Dealers in Precious Metals AML Red Flags

Customer purchases gold or silver bullion with cash in amounts just below the $10,000 Form 8300 threshold, and returns on subsequent days to make similar purchases at the same or affiliated dealer.

Customer breaks a large cash purchase into multiple transactions across different precious metals dealers in the same geographic area, each transaction below the reporting threshold.

Customer purchases gold bullion and immediately requests the dealer to ship it to a third-party vault or storage facility in a different country, with no stated investment or business reason for the offshore storage.

Customer requests shipment of purchased precious metals to a jurisdiction under comprehensive OFAC sanctions, using an intermediary freight forwarder in a non-sanctioned country to conceal the final destination.

Business customer purchases large volumes of gold using funds wired from a sanctioned jurisdiction, then requests the metals be held in a third-party vault and used as collateral for a letter of credit in a non-sanctioned country.

PEP purchases large quantities of gold bullion with funds wired from a government-owned bank account, and requests discreet shipping to a private vault with no stated investment rationale.

Customer brings large quantities of cash in small denominations ($20 and $50 bills) to purchase gold coins, with the cash wrapped in rubber bands and stored in a duffel bag rather than a bank envelope.

Customer consistently pays premiums well above the spot price for bullion or numismatic coins, showing no interest in the investment value and asking only about resale liquidity and anonymity.

Customer wires funds from an account in a high-risk jurisdiction to purchase precious metals for physical delivery, with no prior relationship with the dealer and no explanation for the international purchase.

Corporate customer wires funds for a large bullion purchase from an account that receives frequent unexplained cash deposits, suggesting the wire is a layering step in a cash conversion scheme.

Customer provides identification that appears tampered with or forged, or refuses to provide a government-issued photo ID for a cash purchase above the dealer’s internal threshold.

Trust or LLC wires funds for a precious metals purchase but the beneficial owners are concealed, and the trustee or manager is a professional nominee with no independent relationship to the metals.

Corporate customer purchasing large volumes of gold refuses to identify the beneficial owners, and the company is registered in a jurisdiction known for shell company formation with minimal disclosure requirements.

Customer buys and sells the same type of precious metal repeatedly within short timeframes at a loss, suggesting the transactions are designed to create a paper trail rather than generate investment returns.

Customer requests that the dealer melt down purchased gold coins or bars into untraceable granules or dust, with no legitimate manufacturing or industrial purpose for the melting.

Foreign national purchases large volumes of precious metals for export to a jurisdiction with weak AML controls or active conflict, with no verifiable business or personal ties to the destination country.

Customer appears nervous during the transaction, avoids eye contact, rushes the purchase, or becomes hostile when asked routine questions about the source of funds or the purpose of the purchase.

Elderly customer is accompanied by a younger individual who selects the items, handles the cash, and insists the purchase be shipped to an address not associated with the elder’s residence.

Business customer purchases large volumes of gold or silver with cash but the business type is unrelated to jewelry, manufacturing, or investment, and has no legitimate commercial need for precious metals.

Customer frequently changes their name, address, or contact information between visits, or uses different identification documents for each transaction at the same dealer location.

Customer asks the dealer about Form 8300 thresholds, how to avoid reporting requirements, or whether the dealer shares transaction data with FinCEN or other government agencies.