DFPI Secures Over $51 million After a Nationwide Scheme Targets the Elderly

What You Need to Know: A precious metals dealer who targeted the retirement accounts of elderly people must pay over $51 million for its high-pressure, deceptive sales tactics.

SACRAMENTO - The California Department of Financial Protection and Innovation (DFPI) announced today that after taking legal action, a California-based company, Safeguard Metals LLC (Safeguard Metals), and its owner, Jeffrey Santulan, also known as Jeffrey Ikahn or Jeffrey Hill (Santulan), has been ordered to pay more than $51 million to those they defrauded and in costly penalties.

DFPI, in coordination with the federal Commodity Futures Trading Commission (CFTC) and 29 other state regulators, brought this action to assist the victims and protect consumers from predatory activities. This final judgmentfollows an October 2023 court finding that Safeguard Metals used aggressive sales tactics to coerce more than 450 elderly people nationwide to liquidate their retirement accounts to purchase overpriced metals and coins. This violates federal and state commodities and security laws.

"Safeguard Metals exploited the trust of hundreds of seniors and retirement savers through high-pressure, deceptive sales tactics," said DFPI Commissioner KC Mohseni. "Today's judgment demonstrates that the DFPI, working alongside our federal and state partners, will hold accountable those who prey on Californians' hard-earned savings."

The company promoted its products on social media platforms and on financial websites. It used false and misleading statements to misrepresent its credentials, including how long it had been in business.

This month's court order to pay more than $25.5 million each in restitution and penalties is the culmination of an extended legal action against the fraudulent metal dealer. Previously, the court found that:

• Safeguard Metals charged markups ranging from 51 to 71 percent on the precious metals - far higher than the amounts represented in their customer agreements. The company also directed over 97 percent of its sales, primarily from inexperienced investors, into overpriced silver coins. In total, sales of gold and silver coins generated approximately $67 million for Safeguard, including $25.5 million in markup fees charged to victims.
• In California, Santulan was barred from any position of employment, management, or control of any investment adviser, broker-dealer, or commodity adviser. Further, Santulan agreed to orders barring him from the securities industry in other states, as well as a ban on federal commodity trading.
• Safeguard Metals and Santulan were permanently enjoined from violating several federal and state laws.

The DFPI encourages consumers who have experienced fraudulent practices in connection with investment advisory services or the sale of commodities, or any unfair, unlawful, deceptive, and abusive practices from a financial service provider, to submit a complaint with the DFPI online (dfpi.ca.gov/submit-a-complaint) or call toll-free at (866) 275-2677.

The Department of Financial Protection and Innovation protects consumers, regulates financial services, and fosters responsible innovation. DFPI protects consumers by establishing and enforcing financial regulations that promote transparency and accountability. We empower all Californians to access a fair and equitable financial marketplace through education and preventing potential risks, fraud, and abuse. Learn more at dfpi.ca.gov.