MILWAUKEE (WITI) -- Investors were promised big returns when they decided to invest thousands of dollars in the gold coin business. A lot of people think precious metals are a safe bet during a rocky economy, but in this case, it became fool's gold.
"They promised me $25,000 in and hundreds of thousands out," the anonymous victim said.
This man was one of 500 victims who lost almost $3 million after sinking his money into the International Rarities Corporation, only to learn it was a scam.
"Complete economic devastation. It wiped out their retirement savings, their complete savings," U.S. Postal Inspector Robert Strande said.
In 2008, when the banking industry was on shaky ground and Wall Street was experiencing a meltdown, opportunistic con men began touting the safety of the precious metals market.
"These victims that are elderly, they come from a generation that believes in the validity and value of coins and precious metals," Strande said.
Postal inspectors say con men focused on the victims' fear of an uncertain economic future to get them to buy in, and they did.
"Most people lost a tremendous amount of money -- college savings for their children, and grandchildren anywhere from $25,000 to $100,000 each transaction," Strande said.
Law enforcement officials say the gold industry had been growing quickly, but it is always important for investors to do their homework.
"Before you get started, you should have an idea yourself for what the coins are worth and then you consult a number of different dealers before you settle on who you are going to deal with," Assistant U.S. Attorney Karen Schommer said.
Another important tip...
"Don't turn over your coins to anyone else without a deal in place and have it in writing. Don't just have a verbal agreement," Schommer said.
"I thought I had done my due diligence and obviously I didn't. No matter what information you have - you have to try and dig deeper," the anonymous victim said.
The founder of the International Rarities Corporation was indicted for defrauding clients and still awaits sentencing. Authorities say he used the money to gamble and live large.