Los Angeles, CA – Jeffrey Ikahn, also known as Jeffrey Santulan and Jeffrey Hill, and his company Safeguard Metals LLC, have been ordered to pay a combined $51.2 million in restitution and penalties for perpetrating a nationwide precious metals fraud, the Commodity Futures Trading Commission (CFTC) announced Tuesday.
The U.S. District Court for the Central District of California issued a final judgment on September 30, requiring Ikahn and Safeguard Metals to pay $25.6 million to defrauded customers and a $25.6 million civil monetary penalty. The scheme allegedly bilked over 450 customers, many of whom were elderly or nearing retirement age, out of approximately $68 million.
According to the CFTC, Ikahn and Safeguard Metals lured investors by falsely claiming their traditional retirement investments were at risk. They then sold them silver coins and other precious metals at inflated prices, concealing substantial markups that resulted in immediate losses for customers. This fraudulent activity took place over several years and involved coordination with 30 state securities regulatory agencies under the North American Securities Administrators Association (NASAA).
“This resolution shows the impact the CFTC and state regulatory agencies have when joining forces to combat fraud,” stated Charles Marvine, Acting Chief of the CFTC’s Division of Enforcement’s Retail Fraud and General Enforcement Task Force. “It is a testament to the hard work of staff at the CFTC and our state regulator co-plaintiffs.”
The court previously found Ikahn and Safeguard Metals liable for the scheme via a consent order. This ruling prohibits them from future violations of the Commodity Exchange Act and CFTC regulations, as well as comparable state laws. They are also barred from trading or registering with the CFTC and participating states.
In a parallel case brought by the Securities and Exchange Commission (SEC), Ikahn and Safeguard Metals were also ordered to pay $25.6 million in disgorgement and a $25.6 million civil penalty. The CFTC and SEC will offset payments made in both cases to ensure victims receive maximum compensation.
The CFTC cautions that recovery of funds may not be complete, as the defendants may lack sufficient assets. The agency and NASAA expressed gratitude to the SEC for its assistance in the investigation.
Source: CFTC.gov
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