February 23, 2012, 12:30 PM.

Goldline Agrees to Refund $4.5 Million.

By Joe Light

Gold coin and bullion dealer Goldline International agreed on Wednesday to refund up to $4.5 million to former customers, ending the criminal prosecution brought against the company last November.

As we wrote last year, the Santa Monica, Calif., city attorney’s office in November filed a criminal complaint against Goldline accusing it of misleading customers who wanted to buy gold bullion into buying overpriced coins instead. This month, the city attorney brought a separate consumer-protection lawsuit against the company.

According to the Los Angeles Times, the criminal charges were dropped as part of the settlement.

The settlement requires Goldine to change its sales practices, refund up to $4.5 million to former customers who return gold coins they bought and to put $800,000 into a fund for potential future claims.

According to the city attorney, the injunction requires Goldline to disclose its markups in recordings before each sale and stop telling customers that the government can confiscate gold bullion, among other requirements.

In a statement, Goldline CEO Scott Carter said, “Goldline is proud to raise the bar once again by enhancing disclosures and procedures that are unprecedented in the precious metals industry.”

Goldline Agrees to Refund $4.5 Million - Total Return - WSJ