It was reported in Today’s newspapers that The Gold Label, a company specializing in selling gold as an investment to retail investors, is in cashflow difficulties.
The company entices people to invest with them by way of a sales and buyback agreement, promising attractive yields.
I had earlier warned that such a scheme offered by The Gold Label (or similar companies) would not be sustainable.
In October this year, the company’s directors had actually filed a notice to ACRA that they were not to continue business as they were unable to meet their liabilities.
The Gold Label was also recently placed on MAS’s investor alert list, more than one year after it started operating.
In the meantime, Genneva Gold continues to operate. Will this signal the start of a run on Genneva Gold?