Proof that Gold ETFs Are a Fraud

Written By Brian Hicks

Posted November 19, 2011

Over the course of the last eight years — since the creation of the precious metals ETFs — I have maintained and repeatedly stated my opinion that these gold and silver financial products were dangerous and a FRAUD.

I have also stated that those who hold these precious metals ETFs or certificate programs would sooner or later find out just how fraudulent these products are, and not reap the full benefits of rising gold or silver prices. 

Several years ago, during the 2008 meltdown, the Perth Mint certificate program was exposed for not holding the gold they told their customers was backed by the Western Australian government.

And now, once again, precious metals fraud is in the media — this time with the ETFs and the MF Global situation.

One of the victims of this scandal, popular trends forecaster Gerald Celente, joined Alex Jones on “Infowars Nightly News” to detail how a six-figure sum was looted from his gold futures account, which, unbeknownst to Celente, was being held under the auspices of an MF Global subsidy.

As the Financial Times reported, the hundreds of millions in looted funds from customers’ accounts later “turned up at JPMorgan Chase, the failed broker-dealer’s custody bank.”

What a surprise (NOT) that the name JP Morgan Chase would be at the epicenter of this latest criminal behavior!

Despite Mr. Celente’s account being fully funded, Celente was hit by a margin call as Chapter 11 trustees stepped in to take control of his funds, leaving his account empty… and thereby closing his positions and preventing him from taking physical delivery of his gold which was due in December.

When Celente rejected demands to transfer more money into the account, it was hastily closed.

Those words above in bold tell the real story, because they owed gold they didn’t have. So they resorted to theft of customers accounts. In my opinion, this is criminal behavior, pure and simple.

It’s horrifying.

Ann Barnhardt, a commercial hedge broker specializing in cattle and agriculture futures, eloquently explains the MF Global situation (she’s also getting a ton of publicity for closing down her operations):

The reason for my decision to pull the plug was excruciatingly simple: I could no longer tell my clients that their monies and positions were safe in the futures and options markets – because they are not. And this goes not just for my clients, but for every futures and options account in the United States. The entire system has been utterly destroyed by the MF Global collapse. Given this sad reality, I could not in good conscience take one more step as a commodity broker, soliciting trades that I knew were unsafe or holding funds that I knew to be in jeopardy. 

Everything changed just a few short weeks ago. A firm, led by a crony of the Obama regime, stole all of the non-margined cash held by customers of his firm. Let’s not sugar-coat this or make this crime seem “complex” and “abstract” by drowning ourselves in six-dollar words and uber-technical jargon. Jon Corzine STOLE the customer cash at MF Global.

What was a surprise was the reaction of the exchanges and regulators. Their reaction has been to take a bad situation and make it orders of magnitude worse. Specifically, they froze customers out of their accounts WHILE THE MARKETS CONTINUED TO TRADE, refusing to even allow them to liquidate. This is unfathomable. The risk exposure precedent that has been set is completely intolerable and has destroyed the entire industry paradigm. No informed person can continue to engage these markets, and no moral person can continue to broker or facilitate customer engagement in what is now a massive game of Russian Roulette.

I have learned over the last week that MF Global is almost certainly the mere tip of the iceberg. There is massive industry-wide exposure to European sovereign junk debt. While other firms may not be as heavily leveraged as Corzine had MFG leveraged, and it is now thought that MFG’s leverage may have been in excess of 100:1…

Read that last sentence very closely.

If it’s true that MFG was leveraged 100:1, that’s suicide. It also means this crisis isn’t over by a long shot.

Back to Celente…

Speaking with Alex Jones, Celente expressed his fury at the move, labeling it an example of “economic martial law,” and speculating that the real reason for the looting was because the broker never had the gold and silver to deliver in the first place.

Celente encouraged Americans to cash out of all gold ETFs and withdraw their funds from the bank because “they are going to steal all our money.”
The trends forecaster savaged MF Global CEO Jon Corzine, labeling him a “cheap S.O.B.” who was responsible for the collapse because of his using customer funds to bet on losing European bonds.

“How come he’s not in jail, because he’s one of the white shoe boys from the Goldman Sachs crowd,” Celente fumed, going so far as to say Corzine “should have died” in his recent car accident.

Celente said that he had sufficient funds stored in a safe place that could not be looted, and that if anyone did try to steal them and threaten his life, he wouldn’t hesitate to “blow their brains out.”

Celente reiterated his plea to Americans to withdraw all their money from the banks and leave only operating capital in their accounts, warning that “the merger of state and corporate powers” has brought “fascism” to America.

You must take physical possession of your gold and silver if you want to have your assets protected from collapsing government fiat currencies and government sanctioned corporate theft like the MF Global example.

Time is running out, folks. Make your necessary arrangements while you still can.


Greg McCoach
Editor, Wealth Daily 

P.S. In the coming weeks, I’ll be releasing my full report on my August trip to the Yukon, where a historic gold rush is occurring as you read this. This is real gold — not an illusion like a gold or silver ETF. More ideas on places to invest below…

Options Made Easy: The Only Way to Trade in a Recession
It’s won’t be easy to walk away from this recession with gains in your bank account… but that’s precisely what Ian Cooper’s readers are doing right now. Imagine trading with a system that delivers 68% or more in less than a month. Find out how they’re doing it with Ian’s proven system.

The Crisis that will Dwarf the Debt and Financial Crisis: And How You Can Profit
Peak Oil is here. And current oil prices are very likely the lowest we will ever see. But you can nail down easy triple-digit gains — 153% or more — from the biggest American oil discovery in 50 years: the Bakken. Don’t wait to get into these shale stocks before you can no longer afford them…

Pocket Full of Euro Gold: How Gold and Oil Will Fare against the Dollar and Euro
This is what a Transatlantic currency war will do to the price of gold and oil.

IEA Says Conventional Oil Has Peaked: $1.5 Trillion Per Year Needed to Combat Peak Oil
All these factors are combining to make a bullish oil investment scenario. I’ve been saying as much for a few months now.

Electric Car Investment Opportunities: Chevy Volt Bursts into Flames!
Editor Jeff Siegel discusses the future of electric cars.

Gold and Silver Price Rally Imminent: Too Much Money, Not Enough Gold
Gold may surge, but you should buy silver now…

Shale Oil vs. Oil Shale: Blueprint for an Oil Fortune
Energy and Capital editor Keith Kohl clears the confusion over the differences between shale oil and oil shale. Plus a blueprint for the future of oil investing.

The Next Mega-Trend in Housing: This Trillion-Dollar Boom Has Just Begun
Editor Steve Christ discusses the next mega-trend in the housing market.

Anadarko Petroleum’s Historic Oil Discovery: One of the Largest Finds in the World
Analyst Ian Cooper takes a look at Anadarko Petroleum’s latest billion-barrel oil find in the Niobrara Shale in the Midwest United States.

Goldmine of the Future: Possibly the Largest Metals Mine on the Planet
When I recently discovered that some of the wealthiest and most successful resource investors in North America were putting their own money into this project, I hopped on a plane with Nick Hodge and Andrew Mickey to see it firsthand.

Keystone XL Pipeline Opportunities: 3 Stocks to Soar on Oil Pipeline Delays
Editor Jeff Siegel discusses the impact of delays on the Keystone XL pipeline.

Rare Earth Rebirth: China Cuts Supply, U.S. to Create Strategic Reserve
With less than a handful of rare earth mines in operation outside of China, continued price fixing games, and the growing use of handheld electronics, any company with access to supply is going to fetch a premium market price.

Angel Publishing Investor Club Discord - Chat Now

Brian Hicks Premium