But as the ABC News investigation revealed, the questions about Goldline appear to be moving beyond political theatrics. In addition to the joint investigation launched by the Los Angeles County District Attorney and the Santa Monica City Attorney, a law firm in Texas announced Tuesday that it has filed a class action lawsuit against Goldline in the U.S. District Court in Greenville, South Carolina.
"Goldline grossly overcharges for its numismatic coins and bullion, falsely and deceptively claims that its products are 'good' investments, and its sales persons misrepresent themselves as 'Investment Advisors' or 'Financial Advisors' able to give 'investment advice' and imply that they have a fiduciary responsibility to get customers the most return on their investments," the lawsuit alleges.
"Goldline products are, in fact, a bad investment, and its marketing scheme is nothing more than a scam designed to induce market-wary investors to purchase numismatic coins and bullion worth far less than represented by Goldline and its outside associates," said the lawsuit filed by Houston attorney W. Craft Hughes.
Carter, the Goldline executive, attempted to address the question of whether the company offers investment advice during his interview on Good Morning America this morning.
"You're talking about investments here but in fact your sales people are not investment advisers," George Stephanopoulos noted to Carter during the interview. "And the reason for that is so they can avoid regulation by state regulatory authorities and the [Securities and Exchange Commission]. They don't have this legal and fiduciary responsibility to look out for the customer."
"You're absolutely right," Carter replied. "We are not legal advisers, but they do understand precious metals, and individuals are calling to diversify their portfolio … And we take great pride in how we treat our customers."