The price of an ounce of gold is higher than ever -- more than $1,300. People are buying, and people are selling. And some inevitably will get ripped off.
One expert who keeps his eye on scams involving commodities, rare coins and paper money investments is Doug Davis, the Pantego city manager.
For more than 20 years, he has run a national clearinghouse that helps buyers, sellers, crime victims and police investigators track such crimes.
In his spare time, he runs the Numismatic Crime Information Center, which specializes in providing victims and investigators information they need to catch the bad guys. His website -- www.numismaticcrimes.org -- is known by collectors, police and others.
Sign Up and Save
Get six months of free digital access to the Star-Telegram
Davis says that when the economy sours, the price of gold usually rises. That doesn't just bring out investors. Scammers flood the market, too.
The Texas State Securities Board issued a warning last week "to be cautious about jumping on the gold bandwagon."
"Beware of gold investment schemes," Securities Commissioner Denise Voigt Crawford said in a statement. "The gold may not exist."
Davis, 58, is a natural for this work. After graduating from Richland High School in 1970, he owned a coin shop in Grand Prairie before going into police work. He was Pantego's police chief for 16 years before becoming city manager.
Twenty-five years ago, as a young investigator for the Pantego police, he got a call that the owner of a coin shop, a friend of his, was robbed and shot execution-style in the back of his store.
"I took it as a personal thing," Davis recalled.
For two years, he traveled across the country, visiting coin shows and asking questions. He was looking for the loot to be sold. Finally, he picked up the right lead, and one suspect, the lookout on the crime, was captured and convicted. Two others were eventually convicted, too.
"Traveling all over the country and talking to law enforcement officers, I knew right away that they didn't have any idea how to investigate these kinds of crimes," Davis said. "I decided this was one area where I could help be a resource."
He started the crime information center out of the Pantego Police Department.
"I just kept track of offenses that occurred to dealers and collectors across the country," he said.
Police investigators call him for information, and he often calls them and offers on-the-spot training. When he hears about a crime, he alerts his network about the details.
At first, he says, other investigators wondered why they were talking to "a police chief from Podunk, Texas" for help, but his reputation grew.
Rod Gillis of the American Numismatic Association says Davis' project "provides a valuable service to collectors and dealers alike who have lost their coins."
Paul Montgomery, president of the Professional Numismatists Guild, says: "Doug is an amazing guy. He cares about the industry and helps protect us. He makes sure that people know the modus operandi that the bad guys are using."
John Albanese, founder of the Numismatic Consumer Alliance, said: "We've heard good things about him. We donated a few thousand dollars to his nonprofit. They provide a good service, and we support him."
Davis says record prices for gold are a golden lure for crooks looking to con investors. Robberies and burglaries are also a growing problem.
And then there are all the "we buy and sell gold" businesses that suddenly pop up.
"I'm not saying these are good, bad or ugly," he said. "You just have to be careful who you're dealing with. You need to try and stay with people who have been in the business for a long time and built a reputation. It's just common sense."
He recommends long-established coin shops. "Talk to them. Find out what they're like. See if they're willing to answer questions."
And check with the Better Business Bureau for complaints.
"If you're going to buy something, unless you know these companies and their reputations and know somebody that's done business with them before, you really have to research and make sure they are a reputable firm."
I wanted to tell you about Davis' Numismatic Crime Information Center because it's an idea that could be adopted to help foil many types of scams.
Police have a tough time keeping up with the latest cons. Experts who not only track the crimes but also show how to investigate them can make a difference.
Davis says he shows police investigators "how to be a hero to the victims."
It's quite amazing, and if the idea ever catches on for other crimes, it would make it a lot harder for scammers of all stripes to get away with their crimes. Actually, it could help put them in prison stripes.
The Watchdog column appears Fridays and Sundays.
Dave Lieber, 817-685-3830