Retail Precious Metals and Compliance

Some firms may have special interests when it comes to reconciling informational and marketing copy with compliance considerations. Because the retail precious metals industry currently is not subject to formal oversight by either state or federal securities regulators or the Commodity Futures Trading Commission (CFTC), retail dealers might conclude they exist altogether outside the reach of regulatory agencies. That is not necessarily true.

For starters, there is no product or service sold in the U.S. that does not come under the jurisdiction of the Federal Trade Commission (FTC) as well as relevant state attorneys general. Additionally, as recent enforcement actions suggest, both state securities regulators and the CFTC appear to be gaining a legal foothold in the oversight of retail precious metals companies that make “actual delivery” of metals products to customers in addition to firms that deal only in futures contracts.    

These agencies may not have official regulatory jurisdiction, per se, over retail precious metals dealers at the present time. However, their authority to pursue enforcement actions still can create headaches for retail dealers.

Firms that wish to place a premium on compliance considerations in their copy may find it helpful to retain a writer capable of conveying an appropriate compliance temperament throughout the message. In addition to creating information and marketing materials for precious metals companies that have elected to place a particular emphasis on compliance, I have extensive experience working directly in compliance for registered investment advisers (RIAs) and broker-dealers. This professional background could be useful to those firms seeking to speak authoritatively about precious metals while doing so from a posture that diminishes the chances they might run afoul of regulators in their public presentations.