As Precious Metals investing increases in popularity, there is an increasing occurrence of companies based in China that have participated in fraudulent activities, including the disappearance of client funds.

There is no official regulatory body that authorizes and approves companies to represent as certified Precious Metals brokers within China. As a precaution, we advise our clients and investors to avoid conducting business with any unregulated broker based in China.

To operate as a financial entity within China, companies must have the proper licenses and certifications. All companies must also adhere to government legislation to operate as a company. Some companies posing as a Precious Metals broker may act on behalf of a foreign-based company, which is illegal. All companies, even if they have the corresponding legal licenses in other countries must have a China-based license to operate as a business with Chinese based clients. Therefore, a company acting on behalf of a foreign-based company may still be able to participate in fraudulent activities. As such, clients who have invested funds associated with these agents may find themselves victims of fraudulent activities with no protection or compensation from the Chinese government.

As the financial market in China is still in its infancy, the best practice for clients is to avoid trading in unregulated companies, agents or parties that act as Precious Metals brokers in Mainland China.