Thu November 17, 2011
Austin-based Coin Marketer to Pay $5 Million in Restitution
An Austin-based coin marketer agreed to pay out at total of $5 million in restitution to customers to settle a lawsuit filed by the Texas Attorney General's office. State attorneys charged that U.S. Money Reserve making of false claims in their commercials, in violation of the Texas Deceptive Trade Practices Act.
The marketing company came under scrutiny after a number of customers complained that their commemorative coins were not increasing in value as quickly as promised. Customers would call in response to television advertisements for bullion coins, but would be encouraged by sales personnel to purchase more expensive commemorative coins instead. State investigators claim that the sales team would promise that these coins would retain and increase their value "more effectively" than bullion coins, but the coins were sold at such a high price that customers wouldn't see any remarkable increase in value for several years.
Under the agreement finalized this week, the firm has agreed to fully restructure their sales practices to comply with the Texas Deceptive Trade Practices Act.