

[00:28:07] Bob: Is that something that you are seeing more of lately?

[00:28:09] Det. Sean Petty: Sure, we have seen an increase in these cases over the past, I'd say a year and a half, two years and even up until today, we continue to see cases where victims are being contacted and are being directed to withdraw assets, either box up that cash or to go and purchase gold. But a lot of times they're, they're directed to a specific website and they're directed to have the gold shipped to their residence. With the prevalence of gold and the ability to access gold, whether it be in person at certain shops or online at certain retailers, the scammers have taken advantage of that access, and there, there's certainly nothing wrong with purchasing gold and I, I don't want people to get the impression that it's bad to buy gold. If that's something that individuals want to do, it, it is certainly a commodity that they can do and invest their money in, but the caveat is, when somebody tells you to do it and they direct you to hand it over to the to safeguard it, that's where the problem comes in. Legitimate law enforcement, we do not tell people you need to take your assets and convert it into gold or cryptocurrency or box it up and then hand it off to somebody else. That is not something that we, real legitimate law enforcement officers, do. That's not how we operate.

[00:29:32] Bob: It's full stop. If someone says, hand something off in a box to someone in a car, that's not law enforcement.

[00:29:38] Det. Sean Petty: Absolutely not. And a lot of times we're seeing individuals that are interacting with the victims, and the couriers. They, they're not dressed in law enforcement uniforms, they don't have badges, they don't have anything that would indicate that they are law enforcement, but the victims are believing that they are interacting with legitimate law enforcement couriers, and it's full-stop not legitimate. It is a scam all day, every day.

[00:30:08] Bob: If someone asks you to buy gold and put it in a box and hand it to a courier, that's a scam all day, every day. Full stop.

[00:30:19] Bob: It, one thing that, it's an image that I just can't get out of my head is this woman going to a gold shop she'd never been to before. She'd never bought gold before. And trying to figure out how to buy $20,000, $50,000 worth of gold. That just seems so striking and sad to me.

[00:30:35] Det. Sean Petty: It is, and unfortunately, we're seeing scammers who, they obviously do this for a living. This is what they do. They practice it. They have a script that they read from, and they are very convincing. And when they're telling victims, you are the victim of something, whether it be, your money's being used for child exploitation, or your money's being used to funnel drugs across the border, or we had one instance here in Montgomery County, Maryland where the victim was told that their money was being used to purchase missiles for Russia and their war and aggression against Ukraine. You know when victims hear that, when individuals hear that and they, they have a sense of duty and not wanting their money to be used in that nefarious way, they believed that they can be helped and that they're told to go take your money and transfer it into gold or go to the bank and take your money out the bank and box it up, and then hand it off to a courier who is going to safeguard it during the course of that investigation. And if they're believing that investigation is legitimate, they're wanting to help law enforcement and federal agents investigate crimes.

[00:31:44] Bob: And I've done a few of these stories, but it strikes me a really important part of this is the shock value of someone saying, your bank account is being used for pedophilia or oh my goodness, your bank account is being used to buy missiles. So that, that seems like it puts people in a state, right?

[00:31:58] Det. Sean Petty: It, it really does. It, one, it's the shock factor when you hear that, and all these individuals that they are elderly and they may not fully think through the process right away. They are told, don't communicate with other people, don't tell anybody about the existence of this investigation. They're told to act quickly. You have to move quickly or else the bad guys are going to get your money and they're going to take all of your assets from you, and with all of that, that level of urgency, that, that, that definitely goes towards the victim's psyche, and they believe they need to act quickly and they may not think through the process.

[00:32:36] Bob: But they think they're doing the right thing, right?

[00:32:38] Det. Sean Petty: They absolutely think that they're doing the right thing. In some, in some instances they're provided with paperwork that may provide a case number related to an incident, they're provided legitimate looking documents that are purported to be from a federal agency or some other entity, so yes, the victims absolutely believe that they are doing the right thing by helping with a federal investigation or another type of criminal investigation when in fact they are actually talking to the scammers, the ones that are actually perpetrating the crime against the victim.

[00:33:14] Bob: Is there something special about gold, particularly right now. Gold's not new, but why do you think there's a resurgence of these crimes involving gold recently?

[00:33:23] Det. Sean Petty: Yeah, you're right. Gold, gold is certainly not new. But the inter--, interesting thing about gold is that no matter where you go in the world, gold is valuable. You can go anywhere in the US and you put a gold bar in front of somebody, and they're going to recognize it as gold. You go anywhere overseas to the Middle East or to countries like India, they are going to know what gold is. And gold has a value regardless of where you take it. We think that the reason that these have become most prevalent lately is because gold has increased in value exponentially over the past year and a half, two years. It continues to rise. I think last when I checked it, maybe a couple of weeks ago, it was hovering right around 78, 80,000 dollars for one kilo. And the size of a kilo, it's the size of a cellphone. The prevalence of it, the availability of it, the portability of it, it just makes it easy for scammers. And it is the biggest bang for their buck. We used to see gift cards being the prime targets. Scammers would contact victims and say, you need to go purchase three gift cards worth $500 apiece. You figure how many gift cards is somebody going to be able to get that's going to equate to one gold bar? It just, it doesn't make sense from the scammer's perspective. So from the scammer's perspective, why not go towards an asset that you're going to get the biggest bang for your buck, and if you, if the scammer's telling the victim to go purchase three or four gold bars, they're easily purchasing several hundred thousand dollars' worth of gold bars at a time. And so with that, they're able to get the most from that interaction, and that's all the scammer's looking for. They are looking for how can they extract the most money from somebody as quick as possible? And as soon as they've extracted as much as they can, and typically all that they have, all the victim has, the scammer goes completely ghosts on them, and they, they cease any and all contact because there's nothing else to gain from the victim.

[00:35:27] Bob: And as you mentioned, gold is very portable and it's worth something everywhere, right?

[00:35:32] Det. Sean Petty: Correct, yeah, it absolutely is.

[00:35:34] Bob: I really like the way you put that, that essentially a smartphone's, a smartphone sized bar of gold is worth just a bit shy of $100,000. That's remarkable.

[00:35:44] Det. Sean Petty: It is, and with the prices now, I, I don't necessarily foresee them decreasing anytime soon, but at any point in time, it's going to be valuable, and it's going to be easier to transport those gold bars than let, let's say a duffle bag of cash. So why not from the scammer's perspective? Why not go after gold?

[00:36:07] Bob: The way you put it, it sounds like gold is even more anonymous than bitcoin.

[00:36:11] Det. Sean Petty: To, to a certain extent, it actually is. With bitcoin, at least we have the ability to trace it depending upon how it's transmitted and if it goes to a cold, without getting too much into the weeds, whether it goes to a cold wallet or a hot wallet, it, it may be connected to a financial institution at some point. At least we have something to investigate on that end. With gold, once it's melted down, it can be molded into any object, it can be molded into a car part, it could be transformed into a piece of jewelry that doesn't have a serial number. And how would we be able to differentiate that from anything else that is gold? It just, it's impossible. We're seeing victims lose anywhere from 20--, $30,000 at a time upwards to two or three million over the course of an interaction with a scam group. It really does strike a chord.

[00:37:03] Bob: And in part because losses are so high, law enforcement is taking extreme measures like setting up stings with fake gold bars to try to stem the tide of this crime.

[00:37:17] Bob: I do want to get that story out because one of the things about this crime that has struck me is, and I've been doing cybercrime stories for 30 years, and the move has always been away from any kind of real-world interaction, right? It's safe if you're only communicating online, and here are these people sending human beings to homes that probably have Ring cameras, right?

[00:37:35] Det. Sean Petty: Correct, yeah.

[00:37:36] Bob: And so it seems so brazen to me that they're willing to do that as if they feel like they're above the law. Maybe the word needs to get out that they're not.

[00:37:42] Det. Sean Petty: Well and one, that's one of the things that we've certainly tried to impress upon not only the general public, the scammers as well. We've been trying to let them know, hey, if you come to Montgomery County, we're going to catch you, and we're going to hold you accountable. But you're right in that they have become more brazen in their operations. They have become certainly more willing to risk being, it, more willing to interact in person with the victims. And from some of the things that we have been able to uncover is, they are not concerned because they know if they flood the market with couriers picking up these boxes of gold bars and boxes of cash, they know that they can flip the market and that law enforcement is not going to be able to catch each and every one of them each and every time. And so it's a risk/reward for them. If they can push out 10 people in one day, if they get one of them that gets caught or two of them that gets caught, it's the cost of doing business. And having talked to scammers, literally myself talked to scammers who are based in, in other countries, they do not care. They really do not care that law enforcement is involved. They are willing to do it because they know if they can get two- or three-hundred-thousand dollars from any victim, that's worth the risk, that is absolutely worth it to them.

[00:39:11] Bob: And the risk is, it's on the courier, right, who's a low-level person in the operation.

[00:39:15] Det. Sean Petty: Correct, and they know that right now we are absolutely arresting the couriers, but they are soon to find out that not only have we started arresting couriers, but we are actively involved in identifying them overseas, and we are absolutely going to go after them as well. Yeah,

[00:39:33] Bob: And also, let's get the message out to criminals that those gold bars you're picking up might actually have a tracer in them.

[00:39:40] Det. Sean Petty: They absolutely may have a tracker in them, and you never know who's watching you. No matter how careful you may be at watching your back or doing countersurveillance, we are much better at you than this, and we will absolutely find you and catch you.

[00:39:55] Bob: So one thing that I can't stop thinking about is the responsibility that these gold dealers might have in this situation. So if I run a shop, maybe it's a pawn shop, or maybe it's, here it's a precious metal shop, and an elderly person comes in who I've never seen before and they suddenly frantically want to buy $100,000 worth of gold, it strikes me that they bear a little responsibility to understand what's going on. No?

[00:40:17] Det. Sean Petty: So it's a little bit of a, an interesting idea. The challenge is that's a legitimate business, and there is, perfectly fine to sell gold, to sell silver. There, there is nothing wrong. And it's the same with the financial institutions. A lot of times we see the scammers have convinced the victims that they are the victim of some type of crime and they need to be helped, and they give the victims a script to go into the bank, to go into the gold shop, and to provide to either the merchant or to provide to the bank teller. And in many instances, the victim may be asked questions about, are you being told to purchase gold bars? Are you being directed to withdraw cash from your bank account? Are you being told to hand it over to another individual for safekeeping? And so even when confronted with those questions, the victim is, they, they have been given a story to tell and they tell that story to either the teller or to the merchant at the gold bar shop. And even in those instances where it may be believed that the victim is being victimized, if they're being told, now if the victim is telling the merchant or the teller, no, I'm not being directed to withdraw this cash. No, I've not been directed by anybody to go purchase gold and to hand it off. What are they to do? What is the teller to believe? It's, it is the victim's money in their account, that is certainly the victim's money and they can purchase gold bars if they want, and it really puts them in a position where they have to ask questions, but if those questions are answered appropriately by the victim, then they're going to receive that withdrawal that they asked for, they're going to receive the product that they wanted to purchase. Purchasing gold is certainly not illegal in the US and you can certainly order it online or purchase it in person, and that is completely legal.

[00:42:17] Bob: Mike, who's now got plenty of experience spotting this crime has some advice for other precious metals dealers.

[00:42:26] Bob: Since this is happening so much in stores that sell or trade in precious metals are caught up in the middle, is there anything that you might want to say to other store owners that they, they should look for or be aware of?

[00:42:40] Mike Kakoullis: Be aware of elder folks placing large orders just out of the blue. And in fact, just this last week we got a phone call from a lady who was inquiring about rou--, roughly two or three hundred thousand worth of gold purchase, and she sound--, she just called and she sounded like she was older on the phone. So I actually asked her, "Is somebody putting you up to this?" to because it's just, it's becoming so rampant that I asked her, "Hey, is somebody putting you up to making this purchase? Some government agency?" She said, "No." But then she never really called me back or came to buy any gold. You never know how convincing those people are to let you know, 'cause I was basically trying to tell her about the scam if that was the case. But and if she was, but she denied it, and I don't know if she was getting scammed. But she hasn't come to buy the gold, so I don't know if she went somewhere else or maybe it wasn't a scam and she, she's just not, I'm just reading into it. But now, yeah, I have questioned actually a couple customers that have called me.

[00:43:57] Bob: On behalf of everyone, I want to thank you for doing that. It, it took us years to persuade retailers to, to question people when they suddenly showed up to buy 27 $500 gift cards, so you're doing that on your own. I think that's great.

[00:44:10] Mike Kakoullis: Yeah, well I am the owner and I pretty much oversee most transactions, so I don't want to see anybody get ripped off. I'll, the amount I'll make on that isn't a large amount anyway. We make very small margins, but yeah, when you're 80 years old, that's your life's work they're taking. You can't, if I knew when I was 80 that everything I'm working for today was going to be stolen in a flash, I'd rather not work, just enjoy life, and I'll end up with no money at the end anyway. It's really messed up.

[00:44:45] Bob: Yeah, these stories are really sad.

[00:44:46] Mike Kakoullis: Yeah.

[00:44:47] Bob: Like in--, instead of a life visiting the grandkids, they're living on Social Security, going to food banks.

[00:44:51] Mike Kakoullis: Yeah, if you worked your whole life, that's essentially, they stole your life's labor.

[00:44:57] Bob: And onto some basic investing advice here; no one should wake up and buy a pile of gold with most of their retirement savings for any reason.

[00:45:07] Mike Kakoullis: 'Cause most people dip their toe in the water, they'll buy a little bit to start and feel it out. Maybe average their cost with multiple purchases.

[00:45:15] Bob: That's just good investment practice, the dollar cost average over the course of a bit of time, right?

[00:45:20] Mike Kakoullis: Yeah, most people don't just empty their bank account, especially gold's pretty close to an all-time high. You want a dollar/cost average. You don't want to go all in with your life savings all at once, especially after the gold price has gone up quite a bit. You don't want to, first of all, make your own decisions. You don't want to buy gold because a gold salesman told you you need to buy gold. You don't need to buy gold because other people told you. But also, I don't know if this is even relevant to what we're talking about. And there's a lot of scams; there's a very large amount of scams.

[00:45:59] Bob: We are so grateful to Eva and her nephew Lyle for speaking to us about all that's happened to their family. She tries to keep a positive attitude about things, and she's glad to have a rabbi in the family.

[00:46:13] Bob: Did, did you know he was going to be a rabbi when he was young?

[00:46:16] Eva Rothman: I don't know, I think I remember something when you, didn't you dress up like Tevye and you'd sing, "If I Were a Rich Man?"

[00:46:22] Rabbi Lyle Rothman: There were, the irony in singing, "If I Were a Rich Man," and there we're talking about the loss of $700,000. But, you know what? That's very interesting, because yes, I did use to love Fiddler on the Roof and singing "If I Were a Rich Man," but I think if I could be rabbinic for a second, the, the irony is that one of the messages in the Broadway show is that you can have nothing but still find those moments for levity and for joy even when, even in, when you're at your lowest low. So I don't know, maybe that's the thing we have to look towards at the moment.

[00:46:57] Eva Rothman: Yeah.

[00:47:00] Bob: But there's no sugar-coating Eva's situation. Things are very hard.

[00:47:07] Bob: How are you doing? You've had to do things like turn to food banks, right, which you never thought you'd have to do, right?

[00:47:12] Eva Rothman: Right, yeah, I mean I get food stamps, so that helps out a lot. So I, you know, that helps with food, putting food on the table. It's a pretty good amount. And you know, if I need anything in addition, I, I have a food pantry that I deal with, but not, not, not that often because I don't really need it because the food stamps help out.

[00:47:37] Rabbi Lyle Rothman: You know my aunt always is there with a, with a quick joke or something that'd be like, I guess it could be worse. But the reality is, I don't actually think it can be worse. This is literally having everything ripped out from under you without really a support apparatus. And so as much as she tried to, to sort of sugar coat or hide her emotions and her feelings, all these months, a year later, a year plus later, we see the effects of it, and I, I, my, my parents, my sister, my husband, my brother-in-law are deeply, and our extended family are deeply concerned and there's only so much that we can do, but we are, it keeps us up at night. And that is the truth. And that's the, that's the thing that, as a rabbi, as a nephew, as a family member, I don't have answers to, and I wish I did.

[00:48:30] Rabbi Lyle Rothman: Eva, what do you hope that people take away from hearing your story?

[00:48:33] Eva Rothman: Mainly that they don't let it happen to them and they're, they just, just be aware of things that if you're not sure of something, then don't, don't pursue it or go along with if it, even if it sounds good, there's always a catch to that. Just don't fall into the same trap. And then my other issue is what I would like to get away, get out of this, maybe by some miracle I could get something back in the future, 'cause like I said, this detective is working on it and he's been making arrests, and maybe they will find the person and they will ask for, if they could ask for restitution or whatever. You gave me some wording that there is a possibility I could, I, I don't think I'll ever get the full amount, but I keep hoping that maybe something good will come out of this.

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[00:49:34] Bob: For The Perfect Scam, I am Bob Sullivan.

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[00:49:45] Bob: If you have been targeted by a scam or fraud, you're not alone. Call the AARP Fraud Watch Network Helpline at 877-908-3360. Their trained fraud specialists can provide you with free support and guidance on what to do next. To learn more about the Fraud Watch Network volunteers and the fraud survivors they've helped, check out the new video series, Fraud Wars, on AARP's YouTube channel. Our email address at The Perfect Scam is: theperfectscampodcast@aarp.org, and we want to hear from you. If you've been the victim of a scam or you know someone who has, and you'd like us to tell their story, write to us. That address again is: theperfectscampodcast@aarp.org. Thank you to our team of scambusters; Associate Producer, Annalea Embree; Researcher, Becky Dodson; Executive Producer, Julie Getz; and our Audio Engineer and Sound Designer, Julio Gonzalez. Be sure to find us on Apple Podcasts, Spotify, or wherever you listen to podcasts. For AARP's The Perfect Scam, I'm Bob Sullivan.

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