Goldline Hired 3 'Boiler Room' Salesmen Sued By SEC


He also said that one FTC complaint against Wasserman after thousands of sales and years of service to the company did not warrant criticism of Wasserman.

Carl Holmes, who says he worked as a Goldline salesman from May to August 2008, described Land and Wasserman as "the cream of the crop" of the company's sales associates. According to Holmes, the two men trained new sales people, were responsible for handling the biggest accounts, and took over accounts from other sale reps who "needed help to close a deal."

ABC News attempted to contact Land, Wasserman and Boratgis at Goldline, but a company representative said they would not be made available for interviews. Carter said it would not have been unusual for any of the more experienced sales personnel to work with a trainee like Holmes.

The chief focus of the hearings will be allegations that company salesmen have nudged callers away from buying gold bullion and into purchasing collectable coins, which are unregulated and subject to sizeable mark-ups. According to Holmes, "if a customer were to call in and only want gold as far as bullion, then it was my job to persuade them to buy the collectors' gold."

"If I was unsuccessful, then I would turn the call over and get somebody else who was more quote unquote, "experienced," to see if they can persuade them to buy collectors' coins and get a higher commission," Holmes said.

Carter disputed Holmes' characterization of Goldline's sales strategy, but has defended the company's emphasis on collectable coins, which he said would be less likely to be subject to government confiscation.

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Carter says the company is up front in its advertising that it wants customers to buy coins.

"Ultimately, our view is we believe in customer choice, full disclosure and a friendly and open sales process," he said. "Our most popular product, the Swiss 20 Franc, has earned a 240 percent return, excluding our fees. It's tough to argue with that return."

Goldline Investigation in California

But Holmes told ABC News that the coins have largely resulted in poor returns for Goldline clients because he says they often find it difficult to resell them for anything close to what they paid. Even with the rapid rise in the value of gold, he said, most of those he sold coins to "have yet to break even."

Holmes said he eventually stopped pushing them and was eventually let go by the company for poor performance.

Customer complaints about the company ultimately led to a formal, ongoing investigation launched jointly by the Los Angeles County District Attorney and the City Attorney in Santa Monica, where Goldline is based. The complaints also caught Weiner's attention. He has proposed legislation that would force Goldline, as well as other coin and precious metal dealers to disclose all fees as well as the melt value and reasonable resale value of any purchase in a clear and conspicuous manner. If it passes, the legislation would give the Federal Trade Commission the authority to fine companies that violate the law up to $16,000 per violation and gives states the authority to enforce this law as well.

CLICK HERE to follow ABC News Chief Investigative Correspondent Brian Ross on Twitter.

Carter said he considers the current version of the legislation unworkable. Goldline has hired a top DC lobbying firm to help defeat it.

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