Congressman Anthony Weiner, D-N.Y., announced Thursday that a Sept. 23 hearing has been scheduled in the House Subcommittee on Commerce, Trade and Consumer Protection to discuss "legislation that would regulate gold-selling companies, an industry who's [sic] relentless advertising is now staple of cable television."
According to a press release from Rep. Weiner's office, invitations to the hearing have been sent to representatives of Goldline International (full disclosure: Goldline advertises on this site), the Federal Trade Commission, the Consumers Union and other potential witnesses, "including former Goldline employees."
Earlier this summer, Rep. Weiner published a report investigating Goldline International's business practices. According to Weiner, Goldine "uses aggressive sales tactics and conservative spokespeople like Fox News’ Glenn Beck to sell overpriced gold coins."
Rep. Weiner, who sits on the subcommittee, is proposing legislation that would force companies such as Goldline to "fully disclose their dishonest business practices." From the Congressman's press release:
Under Rep. Weiner’s bill, companies like Goldline would be required to disclose the reasonable resale value of items being sold and would no longer be able to hide behind false promises of profitability.
“The frenzied marketplace has become rife with scam artists ready and willing to take advantage of consumers. The sole purpose of this proposed legislation is to protect consumers from being ripped off.”
Among Weiner's accusations, the congressman claims Goldline "grossly overcharges for their coins"; "falsely claims to offer 'good' investments"; "plays off public fears of government takeover" and has "formed an unholy alliance with conservative pundits to drive a false narrative."
Goldline employs several conservative pundits to act as shills for its’ precious metal business, including Glenn Beck, Mike Huckabee, Laura Ingraham, and Fred Thompson. By drumming up public fears during financially uncertain times, conservative pundits are able to drive a false narrative. Glenn Beck for example has dedicated entire segments of his program to explaining why the U.S. money supply is destined for hyperinflation with Barack Obama as president. He will often promote the purchase of gold as the only safe investment alternative for consumers who want to safeguard their livelihoods. When the show cuts to commercial break, viewers are treated to an advertisement from Goldline.
“Under this proposed legislation, gold dealers will have a much harder time preying upon the nest eggs of vulnerable consumers,” said Weiner. “It’s shameful that companies like Goldline are able to rip off consumers, use misleading and possibly illegal sales tactics, and deliberately manipulate public fears to sell gold coins at inflated prices.”
At FutureofCapitalism.com, Ira Stoll challenges Weiner's push for regulation, hinting that it is one way to try and erode conservative radio and television hosts' popularity:
Are Mr. Weiner and Chairman Bernanke also going to agree to print on every dollar the reasonable expectation that its value will be eroded by inflation?
Gold investors (or speculators) are already punished by the federal government by having their investment, even in a gold exchange-traded-fund, taxed at the higher rates that apply to collectibles rather than long term capital gains. ...
"The whole situation is amazing," Stoll writes. "If Mr. Weiner really wants to calm fears about hyperinflation, the last way to do it is to have a government hearing cracking down on the people warning of it."
Beck (full disclosure: he owns this site) has commented on Weiner's allegations in the past calling them false, and has stood behind Goldline International's "A+" rating from the Better Business Bureau as a customer himself.
In addition, Goldline's Executive Vice President Scott Carter calls Weiner's claims "inaccurate" and has weighed in on the debate in a letter published on ABCNews.com.