CFTC, 30 state regulators announce consent order against Safeguard Metals for $68M fraud
The Commodity Futures Trading Commission (CFTC) and 30 state securities regulatory agencies that are members of the North American Securities Administrators Association (NASAA) today announced entry of a consent order in the U.S. District Court for the Central District of California against Safeguard Metals LLC and Jeffrey Ikahn (formerly Jeffrey Santulan a/k/a Jeffrey Hill) finding them liable for operating a nationwide $68 million fraudulent scheme, involving the sale of fraudulently overpriced silver coins that targeted elderly and retirement-aged people.
The order finds Safeguard Metals and Ikahn executed a nationwide fraud, from approximately October 2017 through at least July 2021, in which the defendants solicited and received approximately $68 million in investor funds. The majority of the funds were retirement savings solicited from approximately 450 people to purchase precious metals, primarily silver coins.
The order finds the defendants’ fraudulent scheme involved deceiving customers into purchasing precious metals through false and misleading statements, including about the risk and safety of their investments in traditional retirement accounts.
The defendants also deceived customers into purchasing silver coins at prices that included grossly inflated price markups that vastly exceeded the price markups disclosed to customers.These excessive markups caused customers an immediate and substantial loss on their investment.
Also, to disguise their fraudulent scheme, the defendants misled their customers about the true value of the silver coins they purchased.
In addition to finding the defendants liable for fraud, the order enjoins them from future violations of the Commodity Exchange Act (CEA) and CFTC regulations, as charged; future violations of state laws and regulations, as charged; and from trading or registering with the CFTC and the states in this action. The order further reserves determination of the amounts of restitution, disgorgement, and civil monetary penalty for future decision by the court or by consent.
