Most guidance on precious metals in retirement accounts argues about how much to allocate. The more consequential question is what you pay to get in — because on a physical metals purchase, the markup is deducted the moment you buy, and no allocation strategy recovers it.
The Spread Is Where the Money Goes
FINRA's investor bulletin on physical metals puts hard numbers on the range. Legitimate dealers, it notes, may charge spreads of less than 20% over the spot price. Fraudulent ones have charged spreads exceeding 300%.
The bulletin cites a case in the plainest terms available: a customer rolled over a $300,000 IRA, and the dealer allegedly took $150,000 in fees and commissions. That account needed to double before the investor broke even on metal that never moved.
This is not a fringe problem. In a joint outreach effort, the CFTC's Office of Customer Education and Outreach, FINRA and the North American Securities Administrators Association noted that over the prior decade the CFTC brought cases against dealers collectively selling more than $500 million in overpriced metals. The largest, filed in September 2020 by the CFTC and 30 state regulators, accused TMTE Inc. — trading as Metals.com — of taking in more than $185 million from over 1,600 mostly elderly investors.
Why Your Custodian Will Not Catch It
Retirement savers routinely assume the IRA custodian is doing diligence. It is not. FINRA's framing is blunt: once funds move into a self-directed IRA, "you're on your own (that's the self-directed part of SDIRAs)." Custodians do not investigate the assets or the promoters who sell them.
There is one useful exception, and it is the single most valuable disclosure in the entire arrangement. Custodians must send account statements showing the melt value of your holdings — total bullion weight multiplied by the current spot price. Compare that figure against what you actually paid. The gap is your markup, stated in dollars, whether or not the dealer ever disclosed it.
The Federal Backstop Is Contested
Here is the development most investors have not heard. Retail metal dealers face no federal regulation as such; the CFTC's authority over them runs through the Commodity Exchange Act's antifraud provisions. In July 2025, Judge Brantley Starr of the U.S. District Court for the Northern District of Texas questioned whether that authority exists at all, reading the CEA's definition of "commodity" narrowly and concluding it "does not encompass precious metals as commodities because they are neither agricultural products nor movie tickets."
The ruling rejected cross-motions for summary judgment rather than ending the case, and one district court does not bind others. But it signals that the federal cop on this beat may be less certain than retirees assume — which raises the value of state regulators and of your own pre-purchase diligence.
What to Do Before You Wire
- Get the spot price yourself, from an independent source, on the day you buy. Everything above it is the spread.
- Demand all fees, commissions and the agreed retail price in writing before funding — not after.
- Check registration and complaint history with your state securities regulator and attorney general. State agencies co-brought the largest metals cases.
- Separate bullion from numismatic coins. "Rare" and "collectible" framing is where the widest markups hide.
- Treat unsolicited contact as disqualifying. Cold calls and social media pitches are the documented entry point for these schemes.
Sources: FINRA Investor Bulletin — 10 Things to Ask Before Buying Physical Gold, Silver or Other Metals; CFTC Press Release 8881-24 (joint CFTC/FINRA/NASAA retiree outreach); CFTC Press Release 8254-20 (CFTC and 30 states v. TMTE Inc., d/b/a Metals.com); CFTC v. TMTE Inc., N.D. Tex. (Judge Brantley Starr, July 2025)