*NOTE:* If this communication should be sent to another contact in your organization, please send the updated contact information to [email protected] <[email protected]> and indicate whether this is an additional or replacement contact. Thank you.

*FOR IMMEDIATE RELEASE FROM
**THE* *WASHINGTON DEPARTMENT OF FINANCIAL INSTITUTIONS*

*Wednesday, Oct. 25, 2023*

*CONTACT*:    
Lyn Peters, DFI Director of Communication
PH 360-902-8731, [email protected]

Bill Beatty, Director Division of Securities
PH 360-902-8760, [email protected]

*DFI, CFTC, AND 29 STATE REGULATORS REACH SETTLEMENT WITH
**SAFEGUARD METALS IN $68 MILLION FRAUD TARGETING ELDERLY ADULTS*

*"Customer restitution and civil money penalties to be determined in next phase of litigation"*

OLYMPIA – The Washington State Department of Financial Institutions (DFI) today announced that, in partnership with the U.S. Commodity Futures Trading Commission (CFTC) and 29 other state regulators, the parties have reached a settlement with precious metals dealer Safeguard Metals, LLC and Jeffrey Ikahn in a federal lawsuit [ [link removed] ] filed in February 2022, in the United States District Court for the Central District of California. The lawsuit alleged that Safeguard and Ikahn engaged in a $68 million fraudulent scheme that targeted the elderly. 

A key finding in the Consent Order is that between October 2017 and July 2021, Safeguard and Ikahn deceived more than 450 customers nationwide into purchasing precious metals through false and misleading statements, including misrepresenting Safeguard’s and Ikahn’s credentials and the risk and safety of customer investments in traditional retirement accounts.

“Safeguard Metals engaged in fraudulent and deceptive practices to solicit millions of dollars, primarily from elderly and retirement-aged individuals for profit. As a result, customers suffered substantial losses on their retirement investments,” DFI Director Charlie Clark said.  “By joining this settlement, in partnership with the CFTC and other state regulators, DFI continues its efforts to protect consumers by holding bad actors in the precious metals industry accountable for their actions.”

The order also finds that the defendants charged an average markup of 51 to 71 percent on the precious metals, which was substantially more than the amounts the defendants represented in Safeguard Metals’ customer agreements as “operating margins” of 23 to 42 percent. Safeguard Metals steered more than 97 percent of its sales from mostly inexperienced investors into overpriced silver coins which had significantly higher markups than gold coins and generated for Safeguard approximately $66 million of the $68 million fraudulently solicited from customers.

The defendants’ consent to the use of the consent order’s findings and conclusions in this action and any subsequent actions between the parties, but otherwise, neither admit nor deny the findings.

As part of the court approved settlement, Safeguard and Ikahn agreed to a permanent injunction that enjoins them from violating several federal and state laws including laws that prohibit commodities fraud, securities and investment adviser fraud, and providing unlicensed investment advice. In addition, Ikahn agreed to a federal commodity trading ban. In the next phase of the litigation, the appropriate amount of customer restitution and civil monetary penalties will be determined.

Safeguard and Ikahn also agreed to settle a federal lawsuit filed by the Securities and Exchange Commission (SEC) alleging violations of federal Securities Laws. DFI wishes to thank the CFTC, other state regulators, and the SEC for their assistance in this action.

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*About DFI* ▪ www.dfi.wa.gov [ [link removed] ] ▪ 360-902-8700 ▪ 877-RINGDFI (746-4334)
The Washington State Department of Financial Institutions regulates a variety of financial service providers such as banks, credit unions, mortgage brokers, consumer loan companies, payday lenders and securities brokers and dealers. The department also works to improve financial education throughout Washington through its outreach programs and online clearinghouse www.dfi.wa.gov/financial-education [ [link removed] ]. In addition to posting information about licensees and administrative actions, DFI uses the Web and social media to provide financial education information: www.facebook.com/wadfi ■ [ [link removed] ] ■ www.instagram.com/wastatedfi/ [ [link removed] ] ■ www.linkedin.com/company/state-of-washington-department-of-financial-institutions/ [ [link removed] ]  ■ twitter.com/dficonsumers [ [link removed] ] ■ [link removed] ■ [link removed] ■ www.homeownership.wa.gov [ [link removed] ]  

*About the Division of Securities *▪ www.dfi.wa.gov/sd [ [link removed] ] ▪ 360-902-8760 ▪ 877-746-4334, x 8760
The Division of Securities regulates securities investments, franchises, business opportunities, and off-exchange commodities sold in Washington and the firms and individuals that sell these products or provide investment advice. The Division handles complaints, conducts investigations, and takes appropriate enforcement actions to protect investors and combat fraud.

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