Frequently Asked Questions

General Questions:

WHAT IS THE PRIMARY BULLION MARKET?

The largest and most competitive gold markets in the world are defined by the participants in the Primary Bullion Market.

The Primary Bullion Market consists of Central Banks, Bullion Banks, Government Agencies, large institutional traders, refineries, and fabricators. These participants are able to trade gold in the OTC market at the most competitive global prices.

This wholesale market is the basis for virtually all transactions in gold and silver. Trades are made by dealers based on US dollars per fine ounce for gold and US dollars per ounce for silver. Settlement and delivery for metals is two business days after an order is executed.


WHAT IS THE LONDON BULLION MARKET ASSOCIATION?

The London Bullion Market Association (LBMA) is the London-based trade association that represents the wholesale gold and silver bullion market in London. London is the focus of the international Over-the-Counter (OTC) market for gold and silver, with a client base that includes the majority of the central banks that hold gold, plus producers, refiners, fabricators and other traders throughout the world.

The LBMA Good Delivery List is now widely recognized as representing the de facto standard for the quality of gold and silver bars, in large part thanks to the stringent criteria for assaying standards and bar quality that an applicant must satisfy in order to be listed. The assaying capabilities of refiners on the Good Delivery List are periodically checked under the LBMA’s Proactive Monitoring program.

The ongoing work of the Association encompasses many areas, among them refining standards, trading documentation and the fostering of good trading practices. Some examples:

  • In January 2004 the LBMA introduced proactive monitoring of refiners on the List, an important initiative which further enhances the reputation of the List and the refiners on it.
  • In conjunction with the foreign exchange and money markets in London, the Association has developed the Non-Investment Products Code, which provides a code of conduct by which all Members and Associates are required to abide.

WHAT ARE LBMA “GOOD DELIVERY STANDARDS”?

A primary function of the London Bullion Market Association (LBMA) is facilitating the international distribution and acceptability of their gold bars. Historically, members of the London bullion market compiled lists of accredited smelters and assayers whose gold bars they would accept without question in settlement against transactions conducted between each other and with acceptable counterparties.

LBMA Good Delivery accreditation has become an internationally accepted standard of quality. Today, refiners of gold have to satisfy the Physical Committee of the LBMA that their bars meet the stringent requirements outlined in the “LBMA Good Delivery List.” For this reason, the on-going review and maintenance of this list is a core function of the LBMA. Additionally, the assaying capabilities of refiners on the Good Delivery List are periodically checked under the LBMA’s Proactive Monitoring system.

Good Delivery Rules for Refiners

Refiners wishing to apply for Good Delivery status submit applications to the LBMA Chief Executive, who in turn consult members of the Physical Committee to assess the refineries. The main requirements to be considered for listing are normally:

  • The applicant has been in existence for not less than five years and has been involved in refining operations of the metal for which it is applying for Good Delivery status for not less than three years prior to the application.
  • The applicant has an established annual refining production (which need not be in the form of standard bars) of no less than 10 tonnes of gold.
  • The applicant has a tangible net worth of not less than the equivalent of £15 million or such figure as the LBMA may from time to time determine.
  • The applicant’s ownership, financial standing and reputation would allow it to satisfy the KYC (Know Your Customer) tests practiced in the London bullion market.

The LBMA Good Delivery List is now widely recognized as representing the de facto standard for the quality of gold and silver bars, in large part thanks to the stringent criteria for assaying standards and bar quality that an applicant must satisfy in order to be listed.


WHAT IS A GOOD DELIVERY BAR?

The Good Delivery specification is a set of rules issued by the London Bullion Market Association (LBMA) describing the physical characteristics of gold and silver bars used in settlement in the wholesale London bullion market. These bars are notable for their recognized brands and high purity.

Good Delivery Rules for Gold Bars

Details of the specific standards required for inclusion on the LBMA Good Delivery List are published by the LBMA in the “Good Delivery Rules for Gold and Silver Bars,” available on their website.

Generally, to qualify as Good Delivery metal, gold bars must conform to the following specifications:

  • Form: plate or ingot
  • Weight: minimum 350 fine troy ounces (approximately 10.9 kilograms); maximum 430 fine troy ounces (approximately 13.4 kilograms)
  • Purity: the minimum acceptable fineness is 995.0 parts per thousand fine gold
  • Appearance: smooth, free from cavities, holes, or blisters and easy to handle
  • Markings include the following: (a) Assay stamp of refiner, (b) Fineness, (c) Serial number and (d) Year of manufacture

WHAT DOES “CHAIN OF INTEGRITY” MEAN?

Precious metals ownership via the Clear Title Accounts affords our clients a critical defining feature within the Primary Bullion Market: The Chain of Integrity.

To ensure that all metals we hold on behalf of our customers are of the highest quality and that the bars contain the weight of metal they are said to contain, we maintain the Chain of Integrity. This means that a bar from outside the chain can only be entered into the chain once it has been proven that the quality of the bar is according to LBMA Good Delivery standards.

The members of the Primary Bullion Market ensure that every bullion bar delivered into this Chain of Integrity was refined by an accredited bullion refiner and stamped with its four distinguishing characteristics:

  • A unique serial number
  • The purity or fineness of the bar
  • The official bar weight
  • The refiners mark

Bars traded by London Bullion Market Association (LBMA) members maintain a traceable chain of custody among trusted trading partners. The LBMA maintains a list of acceptable member refineries that meet certain membership requirements and have passed assay tests. This is important because bullion products from these refineries will generally be accepted by other members of the LBMA at face value without further assay testing. When purchasing bullion products, the face value can generally be accepted if the product can be shown to have remained in the custody of a certified bullion repository since its manufacture by an acceptable refinery. The rules established by the LBMA create the environment whereby members can trade bullion between themselves without concern as to the quality or the purity of the bars.

WHY IS IT IMPORTANT TO HAVE ‘GDS’ BULLION OWNERSHIP?

From the day they are manufactured, Good Delivery Standards bars are kept in bullion vaults recognized and monitored by the gold-dealing community. The same standard applies for silver and platinum. Whenever the bullion bars are moved, a record is maintained showing continuous storage through trusted hands. This audit trail, or “Chain of Integrity”, guarantees the bar’s authenticity and becomes key to assuring the liquidity of the precious metal. Taking delivery of the bullion and storing it at home, or even storing in a safety deposit box, does not confirm the provenance of the bar. The bar must be re-assayed prior to selling it back into the gold-dealing community.
Because the quality of the bullion remains verified when it is in the Clear Title Account Program, you can sell your bullion without the need to re-confirm its purity – this greatly reduces the time required to sell the bullion and reduces the costs related to a sale.


WHAT IS THE SPOT MARKET PRICE?

This refers to the price paid for an asset when the exchange of goods and money between buyer and seller takes place in the present, or “on the spot”. This is opposed to the futures market, where delivery of goods takes place on a specified future date. The spot market is also known as the “cash market”.

The best gold price in the world, the internationally quoted Spot Market Price, is exclusively enjoyed by the participants in the Primary Bullion Market. By becoming a Strategic Gold client, you too will enjoy the substantial price advantages usually reserved for large institutional traders, refineries, fabricators, government agencies and bullion banks.

The Spot Market is where these large professional bullion traders buy and sell gold for immediate settlement. It is a distributed market made up of professional bullion market participants from around the world who share a common set of rules and standards when trading gold with each other.

When quoting the spot price to each other it is understood that:

  • The buyer is paying in full within 48 hours.
  • The price quoted is in US dollars per troy ounce.
  • Bars will be Good Delivery gold bars manufactured by refiners on the LBMA Good Delivery list.
  • The units of delivery will be whole 400 oz bars.
  • The buyer will send a recognized specialist bullion courier to the sellers vault door for the collection, at the buyer’s expense.

WHAT IS THE LONDON GOLD FIXING?

The Fixing is an open process in which precious metals market participants can transact business on the basis of a single quoted price. Orders can be changed throughout the proceedings as the price is moved higher and lower until such time as buyers’ and sellers’ orders are satisfied and the price is said to be ‘fixed’. Orders executed at the fixing are conducted as principal-to-principal transactions between the client and the dealer through whom the order is placed.

The current LBMA Gold Price was launched on the 20th March 2015 to replace the historic London Gold Fix. ICE Benchmark Administration (IBA) provide the auction platform, methodology as well as overall independent administration and governance for the LBMA Gold Price, with the LBMA holding the intellectual property rights.The price continues to be set twice daily (at 10:30 and 15:00 London BST) in US dollars. Sterling and Euro prices are available but they are indicative prices for settlement only. The independent third party provider, ICE Benchmark Administration (IBA) were chosen following consultation with market participants. IBA provides the price platform, methodology as well as the overall administration and governance for the LBMA Gold Price. The IBA’s platform provides an electronic, auction-based, tradeable, auditable and fully IOSCO-compliant solution for the London bullion market.


ADDITIONAL RESOURCES:

WHICH BANKS ARE THE MEMBERS OF THE LONDON GOLD FIXING?

There are currently fourteen Gold Fixing members – all of whom are Market Making members of the LBMA. They are Barclays Bank, Bank of China, Bank of Communications, China Construction Bank, Goldman Sachs International, HSBC Bank USA NA, ICBC Standard Bank, JP Morgan, Morgan Stanley, Societe Generale, Standard Chartered, The Bank of Nova Scotia – ScotiaMocatta, The Toronto Dominion Bank and UBS.


ADDITIONAL RESOURCES:

WHAT IS THE PROCEDURE FOR ARRIVING AT THE FIXING PRICE?

The chairperson sets the starting price and the price for each round in line with current market conditions and the activity in the auction. Participants then enter their buy and sell orders by volume (i.e. number of ounces). The price discovery process is in US Dollars but participants may, if they wish, request to settle in different currencies. If the net volume of all participants fall within the pre-determined tolerance at the end of a round (i.e. the imbalance is set at 10,000 oz.), the auction will be complete, with all volume tradeable at that price. Netting of orders is processed automatically for participants with all house and client orders, plus any share of the imbalance, contributing to their final net volume. This net volume is then matched against other participants to produce trades with immediate trade

confirmations.


ADDITIONAL RESOURCES:

HOW IS THE FIXING USED IN THE MARKET?

The fixing is used to deal in large amounts, or to achieve the accepted average price of the metal. As a benchmark, many other financial instruments are priced off the fixing, including cash-settled swaps and options. The silver fixing started in 1897 and will end in August of 2014 and the gold fixing started in 1919.

WHAT IS GOLD’S HISTORICAL SIGNIFICANCE?

Since the dawn of civilization, gold has been sought after for its status as a means of exchange and universal store of value par excellence. In fact, gold has served as a universal medium of exchange, a symbol of prestige, a store of value, and a reserve against political and financial instability. Only gold has all of the attributes desirable in a store of value – it is very rare, non-toxic, non-corrosive, uniform, portable, divisible, malleable, universally coveted and accepted, fungible and highly valuable. People only trust in money as long as it offers a certain degree of safety with regard to its future supply and thus to its future purchasing power.

Gold discovery and production are extremely capital intensive, which limits new supply.

Unlike financial assets, physical gold is not a promise to perform in the future and does not rely on counterparties. Gold produces no cash flow, and its value is based on global supply and demand rather than financial valuation conventions. Physical gold markets – worldwide – are well established and operate independently from securities markets and financial institutions. Unlike financial accounts, well-managed physical gold ownership confers Clear Title to a real asset that delivers protections from counterparty, systemic and sovereign risks.

Throughout history, all nations and civilizations have sought to possess gold as a medium of international exchange and as a store of wealth. Individuals have used gold as a store of wealth and as insurance against the fluctuations and depreciation of paper money and to protect against other macroeconomic and geopolitical risks.

Gold has out-lived every other form of money known to man. It has provided protection against the destruction of wealth for centuries. No other asset has matched the universal appeal of gold or its safe haven properties.


ADDITIONAL RESOURCES:

WHY INVEST IN PRECIOUS METALS?

Investors have historically turned to tangible investments such as gold bullion bars to protect their wealth and secure their
purchasing power over long periods of time.

Gold effectively helps manage risk in a portfolio, not only by means of increasing risk-adjusted returns, but also by reducing expected losses incurred in extreme circumstances. Such tail-risk events can have a devastating effect on an investor’s capital. On one hand, short and medium term holders can take advantage of gold’s unique correlation to other assets to achieve better returns during times of turmoil. This is especially true given that gold’s correlation tends to change in a way that benefits investors who hold it within their portfolios. On the other hand, by including gold in their portfolios, long term holders can manage risk without necessarily sacrificing much sought after returns.

Analysis suggests that even relatively small allocations to gold, ranging from 3 to 10 percent, can have a positive impact on the structure of a portfolio. It finds that, on average, such allocations can reduce the VaR of a portfolio, while maintaining a similar return profile to equivalent portfolios that do not include gold.

There is a strong case for gold to be allocated as an asset class on its own merits. It is part commodity, part luxury consumption good, part financial asset and part monetary asset, and as such, its price does not always behave like other asset classes and especially not other commodities.

Finally, while the key benefits to investing in gold concentrate on risk in the form of tail-risk and volatility, gold has other unique risk-related attributes that make it very useful in periods of financial distress. For example, the gold market is highly liquid and many gold bullion investments have neither credit nor counterparty risk.


DOES GOLD OFFER PROTECTION AGAINST SYSTEMIC RISK?

Today, our global financial system is more connected and integrated than ever before and the sheer size of many corporations and banks and the huge levels of debt at all levels of society and increasingly with governments means that the global financial system is more at risk of contagion and a systemic crisis than before.

What began as a financial crisis in 2007- 2008 has become a global systemic and economic problem. Toxic financial instruments and huge liabilities that crippled banks and financial institutions have now become nationalized by a process of unprecedented government and central bank intervention. Rather than allowing the market to purge itself, governments poured trillions of dollars of taxpayer money into this highly unbalanced system. Central Banks and governments implemented massive policy responses, seemingly overnight, that have effectively blurred the necessary distinction between the defining institutions of our monetary system: government and banking. As Central Banks pushed interest rates to zero and provided colossal liquidity injections into the banking system, governments simultaneously intensified spending. In an effort to save the financial system, monetary and fiscal restraint has been abandoned.

We now find ourselves in a catch 22 scenario where the system and the products of the system are at odds with each other. Either’s survival requires the destruction of the other. Looking ahead, only those people who have secured assets outside of the system will enjoy the full value of their wealth.

Gold, unlike corporations, banks and indeed governments cannot go bankrupt. While gold rises and falls in value like other currencies and assets, its scarcity means that it always retains some value.
Gold has a track record of holding its real value over the centuries. Since gold is no-one’s liability, it cannot be repudiated and holding it is a safeguard against potential unforeseen crises such as an international monetary crisis or a systemic crash. Gold also brings much needed diversity to investor, pension and central bank portfolios due to its low correlation with key currencies and its strong inverse correlation with the US dollar.

Gold bullion that is owned outright and not kept within the financial system is a good hedge against systemic risk. Unlike property and other assets that are normally financed through debt (and are therefore often liquidated in order to pay off the debt or liability), gold bullion is no one else’s liability.

As a rule, gold shows no statistically significant correlations with mainstream asset classes. However, there is evidence that when equities are under stress, in other words when shares are falling rapidly in value, an inverse correlation can develop between gold and equities. And this aspect of gold’s behavior runs directly counter to the way other asset classes perform under duress. Therefore, gold is an important part of a diversified investment portfolio because its price increases in response to events that erode the value of traditional paper assets like stocks, bonds and cash.


WHY IS GOLD CONSIDERED PORTFOLIO INSURANCE?

Traditional asset allocation models do not account for new systemic risks. Consequently, the vast majority of wealth remains concentrated in financial instruments within a highly correlated system that is vulnerable to financial and systemic failures. Systemic risk cannot be insured within the system. An effective wealth preservation strategy requires the inclusion of assets that are not correlated to traditional financial instruments, do not rely on financial counterparties and deliver geographic diversification and global liquidity. Physical Gold owned and stored outside of the financial system uniquely satisfies these criteria.


DOES GOLD ACT AS A SAFE HAVEN AGAINST CURRENCY WEAKNESS?

Most nations around the world (particularly the G7) are creating money in an attempt to depreciate their currencies. In a global economy, no country can effectively compete in the marketplace of producing goods and services if their currency is over-priced relative to their competitors. Given this reality, all are engaging in competitive currency devaluations.

Over the next few years, Central Banks led by the Federal Reserve will intensify their money creation. Quantitative easing and monetization of debt are the Fed’s only options. When so much new money is created in such a short time and under such weak economic conditions that the total supply of money rises rapidly, it distorts price signals, brings about the undeserved transfer of wealth to the first receivers of the new money, and depletes real savings. In the US, there has been enough growth in the money supply in the past 5 years to do substantial damage to the economy. And yet, the Federal Reserve and the government are attempting to overcome the adverse consequences of monetary inflation by creating even more money.

Foreign Central Banks and Sovereign Wealth Funds have taken notice as they seek diversification away from the dollar toward direct ownership of mineral resources, industrial companies, and other equity investments rather than Federal Reserve liabilities (dollars). As this easy monetary policy continues, the dollar’s inflation problem is set to become even more problematic in the years ahead. Gold is the premier store of wealth that the world has known for the past 3-4 thousand years precisely because it is, first of all, money. As money, its primary function is the preservation of wealth. When a currency depreciates, the main beneficiary will be the only real money which can’t be printed and which has no debts attached to it, namely gold.

HOW IS GOLD A HEDGE AGAINST MONETARY INFLATION AND ASSET DEFLATION?

Perhaps one of the most harrowing facts of our current situation is the potential for the simultaneous combination of monetary or price inflation (the destruction of the purchasing power of our money) with asset deflation (the destruction of the purchasing power of our assets). The collapse in the value of the currency and the value of assets constitutes a massive redistribution and destruction of wealth. Perversely, the segments of the population most affected by this destruction of wealth (creation of dollars without the ability to pay for those dollars) are retirees and those living on fixed income.

The magnitude of the worldwide financial trouble is astounding. The US, a nation not long ago known as the largest creditor nation has become the largest debtor nation. The US Government’s response to the situation, though predictable, is disturbing. Through an unprecedented and ever expanding monetary inflation, we are guaranteed an equivalent reduction in purchasing power (rampant price inflation) and asset devaluation.

An inflation hedge is an asset that loses little value in periods of rising prices. Thus, it holds its value and its purchasing power during inflation. Real assets have intrinsic value. They have value of their own. People value them for their direct or indirect usefulness. Inflation does not erode a real asset’s value. Thus, gold is the premier inflation hedge.

WHY IS GOLD AN ESSENTIAL COMPONENT OF A DIVERSIFIED PORTFOLIO?

Statistics have shown that gold provides excellent diversification opportunities as it is not correlated with returns from mainstream assets. A strategically diversified portfolio does not only contain a range of different asset types such as stocks and bonds, but should also have assets that have low correlation with one another.

Asset allocation is an important aspect of any investment strategy. By balancing asset classes of different correlations, investors hope to maximize returns and minimize risk. However, while many investors may believe that their portfolios are adequately diversified, they typically contain only three asset classes – stocks, bonds and cash.

Investing in gold neutralizes the volatility of traditional asset classes and attains a more balanced and non-correlated portfolio of investments. Portfolios that contain gold are generally more robust and better able to cope with market uncertainties and volatility than those that do not.

Gold offers enhanced diversification opportunities relative to many alternative assets. Independent studies have shown that while alternative assets and traditional diversifiers often fail during times of market stress or instability, even a small allocation to gold may significantly improve the consistency of portfolio performance during both stable and unstable financial periods.

CAN INVESTING IN PRECIOUS METALS BE A GOOD WAY OF SAVING?

Our customers often invest in gold and silver as a form of saving and wealth preservation. They view their bullion assets in their Clear Title Account as an alternative to cash in a bank account. The merit of this alternative form of real money is that it re-introduces the timeless wisdom of understanding value in terms of purchasing power. Additionally, they can log in to their Clear Title Account regularly to monitor their gold and silver, and add funds whenever they want to increase their bullion holdings.


IS THERE A RISK OF PRECIOUS METAL SHORTAGES?

Demand for gold is far outpacing supply. The supply of gold mined from the earth peaked in 2000-2001 and appears to be in a secular decline. Interestingly, even higher gold prices have not induced the expected response of higher mined supply.

2009 marked a momentous shift in Central Bank’s and Sovereign Wealth Fund’s treatment of gold. For the first time in decades, they emerged as a net source of demand—rather than supply—in the gold market. Large US creditors such as China, Japan, Russia, India, and the oil producing nations have been quietly diversifying out of US dollars and adding to their gold reserves. Looking forward, this fundamental shift should have a potent impact on the price of gold for many years to come.

Furthermore, the amount of physical gold being taken off the market by investors motivated by wealth preservation has increased exponentially. The ongoing flow of gold to private accounts may reduce the ability of above-ground gold stocks to meet increases in demand even at current prices.

The volume of gold traded through derivatives markets is a massive multiple of the underlying supply of physical gold available. As Central Banks and Sovereign Wealth Funds begin to step back from the gold market as providers of liquidity and investors store physical gold outside of the financial system the potential for a short squeeze in the gold market becomes ever more probable. In such a scenario, the price of physical gold will adjust to the point where supply and demand are once again in balance. The price mechanism ensures that supply equals demand, as is the case with any other asset not subject to government price controls. This price adjustment will only benefit those who hold physical gold.

ARE THERE RISKS INVOLVED IN PURCHASING GOLD?

All investments involve an element of risk – bullion is no exception. The value of bullion is affected by many economic factors, including the current market price and the perceived scarcity of the precious metal, current demand and general market sentiment. Other factors such as the bullion futures market can affect the price of physical bullion, sometimes significantly. Because bullion can reduce as well as increase in value, an investment in bullion may not be suitable for everyone. Since all investments, including bullion can decline in value, you should have a good understanding of the precious metals markets, and have adequate cash reserves before considering an investment in physical bullion.

With many bullion equity and investment products, the shareholder owns a beneficial interest (or shares) in a company, investment trust or equity, which in turn owns physical bullion. The value of the shareholder/investor’s shares is determined by the value and security of the company’s bullion holdings. Owning shares or a beneficial interest in a company is not the same as OUTRIGHT ownership of physical gold and/or silver.

Strategic Gold’s accountholders have DIRECT, COMPLETE and CLEAR TITLE to an actual and allocated amount of specific physical bullion.

IS THE GOLD MARKET A COMMODITY MARKET OR A CURRENCY MARKET?

Few people realize that gold is actively traded on the Forex just like every other currency. In fact, even though most banks refer to gold as a commodity, they trade gold at their currency desks not on their commodity desks. As a globally recognized currency, gold has the code XAU, which is not to be confused with the gold miner’s equity index with the same three letter acronym. It is also important to note that most central banks treat their gold reserves a part of their foreign currency holdings. So it is pretty clear — despite what most financial commentators might claim — that gold is money.

The foreign exchange market, also referred to as Forex, FX or currency market is the market in which currencies are internationally traded. This is a global market, trading 24H a day, with the bulk of trade in London and New York, but also sizable trade in Tokyo, Singapore and Hong Kong.

In September 2013, the Bank for International Settlements (BIS) released their study on the size of the FX market. This study, “Triennial Central Bank Survey 2013”, reported that the average traded daily volume in the FX market, as of April 2013 was estimated at $5.3 Trillion. This combines Spot transactions, Forwards, Swaps and Options.

In the currency markets, gold has an average daily trading volume of $249 Billion, which makes it the 5th most actively traded currency in the world. In other words, every trading day $249 billion dollars worth of credits denominated in a weight of gold trades in the currency market.

This is an astounding number. Perhaps we can put it into perspective by comparing the average daily volume of Gold on the Forex market with other markets where gold trades.

  • The daily volume of actual physical gold trading is around 16 tonnes or $650 Million.
  • The daily volume of trading in GLD (the ETF) is around 50 tonnes or $2 Billion.
  • The daily volume for the Comex is around 500 tonnes or $20 Billion.
  • The FX daily volume for gold is in excess of 6,000 tonnes or $249 Billion.

When we look at these numbers it becomes abundantly clear that the price of gold is not driven by the tiny physical segment of the market. Rather, the current price of gold is the product of a highly synthetic currency trade.

WHO HAS BEEN BACKSTOPPING THE GOLD MARKET?

Today the majority of gold investors own little more than a gold price tracking instrument — what is often referred to as “paper gold”. These credit-gold investments remain “as good as gold” only as long as they trade at parity with physical gold. Credit-Gold that trades as a currency requires, needs, and depends upon a functioning physical market which trades at parity to the credit-gold market. But the physical market does not require, need or depend upon the credit-market. This is not a codependent relationship. It’s more like a parasitical relationship, where the parasite cannot survive without the host, but the host will do just fine, or perhaps even better, without the parasite. Recent headlines indicate that this parity relationship is more tenuous than anyone might realize. In such an environment, why not own the real thing—free of parasites.

The European central banks have always been the lender of last resort in the fractional reserve practices of the gold market. As European central bank sales and leases dry-up, the credit-gold market will ultimately fail through its inability to provide physical gold for delivery. In the paper gold market, when a credit contract holder demands delivery, the bullion bank (market maker) has to borrow gold from someone else. The act of borrowing gold necessarily creates a new credit contract (a new paper gold owner). For several decades the European Central Banks have been the ultimate lender of physical gold in this chain—that is, until the acceptance of the Central Bank Gold Agreement (“CBGA”) was signed in 1999. The CBGA placed severe restrictions upon Central Bank sales and leases. With the acceptance of the CBGA, and its subsequent renewals, gold’s role as an essential wealth reserve has been secured.

IS THE GOLD PRICE MANIPULATED?

This is one of those questions that leave both investors and economists very divided.

Instead of concentrating on the issue of price manipulation, we find that it is far better to understand that the current “gold market” has a structural flaw which enables market participants to interfere in the price mechanism.

Although gold is no longer fixed to any official currency in the world, it still exists as an independent currency in the Over-the-Counter market. Banks manage this “currency” in a fashion analogous to other currencies: with tangible cash, account balances, the creation of credit, lending, debt, swaps, forward and futures contracts, and a host of derivatives. Banks have the ability to, in a certain sense, “create gold” through the construction of gold-price tracking derivatives. The largest gold-derivative market is the Forex market where “gold units” are created to hedge currency price fluctuations. 6,000 tonnes of this paper-gold trades on this market every day, making it the 5th most traded currency in the world.

With the introduction of these credit-gold derivatives the gold market needed to be reorganized so that bullion banks and central banks could treat their physical gold deposits in much the same way as they treat deposits denominated in currency; as the reserve asset against which they lend additional money to borrowers. Physical gold reserves needed to be collateralized so that trading against them could be made possible.

When a bank creates “gold units” on its currency desk, it is doing so completely in a non-physical way. This is nothing more than a cash-flow event whereby a customer with surplus Forex assets requests to exchange some or all of these assets for “gold units”. What this amounts to is a tremendous amount of digital activity whereby unallocated gold deposits custodied in the vaults of the bullion banks are subjected to fractional reserve banking practices. Through an ongoing counter-party squaring exercise, the network of banks fractionalize and derivitize the physical bullion reserves which they hold in custody. In so doing, the dollar, not physical gold, has become the primary “item traded” in the gold market. In fact, the gold market has become just another currency trading arena.

The fundamental flaw in the gold market, the same flaw that we can trace through every monetary system in human history and that ultimately causes its collapse, is when the system reaches the point where a potentially unlimited number of credit-claims can be traded for a limited amount of the underlying reserves. The essence of banking is lending and lending by design creates an enormous synthetic supply of the system’s reserves. As a result, credit that can be exchanged for a fixed weight of gold regularly leads to a monetary discount whereby the value of gold is suppressed by the value of credit. In other words, if the value of credit that trades as currency is tied to a weight of physical gold, the creation of credit in the banking system leads to physical gold trading at a monetary discount. When gold trades at a monetary discount, the rational response has always been to take possession of the gold, leaving behind only the collapsing credit claims.

With this in mind, is it any wonder that nations like China, Russia and India are accumulating physical gold at an astronomical pace? And what about the global central banks—why are they purchasing physical gold hand over fist?

HOW ARE PRECIOUS METALS DIFFERENT THAN FINANCIAL ASSETS?

Precious metals, such as gold and silver bullion, can sometimes be preferable to financial assets due to their lack of counterparties. Securities, derivatives, and ETF products can be complex and opaque products with associated counterparties which brings a degree of risk with them. This is why Swiss bankers have traditionally advised their clients to hold a minimum of 10% in tangible assets, such as allocated gold bullion. By investing in tangible investments in your Clear Title Account you hold legal title of your assets without counterparty risk.

Gold bullion has a millennial record as a store of value and remains the most widely recognized and universally accepted valuable in the world. It is the only tangible, non?financial asset that is always liquid and practical to own without involving the financial system. This unique combination of liquidity and independence from currencies and financial institutions is why central banks around the word hold a portion of their reserves in physical gold.

Such diversification makes perfect sense ? “reserve” is something one must rely upon if conventional arrangements fail to perform, which is why reserve holdings must be fully de?correlated from the risks inherent in conventional arrangements. In the case of investment portfolios, “conventional arrangements” revolve around financial assets, currencies and the financial system.


WHY NOT INVEST IN GOLD USING SECURITIES OR DERIVATIVES?

Financial derivatives, such as futures and options contracts can be highly complex, opaque and involve a great deal of hidden leverage. Derivatives are contracts between two parties for speculation or hedging. Investing in gold derivatives is a speculation on the movement of the gold price and not an investment in the metal itself. Problematic risk considerations include:

  • Excessive amounts of leverage to gold prices
  • Problematic volatility above the live gold price moves
  • Complications and delays of opening professional brokerage account
  • Owning a derivative not physical gold bullion
  • Broker and default risk

Gold is not a paper credit. It is not a contract for future settlement. It is not a position in a highly leveraged trading structure. Gold is a real and tangible asset. All paper-credits and investment securities are actually a short position on physical gold.

The vast majority of wealth today remains concentrated in financial instruments within a highly correlated system that is vulnerable to financial and systemic failures. In the event of another systemic shock, any and all contracts will be swept along within the consequent financial and economic upheaval. It makes no difference if they are contracts for gold, currencies, bonds, or stocks. All of them will lose value since they are tightly bound within our highly correlated and counterparty dependent system.


WHY SHOULD I USE PRIVATE CLIENT BULLION AND NOT JUST BUY GOLD EXCHANGE TRADED FUNDS (ETFS)?

Precious metals ETFs should be viewed as investments that track the price of bullion. They may be useful for speculation but they do not offer ordinary investors title to a specific quantity of allocated gold, or physical delivery options. This exposes you to counterparty risk, which is inherent to “paper gold” products. In contrast, holding gold or silver in a Clear Title Account is free of counterparty risk.

It should be noted that you are not actually purchasing the bullion nor can you ever redeem the full underlying value of your shares in physical bullion with an ETF. In addition, you may be paying a significant premium when you purchase these investments.

There are other risks involved with ETFs that include lack of transparency, lack of answerability and possible asset exposure due to the fact that the bullion is usually not insured. It is highly recommended that, prior to investing, you become familiar with the risks involved with these trading vehicles by reading the risk disclosure statements contained in their prospectus. The ETF structure has never been fully stress tested and your gold investment can have as many as four financial counterparties associated with it. These problems, amongst others, could put your assets at risk when you need them most and would therefore invalidate the very reasons for owning bullion as a hedge in the first place.


ADDITIONAL RESOURCES:

WHY USE PRIVATE CLIENT BULLION AND NOT SPREAD BET ON THE GOLD PRICE?

A leveraged bet on the gold price with a financial counterparty is very different and perhaps far more speculative than owning physical gold bullion. When the gold price is volatile such a degree of leverage can quickly work against you.

A spread-bet may not be a sensible way to invest in gold, because all you own is an electronic bet on the gold price without owning the tangible asset. Individuals typically look to buy gold bars to diversify away from the counterparty risk of the financial system.


ADDITIONAL RESOURCES:

WHY NOT INVEST IN GOLD MINING SHARES INSTEAD OF PHYSICAL GOLD?

Owning gold mining shares is sometimes suggested as a way to invest in gold. It is cited as a way to achieve leveraged exposure to the gold price. However owning shares of a gold mining company is very different than owning allocated physical gold bullion. When you own a gold miner you are exposed to a range of new risks.

  • Exploration risk: the risk that the gold miner is very poor at finding gold reserves.
  • Extraction risk: the risk that the gold miner may have lower quality gold mineral reserves than thought, and that it may be more difficult than planned to get these gold ounces out of the ground.
  • Jurisdictional risk: the risk that the authorities in the countries the gold mines are located in will prevent your company from getting its gold bullion to market.
  • Management risk: the risk that the management of the gold mining firm is fraudulent or poor at growing the company and the share price.
  • Energy and input costs: the main costs of gold mining are the costs of energy and mining equipment. When the prices of oil and steel go up this can seriously affect the profit margins of gold miners.
  • Exchange rate risk: exchange rate movements can greatly affect mine profitability by creating currency translation adjustments. This could wipe out the profits you hoped to realize.
  • Lack of dividend: gold miners have typically been very poor at issuing dividends to supplement the performance of their share price. This has helped to limit the popularity of gold mining shares as institutional investors looking for a yield on their gold investment have stayed away.

If you are looking to invest in gold for security and diversification, owning gold mining shares may be too speculative.


ADDITIONAL RESOURCES:

WHY IS OPENING A CLEAR TITLE ACCOUNT BETTER THAN BUYING GOLD COINS?

Some investors buy gold coins that they keep in their personal possession for emergencies, but investing in bullion on a secure platform may be a better option for a more substantial gold investment. Coins allow you to own gold and silver in a defined, small form. Coins held in your own possession are instantly accessible should the immediate need arise, making them a form of financial catastrophe insurance. However, due to the manufacturing (minting and fabrication) and shipping costs, purchasing gold and silver in the form of coins is considerably more expensive per ounce to purchase than the larger bullion bars. This added margin is usually lost should you decide to resell those coins. As with any valuable, there are safety, storage and liquidity issues to be considered.

Under the Currency or Coinage Acts of most nations, the government (and/or central bank) at all times directly owns the coins and notes issued in that country. This means that if you purchase a bullion (gold or silver) coin issued by a government, you are only the BEARER of the coin, and never the outright owner. The issuing government owns the coin. Should the government decide to recall that coin, which they can do at any time they wish, they will pay you for the face value of the coin, and not its true metal value. Governments have a long history of recalling bullion coinage when their economies head into rough times, a recent example in the western world being 1933 in the US.

Though it might be wise to hold gold and silver coins at home for emergencies, investing in bullion on our secure platform is a better option for more substantial gold and silver investments. Your investment is made more efficient since we give you the ability to buy and sell on the Primary Market at the Spot Market price. Coin dealers will reference the spot price in their calculations but they often add a substantial premium on purchases and a substantial discount on sales. When you use your Clear Title Account, you get more gold for your money when you buy, and more money for your gold when you sell.

Your investing through our Clear Title Program makes your gold and silver investment highly liquid since you can buy and sell in the global market with a two-day settlement period.


WHY SHOULD I INVEST IN GOLD THROUGH PRIVATE CLIENT BULLION INSTEAD OF GOING TO A DEALER?

Strategic Gold Corporation offers you the simplest, most convenient and cost-efficient way to purchase, store and sell your investment grade Good Delivery Standards bullion bars of gold and silver. Dealers typically do not offer storage facilities for your bullion. You would have to store your bullion at home or in a safety deposit box. Either way your bullion is at risk and is usually uninsurable.

Furthermore, every sound investment must be made with consideration for an exit strategy. If you decide to sell your bullion, it will require a costly re-assay in order to be sold. In addition, you may not receive a fair price for your bullion assets. Because Strategic Gold stores your bullion in a certified LBMA vault thus guaranteeing that the Chain of Integrity is not broken, the provenance of your bullion holdings are assured and your bullion is completely liquid meaning it can be instantly sold without the need to re-assay.

WHAT IS MEANT BY CLEAR TITLE OWNERSHIP?

Clear Title Ownership means that you have exclusive, direct, good and marketable legal title to your gold and silver that we administer in your Clear Title Account. Moreover, you enjoy the unfettered right to sell or take delivery of your bullion at any time. We take pride in the fact that the full accessibility and liquidity that you enjoy in your Clear Title Account is always maintained within a transparent environment of absolute security. There are no complicated or vaguely defined collateral relationships.

Strategic Gold warrants that with each bullion bar purchased and stored, a Clear Title is issued verifying the Accountholder’s ownership of specific bullion by weight, hallmark, purity and serial number. Our process ensures that each bar is wholly and exclusively allocated to the owner. This sets Strategic Gold apart, because much of the world’s precious metal purchased or traded today is stored in unallocated or pooled accounts. In the event of a bankruptcy of the custodian, the holders of unallocated or pooled bullion would become unsecured creditors. Since Strategic Gold’s allocated bars ensure that title of the bullion is assigned to the owner from the moment it is purchased to the moment in which it is sold, allocated bullion cannot form part of Strategic Gold’s assets or the custodian’s assets, and therefore is not subject to any third-party claims.


ADDITIONAL RESOURCES:

DOES MY CLEAR TITLE ACCOUNT WORK LIKE A REGULAR BANK ACCOUNT?

No. There is a very important difference between your Clear Title Account and a bank account.

Most investors worldwide incorrectly believe that when they deposit their money into a bank account, the bank is simply safe-keeping that money. The reality is quite different. Money deposited into a bank account becomes the legal property of the bank. The bank accountholder has lent the bank his money and through that act has become an “Unsecured Creditor” of the bank.

All contracts with commercial banks explicitly state that deposits of funds are a full title transfer of ownership to the financial institution. The fact that funds can be ‘repaid’ to you ‘on demand’ is incidental. When you make any bank deposit, you are giving up title to your funds to the bank, and the bank may do what it pleases with those funds. Your funds become the immediate property of the bank, in return for what is essentially an IOU.

With your Clear Title Account, you always maintain exclusive, direct, good and marketable legal title – Clear Title – to your gold and silver assets. Your specifically identified bullion assets always remain your exclusive property; we simply administer them on your behalf and according to your instructions.

Today more than ever, it is extremely important for all investors to look at the meaning of ownership in investing. We believe that a vast majority of wealth is highly vulnerable to financial failures and systemic risks.

To protect capital, we believe that prudent portfolio allocation and wealth stewardship must include gold that is owned outright and held outside the financial system.

WHAT IS A CLEAR TITLE ACCOUNT’S LEGAL STRUCTURE?

The Clear Title Account is founded on the common law principle of bailment. Every prospective Clear Title Account owner must complete an Application and execute a Bailment Agreement with the Company. In executing the Account Agreement which includes the Application, Supplemental Identification Documents and the Bailment Agreement, the Clear Title Account owner agrees to the Terms and Conditions of the Clear Title Account ProgramTerms and Conditions of the Clear Title Account Program. All bullion held in a Clear Title Account is the exclusive property of the account owner. A Clear Title Account’s direct ownership of the specific bullion in the account is never in doubt. Through the Bailment Agreement, Strategic Gold is able to take possession of the Clear Title Account owner’s bullion for the sole purpose of administering the bullion.

Bailment is defined as the temporary placement of control over or possession of personal property by one person, the bailor (you), into the hands of another, the bailee (Strategic Gold), for a designated purpose upon which the parties have agreed. The term bailment is derived from the French bailor, “to deliver.” It is generally considered to be a contractual relationship since the bailor and bailee, either expressly or impliedly, bind themselves to act according to particular terms. The bailee receives only control or possession of the property while the bailor retains the ownership interests in it. During the specific period a bailment exists, the bailee’s interest in the property is superior to that of all others, including the bailor, unless the bailee violates some term of the agreement. Once the purpose for which the property has been delivered has been accomplished, the property will be returned to the bailor or otherwise disposed of pursuant to the bailor’s directions.

The requirement that the bailee have physical possession of the property is interpreted to mean either actual or “constructive” possession. While the vault custodian has actual possession, Strategic Gold Corporation has constructive possession because it has exclusive control over what a custodian/vault facility can do with it.


WHAT IS REQUIRED FOR THE ESTABLISHMENT OF A BAILMENT CONTRACT?

Three elements are generally necessary for the existence of a bailment: delivery, acceptance, and consideration.

  • Actual possession of or control over property must be delivered to a bailee in order to create a bailment. The delivery of actual possession of an item allows the bailee to accomplish his or her duties toward the property without the interference of others. Control over property is not necessarily the same as physical custody of it but, rather, is a type of constructive delivery. The bailor gives the bailee the means of access to taking custody of it, without its actual delivery. The law construes such action as the equivalent of the physical transfer of the item.
  • A requisite to the creation of a bailment is the express or implied acceptance of possession of or control over the property by the bailee. A person cannot unwittingly become a bailee. Because a bailment is a contract, knowledge and acceptance of its terms are essential to its enforcement.
  • Consideration, the exchange of something of value, must be present for a bailment to exist. Unlike the consideration required for most contracts, as long as one party gives up something of value, such action is regarded as good consideration. It is sufficient that the bailor suffer loss of use of the property by relinquishing its control to the bailee; the bailor has given up something of value—the immediate right to control the property.

WHY IS BAILMENT IMPORTANT?

Simply put, through bailment, your specific physical bullion is your outright property. The specific bullion (identified by hallmark, weight, purity and serial number) is your personal property and is safeguarded by fundamental property rights through the bailment agreement.

In law, a bailment is restricted to physical goods which can be owned outright through possession. Therefore, entitlements evidenced by stock certificates, trust deeds,  unallocated accounts, futures or other bookkeeping entries do not grant the basic property rights that a bailment confers, because the actual value of what is owned is abstracted from the paper itself.

Private Client Bullion has structured your Clear Title Account as a bailment for the purpose of arranging the strongest and simplest legal protection for your bullion within a professional bullion vault, and for no other reason.

Owning bullion in this way gives you the soundest protection from the unlikely event of Private Client Bullion’s insolvency or the insolvency of a Custodian.

WHAT ARE THE ADVANTAGES OF CLEAR TITLE OWNERSHIP?

Your Clear Title Account enables you to maintain liquid reserves that, unlike financial claims, do not rely on financial counterparties or functioning capital markets. You can tailor the geographic diversification of your assets by allocating your physical bullion holdings across non-financial vaults of your choice in Canada, Switzerland, and the United States.

By owning physical gold or silver outside of the financial infrastructure in your Clear Title Account you enjoy:

You can rest easy knowing that you remain in control of your assets at all times. Your gold remains free of credit or counterparty risk, is always liquid and is insured and audited.

WHAT KINDS OF RISKS DOES MY CLEAR TITLE OWNERSHIP PROTECT ME FROM?

The Clear Title Account Program addresses liquidity risk, leverage risk, market risk, counterparty risk, operational risk, and compliance, legal and regulatory risk. Below is a description of how each risk has been addressed by Private Client Bullion within the Clear Title Account Program:

  • Liquidity Risk: the ability to convert bullion to cash. All gold and silver bullion purchased in a Clear Title Account is investment grade bullion held within the LBMA Chain of Integrity. Bullion is one of the most liquid assets available and can be quickly sold into the global Primary Market for cash settlement on a T+2 basis.
  • Leverage Risk: the practice of using borrowed funds to trade and invest. A Clear Title Account is not a security. All bullion owned in a Clear Title Account is the sole and exclusive private property of the account owner. Strategic Gold Corporation does not engage in any derivative, hedging, or leveraging activities. Clear Title Account ownership is held directly in the account owner’s name.
  • Market Risk: the financial risk resulting from changes in the market price of bullion. The gold and silver markets are one of the largest and deepest capital markets in the world. Bullion trades daily across the globe. Gold is considered to be both a global reserve asset and a safe haven asset.
  • Counterparty risk: the risk of loss due to the change in creditworthiness or solvency of brokers, custodians, trading, and depositor counterparties, as applicable. A Clear Title Account conveys direct ownership of the bullion holdings owned in the account. There are no unallocated or pooled accounts in the Clear Title Account Program. Each bullion bar is fully allocated to one Clear Title Account. They are the legal property of the Clear Title Account owner and defended by private property and bailment law. No third party including the Company and the vault custodian or either of their creditors retain any claim against a Clear Title Account’s bullion holdings. Neither Strategic Gold nor the custodial vaults keep and Clear Title Account assets on their own balance sheets. In the unlikely event that Strategic Gold or one of the Company’s custodial vaults was to become insolvent, no one other than the Clear Title Account owner(s) has a claim to the bullion.
  • Operational Risk: the risk resulting from inadequate or failed internal processes, people, systems, or from external events. Strategic Gold works on an agency basis and does not take any proprietary risk on transactions. The Company is not a market maker or broker-dealer. Pursuant to its organizational charter, the Company does not engage in speculative trading or market making activities. Strategic Gold has engaged two independent auditing firms to oversee the implementation of our extensive internal and externals controls in order to provide a Clear Title Account owner with the assurance that both their cash and bullion assets are always secure. The Company has established relationships with Best-in Class bullion trading partners, auditing firms, legal firms, and custodial vaults. Our custodial safeguards include full insurance coverage for each and every bullion bar administered by the Company in the Clear Title Account Program.
  • Compliance, legal and regulatory Risk: the risk of loss resulting from litigation or regulatory non-compliance. Direct ownership of physical gold and silver bullion in a Clear Title Account is not ownership of a security. As a result it is not subject to changes in regulatory oversight by the U.S. Securities and Exchange Commission (“SEC”) or the U.S. Commodity Futures Trading Commission (“CTFC”).

A Clear Title Account owner has direct, exclusive ownership of a specific, highly liquid, real asset that is held outside of the financial system so as to provide insurance to that Clear Title Account owner against the systemic risks inherent within the global financial system.

HOW SAFE IS THE CASH IN MY CLEAR TITLE ACCOUNT?

Private Client Bullion accepts a duty to receive, hold and maintain funds received from you directly into a segregated Private Client Bullion Account maintained at the bank for the express purpose of safeguarding uninvested Client money. Private Client Bullion confirms that the bank has acknowledged and accepted that the money in the Private Client Bullion Client Account is held under a dual signature control by Private Client Bullion and is reviewed by the Independent Transaction Auditor. The bank has further acknowledged and accepted that it is not entitled to combine this account with any other Private Client Bullion corporate account or to exercise any right of set off or counterclaim against money in this account in respect of any money owed to the bank on any other Private Client Bullion corporate account.

On your behalf Private Client Bullion is permitted to manage your money in the segregated Private Client Bullion Account exclusively for the following purposes:

  • It may be used to buy physical bullion from the recognized bullion market on your behalf, where you have exercised your right to participate in the bullion market.
  • It may be used to pay withdrawals of your money back to you – without delay, upon your written instructions.

The Private Client Bullion Account statement from the bank shall be fully reconciled to Strategic Gold’s own records every banking day.

Private Client Bullion undertakes to operate robust internal controls such that payments of Client money upon withdrawal get authorized only when at least 2 senior officers of Private Client Bullion have inspected and approved the payment instructions. Cash movements are further secured through the employment of our Independent Transaction Auditor’s oversight.

Private Client Bullion undertakes to maintain at all times within the segregated Private Client Bullion Account sufficient funds to pay back the gross credit balances of all Private Client Bullion Clients, and to have that money held at call for return, if requested, on the same business day. As with any bank deposit, cash in the client account is potentially exposed to a bank failure. In contrast, owning precious metals under the terms and conditions of the Private Client Bullion Bailment Agreement eliminates this risk.

WHAT KIND OF CONTROLS ARE VERIFIED IN THE TRANSACTION AUDITOR’S REPORT?

The Company has engaged an Independent Transaction Auditor to perform a regular periodic review of the following control procedures:

  1. Verification that all client cash deposits into the Northern Trust Client Cash Account were posted appropriately to the correct client account on the Precious Metals System.
  2. Verification that all client cash withdrawals (including wire fees) out of the Northern Trust Client Cash Account were posted appropriately to the correct client account on the Precious Metals System, agreed with written instructions received from the client, and were properly authorized by the client.
  3. Verification that all client cash purchases of precious metal products were properly withdrawn from the appropriate client account on the Precious Metals System, agreed with written instructions received from the client, and were properly authorized by the client.
  4. Verification that all client cash sale proceeds of precious metal products were properly deposited into the appropriate client account on the Precious Metals System, agreed with written instructions received from the client, and were properly authorized by the client.
  5. Verification that the daily administration fee was properly accrued in each client account on the Precious Metals System during the previous quarter. In addition, verify that the administration fee withdrawn from the client accounts on the Precious Metals System followed the Terms and Conditions Agreement that was signed by the client.
  6. Verification that the transaction fees withdrawn from the client accounts on the Precious Metals System followed the Terms and Conditions Agreement that was signed by the client.
  7. Using a sample of clients’ accounts, recalculation of the clients’ accounts to insure that all cash transactions during the quarter were properly calculated, authorized, and recorded in that client’s cash account on the Precious Metals System.
  8. Verification that at the end of each month in the quarter that the ending balance in the Northern Trust Client Account reconciled to the total of all clients’ accounts in the Precious Metals System.
  9. Confirmation of the beginning and ending balance in the Northern Trust Client Account.
  10. Verification that all clients’ precious metal products were properly withdrawn from the appropriate vault facility and recorded on the Precious Metals System, agreed with written instructions received from the client, and were properly authorized by the client.

The review of these controls is conducted each quarter. Upon completion of the review, Livingston and Haynes provides the Independent Accountant’s Report on Applying Agreed Upon Procedures to the Company’s Board of Directors which details any findings.

HOW SAFE ARE THE PRECIOUS METALS IN MY CLEAR TITLE ACCOUNT?

Clear Title accountholders have OUTRIGHT and COMPLETE ownership of unencumbered, actual and specific physical bullion bars and coins.

The operation of your Clear Title Account is designed to fully protect you and your bullion holdings. Safety features have been designed to provide the greatest level of security, while maintaining the individual accountholder’s privacy, and ease of account dealings. Private Client Bullion warrants that with each bullion bar purchased and stored, a Clear Title is issued verifying the Account Holder’s ownership of specific bullion by weight, hallmark, purity and serial number. Our process ensures that each bar is wholly and exclusively allocated to the owner.

The physical bars of gold and silver, belonging to each Account Owner, are stored and separately allocated at the Secure Vault Facility chosen by the accountholder as follows:

  1. The Private Client Bullion Clear Title Account Program maintained by Private Client Bullion and the Custodian (the “Title Register”) will record the serial number, exact weight, refiner’s mark and purity of each bar held in the Clear Title Account Program; and
  2. The Owner shall have sole legal title and ownership of the gold or silver referenced on the Clear Title and Title Register and lodged in the Storage Facility;
  3. The Owner’s gold or silver may not be used by any party for any purpose during storage;
  4. The Owner’s gold or silver is not carried as an asset on the books of either Strategic Gold Corporation or the Custodian(s);
  5. In the unlikely event of bankruptcy or insolvency of either Private Client Bullion Corporation or the Custodian(s), an Owner’s Clear Title to its gold or silver is not subject to any third-party claims.

Ownership of your precious metals in The Clear Title Account Program is outright. It is not anyone’s liability. Simply put, your bullion is your outright property from the moment you buy it to the moment you sell it. The specific bullion (identified by hallmark, weight, purity and serial number) is your personal property and is safeguarded by fundamental property rights.

WHAT KIND OF CONTROLS ARE VERIFIED IN THE BULLION AUDITOR’S REPORT?

Operating within the strictest custodial guidelines, Private Client Bullion utilizes Bureau Veritas as its independent, external bullion auditors. Bureau Veritas performs a quarterly physical inventory of the gold and silver held in the Clear Title Account’s Vault Facilities.

The bullion auditors have been engaged to perform specified auditing procedures in order to ensure that each and every bullion bar administered by Private Client Bullion is physically present in the vault facility chosen by the accountholder and that each bullion bar is exclusively allocated to one specific Clear Title Account.

Bureau Veritas verifies the presence of each bullion bar by the following unique identifiers:

  • Weight
  • Hallmark
  • Purity
  • Serial Number
  • Vault Facility

The results of these quarterly audits are sent directly to each client in the form of an individual account audit report. Records of these audits are also posted to each client’s online account.

As an additional measure of security and verification of the Clear Title Program, The vault custodians issue monthly reports to Private Client Bullion that record bars added or removed from the vault and provide a complete audit trail of all holdings.

HAS THERE EVER BEEN A MATERIAL RESTATEMENT OF STATEMENTS OR PRIOR RESULTS?

No. There has never been a restatement of a Clear Title Account statement or prior results by the Company or its independent auditors.

HOW MUCH DOES IT COST TO OPEN A CLEAR TITLE ACCOUNT?

There is no cost for opening your Clear Title Account.

WHAT ARE THE DIFFERENT ACCOUNT TYPES OFFERED BY PRIVATE CLIENT BULLION?

Strategic Gold offers Clear Title Accounts for Individual, Joint, Corporate, Partnership, Sole Proprietorship, LLC, Trust and IRA accounts.


ADDITIONAL RESOURCES:

CAN I TAKE DELIVERY OF MY PRECIOUS METALS WITH A CLEAR TITLE ACCOUNT?

Yes. You can always take physical delivery of your gold and silver.

When you have made your gold and/or silver investment, Private Client Bullion can deliver your bullion into your own vault or custody upon written request. You can also take physical possession of your assets from the vault facility.

For more information about delivery of your bullion email us at accounts@strategicgold.com or speak with an account executive by calling 239 692-9154.

CAN INTERNATIONAL INVESTORS OPEN A CLEAR TITLE ACCOUNT?

Yes. Investors from any country can buy gold or silver on our platform.

Our service was designed to allow individuals from around the world to invest in gold and silver bars, securely and efficiently.

For more information about using our service as an international investor email us at accounts@strategicgold.com or speak to a client executive by calling 239 692-9154.

HOW LONG DOES IT TAKE TO OPEN A CLEAR TITLE ACCOUNT?

It only takes a few minutes to complete the Account Agreement for a Clear Title Account. There are three simple parts in the application process:

  • Fill out and submit the application
  • Submit your supplemental documentation (proof of identity)
  • Submit your signed Bailment Agreement

Click on the appropriate account type to get started now:

For more information about using our service email us at accounts@strategicgold.com or speak to a client executive by calling 239 692-9154.

HOW DOES THE ACCOUNT AGREEMENT WORK?

Ownership of your gold and silver in your Clear Title Account is outright. Clear Title Accounts are not subject to any third party, and it is not anyone’s liability. It is – quite simply – your outright property from the instant you buy it to the moment you sell it.

In accepting the Clear Title Account Terms and Conditions you have engaged Private Client Bullion as an administer of your bullion. Private Client Bullion, has subcontracted the physical custody of your bullion to the vault operators. You should also know that in their agreements with Private Client Bullion the vault operators fully acknowledge that the bullion shall remain the property of Private Client Bullion’s clients at all times.
Private Client Bullion has retained responsibility for administration and record keeping, which is performed on the Private Client Bullion Precious Metals Platform and through the Private Client Bullion Client Portal website.

These are unusually strong property rights for you because there is no intermediation via trusts or company balance sheets. The gold and/or silver is your personal property and is treated under law as a bailment.

CAN I OPEN AN ACCOUNT ON BEHALF OF SOMEONE ELSE?

Yes. You can create a Clear Title Account on behalf of someone else but the verification process involves a few additional steps. All you need to do is complete the Account Agreement as if you were the third-party in question, uploading their supplemental documentation where required, but including yourself as a “Designated Representative” on the application form and that you provide us with proof of your relationship to the third-party.

Funding such an account carries additional verification since you may be funding the account in a way not normally compatible with the linked bank account procedures that we follow.

Private Client Bullion retains the right to exercise its discretion when judging whether this account will be established.

Please contact a customer representative if you have additional questions on how to open an account on behalf of someone else. Email us at accounts@strategicgold.com or if you prefer to speak to a client executive, please call 239 692-9154.

CAN I SEND SCANS OF MY ACCOUNT AGREEMENT DOCUMENTS BY EMAIL?

Yes. To expedite the establishment of your Clear Title Account, you may submit your Account Agreement documents via email or fax.

We do require that you mail us the original signed documents within a reasonable timeframe.

You can email your Account Agreement to: accounts@strategicgold.com or you can fax your Account Agreement to 239-236-1514.

CAN I BUY PRECIOUS METALS IMMEDIATELY AFTER OPENING AN ACCOUNT?

Once your account has been established, you can fund your account via bank-wire or check. When your account has been funded, you can buy precious metals at any time.


ADDITIONAL RESOURCES:

CAN I ADD ADDITIONAL OWNERS TO MY CLEAR TITLE ACCOUNT?

Yes, you may add additional owners to your Clear Title Account.

You can add additional owners during the initial sign up process or, if you choose to add another owner to your Clear Title Account at a later stage, the person would need to submit a completed Account Agreement in their own name before being added to your Clear Title Account.

Once the Account Agreement has been verified, we will request that both you and the additional person send a letter requesting to add the additional owner to your Clear Title Account.

If you have any questions, please do not hesitate to contact one of our account executives by email at accounts@strategicgold.com or by calling 239 692-9154.

HOW DO I ADD A BENEFICIARY TO MY HOLDING?

To add a beneficiary to your Clear Title Account you will need to submit a completed and signed Beneficiaries Form to your account representative. To request this form, please email accounts@strategicgold.com or call 239 692-9154.

HOW DO I OPEN AN ACCOUNT FOR MY CHILDREN IF THEY DO NOT HAVE GOVERNMENT ID?

If your children are under 18, please open a Clear Title Account in the names of yourself and your child. As an identity document for your child, please submit a copy of his or her birth certificate.

If you already have a Clear Title Account, we can use your documents already on file. Please advise us of your Clear Title Account number when submitting your child’s birth certificate.

If you have any questions, please do not hesitate to contact one of our account executives by email at accounts@strategicgold.com or by telephone at 239 692-9154.

I AM HAVING TROUBLE DOWNLOADING THE ACCOUNT AGREEMENT. WHAT SHOULD I DO?

Please make sure you have downloaded and installed the latest version of Adobe Acrobat Reader. This is a free program available from the Adobe website.

You can always email us at accounts@strategicgold.com or call us at 239 692-9154 to request an Account Agreement. We will be happy to send you one.

IS THE ACCOUNT AGREEMENT REQUIRED FOR ALL CUSTOMERS?

Yes. Private Client Bullion’s Clear Title Account Customer Agreement is required for all customers. Our Account Agreement is designed to:

  • Prevent Private Client  Bullion from being used as a money launderer;
  • To satisfy Know-Your-Customer best practices; and
  • To ensure that each of our clients enjoys the strongest property rights for their Clear Title Account holdings.

The above objectives are accomplished by requiring all new clients to submit a completed Account Agreement.

WHAT INFORMATION DO YOU COLLECT TO VERIFY MY IDENTITY?

We collect the following information for all accounts, if applicable, for any person, entity or organization who is opening a new account (or is being granted authority over a new or existing account) and whose name is on the account or has authority over the account:

  • 1. the legal name of the Client;
  • 2. the mailing address of the Client;
  • 3. the date of birth of the Client.

Recognizing that different types of accounts trigger different requirements, we will gather the additional information specified below for each of the following categories of accounts we provide:

  • Individual Accounts – We will obtain the Client’s bank account information.
  • Non-U.S. Person Accounts – We may inquire further information depending on a number of factors, such as the country of origin of the account holder or persons authorized to use this service.
  • Domestic Operating or Commercial Entities – We will collect information sufficient to determine the corporate or business entity’s identity, and the authority of its business representative to act on its behalf.
  • Domestic Trusts – We will identify the trustee, the activity the trust authorizes, and the authority of the trust’s representative to act on its behalf.
  • Institutional Accounts, Hedge Funds, Investment Funds and Other Intermediary Relationships – While our AML procedures cover institutional Clients, we recognize that certain types of institutional accounts are different from retail accounts. Institutional accounts often are opened for financially sophisticated clients who trade frequently, in volume, and usually through an intermediary, some of whose AML policies and procedures are sufficient and verifiable. In addition, in determining whether it is necessary to identify the investors of non-U.S. institutions, we will consider the regulation of the institution by its home country and whether the institution is located in a bank secrecy haven or a non-cooperative country.

WHAT DOCUMENTS ARE ACCEPTABLE FOR THE PHOTO ID REQUIREMENT?

Any of the following documents are acceptable for the photo ID requirement:

  • Driving license
  • Passport
  • Any other official government issued form of identification

Please make sure that:

  • The photocopy is clear so that the facial features in the picture are clearly visible.
  • The document is issued by a government agency.
  • The ID document has not expired.

WHERE DO YOU KEEP MY ACCOUNT AGREEMENT INFORMATION?

At Strategic Gold we are focused on delivering complete client satisfaction, which includes respecting client privacy. As part of this approach, clients are not identified by name to Partner companies that deliver services to the Clear Title Program. Furthermore, client information will never be used for marketing purposes or shared with any third party organization.

Strategic Gold places special importance upon client confidentiality. All client information is encrypted and stored on our secure servers. These servers are physically isolated and cannot be accessed through the Internet. Redundant backups are stored offsite in a secure facility. To ensure discretion and confidentiality, all statements and transactions are processed on our system by coded client identification number.

WHO CAN BE GIVEN ACCESS TO MY PERSONAL INFORMATION?

The Clear Title Program fully protects our clients’ identity and bullion holdings. Your information is kept at our corporate office in Naples, Florida. This information will not be released for marketing purposes or shared with any third party organization.

If you hold an interest in a Clear Title Account jointly with one or more other persons, you alone have the right to make the decisions concerning the use of Personal Information that pertains to you alone. You and the other person or persons, each acting alone, have the right to make decisions concerning the use of the information that pertains to you together.

WHY DOES PRIVATE CLIENT BULLION REQUIRE ME TO SUBMIT MY BANK ACCOUNT INFORMATION?

Private Client Bullion must comply with established ‘know-your-customer’ regulations in order to satisfy both our own ethical standards and the law. These regulations help prevent Private Client Bullion from being used in illegal activities.

By requiring all our clients to link a bank account to their Private Client Bullion Clear Title Account we are accomplishing two important objectives:

  • We are verifying the identity of our clients; and
  • We are safeguarding our clients’ wealth.

Your Clear Title Account is designed to be a very secure home for legally acquired wealth. It is not a useful or secure resource for money launderers. In order to repel money launderers we require that all incoming monies come from a source which has been properly validated.
Private Client Bullion’s operational platform will not permit value in the form of money or bullion respectively to be transferred away from your Clear Title Account without reasonable return of value in the opposite form (bullion or money respectively).

You are entitled to rely on this protection such that if illicit access to your account were to occur a criminal could not transfer your property to their own control except by benefiting your account with the proceeds equivalent to a fair trading price.

HOW DO I DEPOSIT FUNDS INTO MY CLEAR TITLE ACCOUNT?

Once your Clear Title Account has been established, you can fund your account at any time. You can fund your account by initiating a wire transfer from your Bank Account of Record or alternately, you can fund your account using a check. We do not accept cash.
Your Clear Title Account must be funded through your linked Bank Account of Record.

You will receive our bank details and a reference number to be used in funding your account when your Clear Title Account is opened. Please remember to use this reference number when funding your Clear Title Account to ensure that when your funds clear in our bank account, your account can be credited accordingly.

A wire transfer is usually received on the next business day. Checks usually clear within 3-6 business days. We will inform you by email once your funds are credited to your Clear Title Account.

To request our wire instructions, please contact us via email at accounts@strategicgold.com or call us at 239 692-9154.

AM I SENDING FUNDS OUTSIDE THE UNITED STATES?

No, all funds are sent to a bank account within the United States.

CAN I FUND MY ACCOUNT FROM A DIFFERENT BANK ACCOUNT THEN THE ONE ON RECORD?

No. When making a deposit into your Clear Title Account, funds must originate from your Bank Account of Record. However, you do have the ability to link multiple bank accounts to your Clear Title Account. Each of these accounts must be verified prior to being used as a source of funding.

You can either delete existing Bank Account of Record details or simply add another Bank Account of Record to your Clear Title Account.

To request an amendment to your Bank Account of Record, please contact us via email at accounts@strategicgold.com or call us at 239 692-9154.

CAN I USE MULTIPLE BANK ACCOUNTS TO FUND MY ACCOUNT?

Yes, provided these accounts have been added to your Bank Account of Record details prior to the deposit being made.
The general guidelines for linking a bank account to your Clear Title Account are:

  • Individual Accounts: We can only accept funds from a bank account held in your name. Your name must appear on the bank details of the wire transfer.
  • Joint Accounts: We can accept funds from bank accounts owned separately or severally. Your name(s) must appear on the bank details of the wire transfer.
  • Corporate Accounts: Transfers to Corporate Accounts must come from a bank account in the name of the company. The company name must appear on the bank details of the wire transfer.

If your name is not on the wire details that we receive from your bank, we may need to contact you to request a bank document that confirms that the funds come from a bank account in your name. If the originating bank account is held in a different name than your Clear Title Account, we may have to return your funds.

CAN I FUND MY CLEAR TITLE ACCOUNT WITH CASH?

No. Strategic Gold requires that all incoming monies come from a source which has been validated in the banking world. Each account only accepts monies from its Bank Account of Record, and only remits funds back to that Bank Account of Record.

WILL I GET PRECIOUS METALS FOR THE EXACT AMOUNT THAT I FUND MY ACCOUNT?

Acting upon your written purchase instructions and as your agent in the Primary Bullion Market, we will purchase a total number of ounces – up to the nearest dollar amount that you have instructed – after deduction of any applicable transaction fees.

Any cash balance in your favor will be reflected in your Clear Title Account and can be refunded to your Bank Account of Record upon your request.

DO YOU PAY INTEREST ON THE CURRENCY BALANCE IN MY CLEAR TITLE ACCOUNT?

No. Interest is not paid on cash balances held in clients’ Clear Title Accounts.

HOW CAN I RETRIEVE THE WIRE TRANSFER INSTRUCTIONS TO ADD FUNDS TO MY ACCOUNT?

To request our wire instructions, please contact us via email at accounts@strategicgold.com or call us at 239 692-9154.

HOW DO I CHANGE MY BANK ACCOUNT DETAILS?

You can either delete existing Bank Account of Record details or add another Bank Account of Record to your Clear Title Account.

To do so, please request a Bank Account of Record Form from one of our account representatives at accounts@strategicgold.com or call us at 239 692-9154

Please note: Changes to your Bank Account of Record details require verification by Private Client Bullion. This verification usually takes place within a few hours but it may take up to one business day.

HOW DO I REMOVE FUNDS FROM MY CLEAR TITLE ACCOUNT?

Clear Title accountholders can withdraw funds from their account at any time during regular business hours.

There is a $60.00 fee to disburse money from your Clear Title Account to your linked Bank Account of Record via bank wire. There is no fee for disbursements via check.

To request a disbursement, please submit a request in writing to accounts@strategicgold.com. For assistance, please call us at 239 692-9154.

HOW LONG WILL IT TAKE FOR STRATEGIC GOLD TO SEND MONEY BACK TO MY BANK ACCOUNT?

Private Client Bullion processes  disbursement requests on the same day that they are received. When a request for disbursement via check is made, the check is mailed on the same day as the disbursement request.

When a request for disbursement via bank wire is made, requests received before 4:00 p.m. EST will be processed the same day and requests received after the 4:00 p.m. cut-off time will be processed the following business day. Bank wires are generally received within 1-2 business days, but can take longer depending upon your bank’s location (i.e., some international bank wires may take 3-4 days before the proceeds appear in your account).

CAN I HAVE MONEY DISBURSED FROM MY ACCOUNT TO A BANK ACCOUNT NOT ON RECORD?

No. All funds that leave your Clear Title Account can only be sent to your linked Bank Account of Record.

You can always add another Bank Account of Record to your Clear Title Account. To do so, please request a Bank Account of Record Form from one of our account representatives at accounts@strategicgold.com or call us at 239 692-9154

Please note: Changes to your Bank Account of Record details require verification by Private Client Bullion. This verification usually takes place within a few hours but it may take up to one business day.

IS THERE A LIMIT ON HOW MUCH MONEY I CAN SEND TO MY CLEAR TITLE ACCOUNT?

No. You can add any amount, and at any time ask that the entire balance in your Clear Title Account or any part thereof be transferred back to your Bank Account of Record. There are no lock-up periods or restrictions.

WILL THE CASH IN MY CLEAR TITLE ACCOUNT SHOW UP ON MY STATEMENTS?

Yes. Your statements will always reflect your full bullion and cash assets. Likewise, when you access you account via the Clear Title Client Portal, your online account will always display your complete position (cash and precious metals) and transaction activity.

HOW SAFE IS THE CASH IN MY CLEAR TITLE ACCOUNT?

Private Client Bullion accepts a duty to receive, hold and maintain funds received from you directly into a segregated Private Client Bullion Client Account maintained at the bank for the express purpose of pooling un-invested Client money. Private Client Bullion confirms that the bank has acknowledged and accepted that the money in the Private Client Bullion Client Account is held under a dual signature control by Private Client Bullion and reviewed by the Independent Transaction Auditor. The bank has further acknowledged and accepted that it is not entitled to combine this account with any other Private Client Bullion corporate account or to exercise any right of set off or counterclaim against money in this account in respect of any money owed to the bank on any other Private Client Bullion corporate account.

On your behalf Private Client Bullion is permitted to manage your money in the segregated Private Client Bullion Client Account exclusively for the following purposes:

  • It may be used to buy physical bullion from the recognized bullion market on your behalf, where you have exercised your right to participate in the bullion market.
  • It may be used to pay withdrawals of your money back to you – without delay, upon your written instructions.
  • It may be used to pay any outstanding Administrative Services Fee.

The Private Client Bullion Client Account statement from the bank shall be fully reconciled to Private Client Bullion’s own records every banking day.

Private Client Bullion undertakes to operate robust internal controls such that payments of Client money upon withdrawal get authorized only when at least 2 senior officers of Private Client Bullion have inspected and approved the payment instructions. Cash movements are further secured through the employment of our Independent Transaction Auditor’s oversight.

Private Client Bullion undertakes to maintain at all times within the segregated Private Client Bullion Client Account sufficient funds to pay back the gross credit balances of all Private Client Bullion Clients, and to have that money held at call for return, if requested, on the same business day. As with any bank deposit, cash in the client account is potentially exposed to a bank failure. In contrast, owning precious metals under the terms and conditions of the Private Client Bullion Bailment Agreement eliminates this risk.

WHY ARE DEPOSITED FUNDS SOMETIMES RETURNED?

If we receive funds referenced correctly to a Clear Title Account, but where the bank details of the depositing account do not relate to the account holder’s Bank Account of Record, we reserve the right to return these funds. We do this to prevent money laundering. We charge a $60.00 bank wire fee for the return of these funds.

However through our communications with the accountholder, in extreme circumstances, we allow accountholders to prove legitimate source of funds. To do this a client will have to provide significant new documentation establishing the legitimacy of the fund source, which may be accepted or rejected as proper proof by two officers of Private Client Bullion.

WHAT PRECIOUS METALS PRODUCTS DOES PRIVATE CLIENT BULLION OFFER?

A wide variety of internationally recognized bullion bars and coins are available within your Clear Title Account. We make buying and selling gold easy.

SMALLER EXACT WEIGHT BARS

A variety of smaller exact weight bars is available to clients of Strategic Gold. The fine gold content of exact weight bars is determined by their fineness. A client pays only for the fine gold content.

The Primary Bullion Market offers smaller, exact weight bars, at a premium to the Spot Market Price. For example, Kilo bars (32.148 oz) generally trade at a $2 premium to Spot while one ounce bars generally trade at a $5 premium to Spot.

LARGER GOOD DELIVERY BAR

London Good Delivery: London Good Delivery Bars weigh approximately 400 oz (12.5kg). Bars must weigh between 350 oz and 430 oz (fine gold) and trade at the Spot Market Price.

Comex Good Delivery: Comex Good Delivery Bars weigh approximately 100 oz. The weight can vary between 95 oz and 105 oz (fine gold) and trade at the Spot Market Price.

Good Delivery Gold Bullion Bars are purchased at the Spot Market ‘ask’ Price.

Good Delivery Gold Bullion Bars are sold at the Spot Market ‘bid’ Price.

SILVER BULLION BARS

Silver is available in smaller denominated 1, 5, and 10 ounce bars as well as Kilo bars, 100 ounce bars, and 1,000 ounce bars.

1,000 ounce silver bars generally trade at the Spot Market Price while smaller bars generally trade at a premium to Spot.

GOVERNMENT MINTED COINS

Clients may also hold government issued gold and silver coins in their account. These include, but are not limited to, American Eagles, Canadian Maple Leafs, Austrian Philharmonics, and South African Krugerrands. Precious metals purchased through Strategic Gold are manufactured by refiners recognized by the LBMA for their production of investment grade good delivery bars. Strategic Gold offers a wide selection of gold and silver bars and coins.

WHERE DOES PRIVATE CLIENT BULLION BUY PRECIOUS METALS?

We only buy gold from an LBMA (London Bullion Market Association) approved source in the Primary Bullion Market at the internationally recognized Spot Market Price. We do not add mark-ups to your purchase price.

Clients of Private Client Bullion are able to take full advantage of “large scale” cost savings associated with buying, vaulting, insuring and reselling of their gold and silver bullion on the professional market.

We believe that clarity and trust make strong relationships. As a result, the Private Client Bullion trading platform provides its clients with the fully transparent internationally recognized Spot Market Price as it is quoted directly in the Primary Bullion Market.

HOW DO I PURCHASE GOLD THROUGH PRIVATE CLIENT BULLION?

Purchasing gold through Private Client is easy. There are 3 simple steps:

  • 1) Submit a completed Account Agreement to open a Clear Title Account;
  • 2) Fund your account; and
  • 3) Place your order.

WHAT PRICE WILL I PAY FOR MY GOLD?

The price you pay will be the widely recognized Spot Market Price of gold on the Primary Bullion Market at the time of your purchase. Private Client Bullion gives you a significant advantage of being able to buy and sell your precious metals quickly and easily within the Primary Bullion Market.

You trade at spot prices from the Primary Bullion Market as they update in real time. Our prices are live from the professional market. This means that you get the most up to date gold or silver price when you purchase precious metals in your Clear Title Account.

WHAT DOES IT COST TO BUY PRECIOUS METALS THROUGH PRIVATE CLIENT BULLION?

Your precious metal purchase is based upon the fully transparent, current Spot Market Price plus a transaction fee. There are no other hidden fees or costs.

With Strategic Gold you avoid costly shipping and handling because you are purchasing metals already stored in a vault. You also avoid the often high mark-up one must pay for bullion coins and small bars to cover the fabrication costs.

WHAT ARE THE MINIMUM AND MAXIMUM QUANTITIES I CAN PURCHASE OR SELL?

Private Client Bullion requires a minimum investment of 1 kilo bar for new accounts. Subsequent purchases can be made in increments as small as one ounce. Beyond that, there is no minimum or maximum order amount, which means you can purchase or sell as little or as much as you want.

There are no restrictions or lock-up periods on sales. Your Clear Title Account assets are your property and you can add to them or liquidate them whenever you want.

WHEN WILL YOU BUY MY PRECIOUS METALS?

Once you have submitted your Account Agreement and funded your account, you may begin to purchase gold or silver anytime. We will always follow your written order entry instructions. Market orders will be executed immediately. You will receive a written confirmation of your purchase upon the execution of your trade.

You will also be able to view your updated account details through the Client Portal at the end of each day. To view your transactions simply log into your Clear Title Account.

HOW CAN I PROVE THAT I OWN THE GOLD THAT I HAVE JUST PURCHASED?

As soon as you have transacted your purchase, you will receive a confirmation from Private Client Bullion giving you details of the cost of the bar(s) purchased and the balance (if any) to be refunded to your account.

Upon settlement, two business days after your purchase has been transacted, Private Client Bullion will issue your Finalized Transaction Receipt that will identify your specific gold bars by weight, purity, hallmark and serial number.

You will also be able to view your updated account details through the Client Portal at the end of each day. To view your account details, transactions, specific bar details and activity, simply log into your Clear Title Account.

HOW DO I KNOW THAT I AM BUYING LEGITIMATE AND PURE GOLD OR SILVER?

Private Client Bullion ensures the integrity, purity and quality of the metals purchased on its platform. Private Client Bullion only purchases gold and silver from the Primary Bullion Market. Therefore, all precious metals are investment grade according to the strict criteria of the “Good Delivery” Chain of Integrity. The gold and silver bullion on our platform is bullion recognized and accepted by the professional markets.

The good delivery bars which Private Client Bullion purchases on your behalf are guaranteed at a purity of at least 99.5% pure gold or better. These good delivery bars are then held in LBMA accredited professional vault facilities. When you own metals using your Clear Title Account, the metal does not leave the Chain of Integrity, so when you decide to sell, the quality of your assets is guaranteed. This ensures that your investments in precious metals through your Clear Title Account are 100% legitimate.

Furthermore, every bullion bar you own has 4 distinct qualities:

  • a) a specific weight;
  • b) a specific purity or fineness;
  • c) a specific refiners mark; and
  • d) a specific serial number.

No two bullion bars are the same. Therefore, the gold that you hold direct title to is recorded in our registry by its distinct combination of these four qualities. Moreover, an independent audit is conducted every quarter by Bureau Veritas, where each bar is accounted for by its unique combination of these 4 qualities and allocated to one specific Clear Title Account. Results of these audits are mailed to each accountholder every quarter. These audit results are also posted to each accountholder’s online account.

IS THE GOLD I OWN CLASSIFIED AS ‘INVESTMENT GOLD’?

Gold is classified in a variety of ways in various jurisdictions throughout the world. It does maintain a special position within certain tax jurisdictions. For example, people who buy gold bullion bars for ‘investment purposes’ within the European Union do not incur Value Added Tax (VAT). VAT is considered a tax on consumption. Good delivery gold bullion is considered an investment metal in the UK, the EU and in Switzerland. Therefore, Clear Title accountholders from these jurisdictions can buy and sell gold using Private Client Bullion’s Clear Title Accounts without incurring VAT.

In the United States, physical gold ownership is not considered an ‘investment’. Rather, it is a real asset and a collectible.

Since we are not in existence to assist tax avoidance or to provide tax advice, you should not exclusively rely on our commentary concerning this subject. We recommend that you consult your tax advisor on this issue before opening a Clear Title Account.

WHAT IS THE FINENESS/PURITY OF THE BARS?

All bars available for purchase and/or delivery are in a purity range of 99.95-99.999. Clear Title accountholders can request bars of a specific fineness/purity as part of their purchase instructions.

WHAT IS THE QUALITY OF THE SMALL BARS?

All small bars are cast bars by LBMA credentialed refiners. Clear Title accountholders can request bars of a specific hallmark or purity as part of their purchase instructions. We will be happy to advise you as to the availability of these bars.

ARE MY PRECIOUS METALS INSURED?

All precious metals held in your Clear Title Account are insured to their full market value against all insurable risks, including theft. Your assets are stored in professional vaults using specialist vaulting companies. These are vaults recognized by the international exchanges of the wholesale markets and the London Bullion Market Association (LBMA). Our preferred vaulting partner is Loomis International. This professional vault operator provide insurance for all assets held in custody.

This storage provider is the best at what it does, and its exemplary security records and economies of scale mean that it is also able to insure itself, and therefore you, at an extremely competitive cost. You benefit from a far smaller insurance cost per unit, than those incurred with private custody and other forms of storage. The cost of insurance coverage is included in our very competitive administrative fee.

CAN I DEPOSIT PHYSICAL GOLD AND SILVER THAT I ALREADY OWN INTO MY ACCOUNT?

Yes you can. We can organize secure transport from anywhere in the world; from a bank, from a bullion vault, or from Comex.

To request a transfer, please contact us via email at accounts@strategicgold.com or call us at 239 692-9154.

HOW DO I SELL MY PRECIOUS METALS AND RECEIVE THE FUNDS?

Private Client Bullion gives you access to the Primary Bullion Market – one of the deepest capital markets in the world – you will receive the Spot Market ‘bid’ price when you sell all or part of your bullion assets.

Simply submit your written “sell instructions” to us and we will immediately execute the sale transaction based on your instructions. Because your bullion assets are LBMA credentialed and within the “Chain of Integrity”  Good Delivery Status is intact; your sale is transacted immediately.

Sell orders settle within two business days. When you place your order, you can either leave your sale proceeds in your Clear Title Account or have them transferred to your Bank Account of Record. You can request your disbursement via check or bank wire. Disbursements made via bank wire carry a $60 wire fee. Disbursements made by check carry no fee.

WHAT DOES IT COST TO SELL PRECIOUS METALS THROUGH PRIVATE CLIENT BULLION?

Your precious metal sale is based upon the fully transparent, current spot market price plus a transaction fee. There are no other hidden fees or costs.

With Private Client Bullion you avoid costly shipping and handling because you are selling metals already stored in a vault. You also avoid the costly discount for bullion coins and small bars levied by dealers and market makers.

CAN I REQUEST DELIVERY OF MY GOLD AND SILVER?

The Clear Title Program offers owners the ability to arrange collection or delivery of the bullion held in a client account at any time. The Clear Title Program requires three business days’ notice for the delivery of bullion holdings.

If a client takes possession at one of The Clear Title Program’s storage locations, there is no additional fee. If a client requests delivery of all or part of their account holdings to an alternative location, all fees associated with the safe transport of their bullion are the responsibility of the owner. As this cost is determined by the exact delivery instructions, clients will be invoiced for the specific costs associated with the transaction.

IS PRIVATE CLIENT BULLION A MARKET-MAKER OR A BROKER-DEALER?

No. Private Client Bullion works on an agency basis and does not take any proprietary risk on transactions. We are not a market-maker or broker-dealer. Pursuant to our organizational charter, we will not engage in speculative trading or market making activities.

WHAT IS THE EXECUTION AND SETTLEMENT PROCESS FOR A TRADE?

All trades must be authorized by written instructions from the Clear Title Account owner or its designated representative. This initial control prevents unauthorized executions from occurring.

All bullion purchases are done on a pre-funded basis meaning the cash necessary for the purchase must be in the account before the trade is originated. The Company is able to execute trades on behalf of a client’s Clear Title Account in the Primary Bullion Market. The Company’s trading relationships are exclusively with members of the LBMA so that all bullion products are part of the Good Delivery System.

The Company calls the trading desk of our trading partner and enters an order to buy bullion based on the client’s written instructions. Details of the transaction are recorded and a confirmation of the trade is generated by the bullion trading desk and sent to the Company. The trade details are entered into our Precious Metals System and a preliminary transaction purchase report is generated. This preliminary trade report is reconciled to the bullion trading desk confirmation. Once this reconciliation has occurred, the trade goes through the approval process. An operator other than the one responsible for entering the trade into the Precious Metals System reviews the trade details and can then either approve or reject the trade, if necessary, to correct an input error. On settlement date (T+2), when the specific bars are moved into custody, a similar approval procedure is followed. All the specific details of each bullion bar purchased as part of the trade are reconciled to the list produced by the bullion trading partner and payment is authorized. A final transaction purchase report is generated by the Precious Metals System and reported to the Clear Title Account owner.

Just as with purchases, all sales in a Clear Title Account must be authorized in writing. The Company acts upon the duly authorized instructions from the client and calls the bullion trading partner to sell the specific bullion bars identified in the client Clear Tile Account that are to be sold. Details of the transaction are recorded and a confirmation of the trade is generated by the bullion trading desk and sent to the Company. The trade details are entered into the Precious Metals System and a preliminary transaction sales report is generated. This preliminary trade report is reconciled to the bullion trading desk confirmation. Once this reconciliation has occurred, the trade goes through the approval process. An operator other than the one responsible for entering the trade into the Precious Metals System reviews the trade details and can then either approve or reject the trade, if necessary, to correct an input error. The Precious Metals System generates an Authorization to Release Material report for the vault facility where the bullion is stored. On settlement date (T+2), a similar approval procedure is followed. The bullion from the sale is released to the bullion trading partner and proceeds from the sale are received into the client’s Clear Title Account. A final transaction sales report is generated by the Precious Metals System and reported to the Clear Title Account owner.

DOES PRIVATE CLIENT BULLION CLEAR THROUGH MY EXISTING BROKER?

We are constantly working to integrate into new clearing platforms and report aggregators. Please ask if we work with your broker. If you have any suggestions for future partners, please let us know.

You can contact us via email at accounts@strategicgold.com or call us at 239 692-9154.

IS THERE ANY SALES TAX PAYABLE WHEN I BUY BULLION?

There are no taxes payable on the purchase of bullion through Private Client Bullion.

You may have to pay a sales tax if you take delivery or transport the bullion to a jurisdiction that requires such tax to be paid. You will be responsible for any sales or Value Added Tax (VAT) tax payable in your jurisdiction. You should consult with your tax advisor for definitive answers in the area of taxes.

DOES PRIVATE CLIENT BULLION APPLY ANY WITHHOLDING TAXES ON CAPITAL GAINS?

Private Client Bullion, operating as an agent of our clients, is currently not required to apply any withholding taxes on capital gains made on precious metals sold from a Clear Title Account. We have no requirement to report your sale to any government agency.

However, clients are advised to consult their own taxation professional in regards to the taxation and jurisdictional implications and issues (if any) of investing in precious metals in the Strategic Gold Clear Title Account Program.

CAN I CHOOSE WHERE I WANT MY PRECIOUS METALS TO BE STORED?

You have the ability to choose from one (or several) of our secure vault facilities. We offer insured custodial vaulting of your precious metals in a variety of locations both inside and outside of the United States. Our primary custodial vaults are:

  • Toronto, Canada
  • Miami, Florida
  • Zurich, Switzerland

When you buy gold or silver through your Clear Title Account, as part of your purchase order instructions, you will be asked where you would like to store your bullion assets. On settlement of your trade, your individual and specific bullion bars and/or coins will be moved into the vault facility that you have chosen. You will receive trade confirmations validating that your specific whole bars are in the vault. You can then go to the “Holdings” section of your online account to verify that your specific bars are present.

Our Precious Metals System is reconciled at the end of each business day so the Holdings section of your Clear Title Account remains an accurate ledger of the exact specifications of the individual bullion bars that you own in your account. Private Client reconciles total inventory on our system on a daily basis and reports this to our clients through the online Client Portal. Inventory reports containing bar lists are sent to Strategic Gold by our vaulting partners for all individual holdings and are reconciled with our database and reported to clients on an ongoing basis. Each quarter, an independent auditing firm, Bureau Veritas, performs an inventory audit of all the precious metals in each of the global vaults. Bureau Veritas provides individual account audit letters for each of our clients each quarter. These audit letters are both uploaded to your online account and mailed to each client at the end of each quarter.

In the future, Private Client Bullion may offer other storage locations based on security and customer preferences. Please contact one of our account executives if you would like to hold your precious metals in an alternative location. Certain restrictions may apply. Please feel free to inquire at (239) 692-9154.

WHAT IS ALLOCATED STORAGE?

All precious metals stored in Private Client Bullion’s Clear Title Program are fully allocated. “Allocated” means that each specific whole bar or coin is held in the vault exclusively on behalf of an individual owner.

Allocated storage of precious metals is the best way to store gold and silver because it ensures that you are the direct owner of the specific whole bar or coin, not Private Client Bullion or any other third-party. When a precious metal is allocated, there is a defined and recorded owner of the specific bar or coin, namely you. You enjoy full legal title to each individual bar or coin that you own. This is why we called our program the Clear Title Program, because you —the owner—retain Clear Title to your assets at all times.

Neither Private Client Bullion nor the vault custodian has any direct claim on your precious metals.

HOW DOES ALLOCATED STORAGE BENEFIT A CLEAR TITLE ACCOUNTHOLDER?

Allocated storage is the safest and most transparent method way to hold Clear Title to your precious metals assets. You alone are the direct owner of the assets you hold in your Clear Title Account, not Private Client Bullion, the vault custodian, or any other third-party.

A good way to compare allocated versus unallocated storage is to look at it in accounting terms. Allocated metal does not show up on the balance sheet of Private Client Bullion or the vault operator. It is an off balance sheet item—meaning, it is your outright property.

Unallocated metal shows up in a company’s balance sheet as an asset, and the claims to the metal from its customers as the corresponding liability. This is how many accounts with financial institutions work, as well as many of the precious metals storage programs that are sponsored by governments or private entities. If one of those entities were to go bust, any of its creditors would have first claim to those unallocated assets, leaving the entity’s customers with no access to the metal (liabilities) promised to them.

Unlike most precious metals firms, Private Client Bullion does not offer unallocated storage. All metal administered by our firm is always owned by a specific client at all times and therefore never shows up as an asset or a liability on our books.

When your metal is held in a Clear Title Account, you have the assurance that your gold and silver is protected should Private Client Bullion or the vaults we work with ever face bankruptcy or other financial difficulties. In the unlikely event that Private Client Bullion or our vaulting partner were to experience financial difficulty, our creditors would have no claim to your property since it is not a financial asset of Private Client Bullion or the vault operator.

WHAT ARE THE KEY BENEFITS OF PRIVATE CLIENT BULLION’S SECURE STORAGE?

Private Client Bullion’s Clear Title Program was designed to meet systemic insurance criteria. Unlike ETFs and gold
derivatives, Clear Title Accounts provides maximum insulation against counterparty risk. We were the first vehicle to offer real ownership of physical gold securely stored in non?financial vaults located in close proximity to the most liquid global bullion markets. Our Clear Title Accounts combine key advantages of modern financial products – liquidity, transparency, professional management, strong fiduciary controls and reporting, with diversification benefits of traditional commercial arrangements that involve tangible goods – strong property rights with no reliance on financial institutions or capital markets.

Private Client Bullion offers benefits not available in gold derivatives and Exchange Traded Products such as:

  • Your precious metals always remain your exclusive legal property;
  • Gold bullion is held in fully insured accredited vaults;
  • Investors can tailor geographic diversification of their bullion allocation;
  • Multiple storage, logistics and trading relationships in jurisdictions with strong legal protections ensure safety and ready access to bullion markets;
  • There is no leverage or derivatives;
  • No financial risks;
  • No counterparty risks;
  • No reliance on functioning capital markets and intermediaries;
  • No price divergences between the spot market price and the value of your physical gold and silver;
  • Multiple exit strategies – $US cash, bullion, other currencies, and other strategies;
  • Discrete ownership with no reporting requirements and full compliance with US regulations; and
  • High Liquidity – you are able to sell your bullion without delay at the best price.

ARE MY PRECIOUS METALS INSURED?

Yes. Your precious metals are insured to their full market value (their full replacement value) at all times. The cost of this insurance is included in your administration fee.

Private Client Bullion makes sure that the coverage maintained by each vault operator is at least equivalent to the value of all the gold or silver that the vault operator holds on behalf of Clear Title accountholders.

HOW DO I KNOW THAT MY PRECIOUS METALS ARE REALLY IN THE VAULT?

There are several important checks and balances that we have put in place to ensure that the precious metals that you own are protected. We work closely with our partner vault operators to ensure that Private Client Bullion’s Precious Metals System is reliable and secure, and that all the metal is stored safely for our customers.

Precious metal holdings are independently reconciled on an ongoing basis by Private Client Bullion, our approved vaulting partners and our independent auditors. Inventory reports containing bar lists are sent to Private Client Bullion by our vaulting partners for all individual holdings and are verified and reported to clients daily. In addition, Bureau Veritas physically audits all of our client’s precious metal holdings in the vault facilities each quarter.

Bureau Veritas reviews a wide variety of our controls and procedures and provides proof of the 1-to-1 ratio of metal held in the vaults and metal recorded in our Precious Metals System. Bureau Veritas certifies that a Client’s precious metals are physically present in the Vault Facility. On the same day at the end of each quarter an auditor enters each of the custodial vaults and performs a sight verification audit comparing the individual gold and silver bars that are in the vault against an inventory list supplied by the Custodian and another provided by Private Client Bullion. The inventory lists include the manufacturing refinery’s hallmark, the unique serial number on each gold or silver bar, the exact weight in fine troy ounces, and the purity of the bullion. This audit is also cross verified by an agent of the Custodian who signs off on the Certificate of Deposit with the sight verification auditor. The Independent Auditor verifies that gold and silver bars allocated to clients reflect the exact number of fine troy ounces contained within the custodial vaults, that no gold or silver bars are over or double allocated to clients, and that a one-to-one ratio of troy ounces in the vault-to-Private Client Bullion records exists at all times. The results of these quarterly audits are sent directly to each Client in the form of an individual account audit report.

As an additional measure of security and verification of the Clear Title Account Program, Loomis International issues reports to Private Client Bullion that record each instance of bullion being added to or removed from the vault. This additional measure provides external corroboration of Private Client Bullion’s audit trail of all holdings.

To request additional information on our independent auditors, please email accounts@strategicgold.com or call us at 239 692-9154.

CAN I VISIT THE VAULT IN ORDER TO PERSONALLY INSPECT MY GOLD AND SILVER?

Yes, Clear Title accountholders can personally inspect their bullion assets at the vault facility where their precious metals are stored. We would be happy to facilitate your visit.

You can make arrangements to visit the vault by calling (239) 692-9154 or send us a message at accounts@strategicgold.com if you are interested in inspecting your gold and silver assets.

CAN I MOVE OR EXCHANGE METALS BETWEEN VAULTS?

Yes. We believe that financial freedom is all about having personal control. Therefore, with your Clear Title Account you can easily transfer metals from one vault to another. Since you own specific bullion bars or coins in your Clear Title Account, you can accomplish this in two different ways.

  • We can facilitate the secure transport of your specific bullion bars from one vault facility to another. Strategic Gold does not charge a fee for this service; however, you will be responsible for paying the invoice of the secure transport company.
  • We can facilitate the sale of your metal in one location and the simultaneous purchase of the same number of ounces in an alternate location. By exercising this option you will be avoiding the secure transport cost associated with the physical movement of your specific bars. Private Client Bullion does not charge a transaction fee on this purchase or sale transaction.

 

CAN I COLLECT MY GOLD AND SILVER FROM THE VAULT FACILITY?

You can collect your gold and silver bars in person from all vaults where the bars are available for storage.

You can pick up your gold and silver bars at any of our bullion vaults in person during office hours with a pre-arranged appointment. We can also organize physical delivery via security transport to a destination of your choice anywhere in the world.

WHAT HAPPENS WHEN I WANT TO TAKE DELIVERY OF MY GOLD OR PICK IT UP FROM THE VAULT?

We would also be happy to arrange for you to personally collect your bullion bars from the vault where they are stored or from a secure location nearby. We can also assist you in having your precious metals shipped from the vault facility to your location of choice.

To get started, send us your written instructions on how you want to take delivery of your precious metals. Once we have verified your instructions, we will contact the vault facility where your metals are being stored and make the arrangements for its transport or release. The vault operator or secure transport carrier will also complete any customs forms that may be required, but you are responsible for payment of customs duties and any other costs that may apply according to the laws of the applicable jurisdiction (such as sales tax or VAT). Private Client Bullion will confirm and collect all shipping costs from you before providing your shipping instructions to the vault operator of secure carrier.

Please contact an account representative to arrange for collection or delivery of your precious metals by email at accounts@strategicgold.com or call us at 239 692-9154.

WHAT CUSTOMS DUTIES OR TAXES APPLY FOR DELIVERY OR COLLECTION?

Customs Duties and Taxes vary across jurisdictions. Private Client Bullion will be happy to work with you to understand all relevant fees associated with your delivery or collection request. You are responsible for payment of customs duties and other taxes such as VAT that may apply when requesting delivery or collecting bars from the vault.

To learn more, contact an account representative by email at accounts@strategicgold.com or call us at 239 692-9154.

HOW MUCH DOES PRIVATE CLIENT BULLION’S SECURE STORAGE COST?

The cost of storing your bullion in your Clear Title Account is extremely competitive. Private Client Bullion charges a comprehensive Administrative Services Fee which covers all the expenses of your Clear Title Account. The Administrative Services Fee is three-fourths (3/4) of one percent of the market value of the gold bullion per annum and seven-eighths (7/8) of one percent of the market value of the silver bullion per annum.

WHAT IS INCLUDED IN THE ADMINISTRATIVE SERVICES FEE?

The Administrative Services Fee covers the Clear Title Account Program’s services, including:

  • Custody & Secure Vault Storage
  • Third Party, Quarterly Bullion Audits
  • Third Party Transaction Oversight
  • Account Insurance (Bullion)
  • Administrative Services and Reporting

HOW IS THE ADMINISTRATIVE SERVICES FEE CALCULATED?

The Administrative Services Fee is calculated each month by applying a Monthly Periodic Rate to the Average Daily Value of the precious metals in your account each month. The Monthly Periodic Rate will be 1/12th of the Annual Rate. The Daily Value of your account is calculated by multiplying the number of ounces of precious metals in the account by the Daily London PM Fix price of bullion per ounce applicable to your precious metals. The Average Daily Value is calculated each month by adding the Daily Value of the account for each day of the period and dividing that sum by the number of days in the period.

WHEN IS THE ADMINISTRATIVE SERVICES FEES CHARGED ON MY CLEAR TITLE ACCOUNT?

The Administration Fee is charged quarterly in arrears.

Each quarter you will receive a statement reflecting the total Administrative Services Fee that has accrued during the prior quarter. The accrued quarterly Administrative Services Fee will be deducted from your Clear Title Account on the payment date indicated on the quarterly statement. As a rule, this payment date will be the 15th day of the month (or the next business day thereafter, if the 15th falls upon a weekend or holiday) immediately following the end of quarter date.

HOW CAN I VIEW AND VERIFY THE CALCULATION OF THE ADMINISTRATIVE SERVICES FEE?

We understand that transparency is key to delivering excellent service. Your Clear Title Account provides you with tools and resources designed to empower you to secure your financial future with full accessibility and complete control.

The accrual of the Administrative Services Fee can be viewed in your secure online account on the Fee Accrual page. Simply login to your account and select ‘Fee Accrual’ from the menu. Notice that there is a filter option so that you can monitor your Administrative Fee calculations according to specific dates. The daily rate is calculated using Metal Type and PM Fix for each date.

Please note: The Admin Fee Billable column is populated on the last day of the quarter.

Your Clear Title Account Administrative Services Fee is also confirmed in your Statements, which are available by selecting ‘Statements and Audits’ page.

For further information or if you have a question about the Administrative Services Fee, please contact an account executive at 239 692-9154.

HOW CAN I PAY THE ADMINISTRATIVE SERVICES FEE?

Payment of fees owed are automatically deducted from your Clear Title Account only after you have received advance notice via the quarterly account statement of the amount to be deducted and you have had a reasonable opportunity to verify the accuracy of the Administrative Services Fee calculation. On the payment date indicated in each quarterly statement, Private Client Bullion will automatically debit the previous quarter’s accrued Administrative Services Fee from your account accordingly:

Cash Debits

The Administrative Services Fee will be automatically deducted from the cash balance in your Clear Title Account. In this way, you have the option of paying your fee in cash by ensuring that your account holds a cash balance sufficient to cover the prior quarter’s accrued expense.

Bullion Debits

In the event that your account does not hold a sufficient cash balance to cover the quarterly Administrative Services Fee, you authorize Strategic Gold to initiate a bullion debit. A bullion debit means that a minimum number of small bars will be sold from your Small Bar Holdings at the spot market price on the payment date indicated on your quarterly statement in order to raise the cash necessary to cover your quarterly Administrative Services Fee. This will necessarily involve a sale of precious metals of equivalent value to cover the fee owed. After the Administrative Services Fee has been collected, any cash balance generated from the sale of your small bar(s) is immediately posted to your account.

WHAT IF I DO NOT HOLD A CASH BALANCE TO PAY THE ADMINISTRATION FEE?

In the event that your account does not hold a sufficient cash balance to cover the quarterly Administrative Services Fee, you authorize Strategic Gold to initiate a bullion debit. A bullion debit means that a minimum number of small bars will be sold from your Small Bar Holdings at the spot market price on the payment date indicated on your quarterly statement in order to raise the cash necessary to cover your quarterly Administrative Services Fee. This will necessarily involve a sale of precious metals of equivalent value to cover the fee owed. After the Administrative Services Fee has been collected, any cash balance generated from the sale of your small bar(s) is immediately posted to your account.

WHAT IS THE CLEAR TITLE ACCOUNT CLIENT PORTAL?

The Clear Title Client Portal is the secure online account management gateway that allows a Client to access and manage their Private Client Bullion Clear Title Account.

Features of the Client Portal include:

Account Summary – view the quick summary of the value of your account (cash and bullion), the pending transactions and Administrative Fees due.

Holdings – view the specific details of each gold and/or silver bar held in your account.

  • Metal Type
  • Hallmark
  • Serial Number
  • Purity
  • Fine Ounces
  • Vault Facility

Account Activity – view your complete account activity and history of transactions.

Fee Accrual – monitor the transparent calculation of your Administrative Services Fee.

Statements and Audits – view or download the complete archive of your quarterly statements and audit reports.

To learn more about the Clear Title Account Client Portal, please contact an account representative at 239 692-9154.

HOW DO I VIEW MY ACCOUNT HISTORY WITH BALANCES AND TRANSACTIONS?

To view your complete account history with balances and transactions simply login to your secure online Clear Title Account using your username and password. You can track your investments by transaction type, inventory identification number or metal type. You can also view cash balances and fees.

For your added convenience, a complete archive of your account statements and audit reports are also available in pdf format.

For assistance in using your secure online account or to request customized reports, please contact a client representative at 239 692-9154.

HOW OFTEN DO I RECEIVE ACCOUNT STATEMENTS?

Private Client Bullion issues quarterly account statements which reflect your cash and bullion holdings and valuations.

Clients can request more frequent statements (monthly or weekly) by contacting an account executive at 239 692-9154.

HOW DO YOU DETERMINE THE VALUE OF MY CLEAR TITLE ACCOUNT?

The value of your Clear Title Account is calculated each day using the London PM Fix price of Gold multiplied by the total number of gold ounces plus the Silver Fix Price multiplied by the total number of silver ounces plus any cash balance.

HOW OFTEN DO YOU UPDATE THE VALUE OF MY ACCOUNT?

The value of your Clear Title Account is updated at the end of each business day between 5:15pm EST and 6pm EST.

WHAT FEES DOES PRIVATE CLIENT BULLION CHARGE?

A key value of your Clear Title Account is its simplified fee structure.

Transaction Fees:

Private Client Bullion charges a transaction fee on purchases and sales. There are no fabrication fees, no vault in/out fees and no other hidden premiums or commissions that are added to your purchase/sale price.

Administrative Services Fee

Clients in the Clear Title Program are assessed a comprehensive annual Administrative Services Fee of 3/4 of one percent of the market value of their gold bullion holdings (.0075 x Value of Gold Bullion) and 7/8 of one percent of the market value of their silver bullion holdings (.00875 x Value of Silver Bullion). The annual fee is billed to clients on a quarterly basis and covers all of the services and features of the Program, including:

  • Custody & Secure Vault Storage
  • Quarterly Audits
  • Insurance
  • Administrative Services and Reporting

Private Client Bullion delivers transparency, ease of transaction and substantial price advantages to you by giving you the ability to purchase and sell gold at the Spot Market Price in the Primary Bullion Market.

DO I HAVE CONFIDENTIAL GOLD OWNERSHIP?

Yes. Your gold and silver purchases, sales and holdings are totally confidential. Neither Private Client Bullion nor our custodial vaults is currently required to report either your transactions or your holdings to any authority in any country.

DOES PRIVATE CLIENT BULLION DISCLOSE THE BENEFICIAL OWNERS OF A CLEAR TITLE ACCOUNT?

No. Private Client Bullion has no requirement to disclose the beneficial owners of a Clear Title Account.

WHY DOES PRIVATE CLIENT BULLION OFFER STORAGE IN FREE TRADE ZONES?

Our secure storage facilities are located within free trade zones where transactions are tax exempt & the identity of the beneficial owner does not need to be disclosed.

In selecting our vaulting locations we have tried to provide you a choice of jurisdictions with a proven track-record and history of defending personal property rights and confidentiality.

DOES PRIVATE CLIENT BULLION REPORT MY ACCOUNT ACTIVITY TO THE IRS OR ANY OTHER AGENCY?

No. Private Client Bullion does not have any obligation to report the account activity that you engage in using your Clear Title Account to the IRS or any other government agency.

Furthermore, there is no required reporting of your Clear Title Account in any of our international vaults as long as your precious metals are maintained within the Chain of Integrity of the Good Delivery System. Wherever you live your trading activity and gold ownership are not reported to any authorities, anywhere in the world. Your trading activity, account balances and bullion assets are therefore not reported.

If you have questions about gold investment on our platform, speak to an account representative at 239 692-9154.

DO US ACCOUNTHOLDERS HAVE TO FILE A FOREIGN BANK ACCOUNT REPORT (FBAR)?

Private Client Bullion does not consider itself to be a ‘financial institution’ nor are we a foreign institution. The IRS requires those with a financial interest or signature authority over a foreign financial account to report the account yearly to the Internal Revenue Service by filing Form TD F 90-22.1 otherwise known as the FBAR.

United States persons are required to file an FBAR if:

  • The United States person had a financial interest in or signature authority over at least one financial account located outside of the United States; and
  • The aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year to be reported.

If you are in any doubt about whether you should file Form TD F 90-22.1 as a result of having a Clear Title Account, we recommend that you consult with your tax advisor.

Please feel free to contact an account representative at 239 692-9154 if you have a question.

DOES PRIVATE CLIENT BULLION FILE A FBAR?

Yes. Since Private Client Bullion has signature authority over the custody accounts which we maintain with our vaulting partners, we file the FBAR. No client information is disclosed through our filing the FBAR.

Please feel free to contact an account executive via email at accounts@strategicgold.com or call us at 239 692-9154 if you have any questions.

WHAT IS THE REGULATORY STATUS OF PRIVATE CLIENT BULLION?

Private Client Bullion is not an investment management or fund management business. You are not giving us money to invest on your behalf, nor do we offer investment advice regarding when or what to buy or sell. We simply enable you to buy, hold, sell and take delivery of precious metals.

While Private Client Bullion strictly adheres to the highest business and governance standards, the firm is not required to be registered with any regulatory authority. The firm is not subject to registration under the securities laws as a dealer or investment adviser because it’s activities are limited to non-securitized, physical gold and physical silver bullion. Accordingly, the firm’s activities:

  • Are not governed by the Securities Act of 1933. All precious metal bullion owned and held in a Strategic Gold Clear Title Account is specific, allocated, unencumbered gold and silver bullion and is not a securitized form of the precious metal.
  • Are not governed by the Investment Advisers Act of 1940. Strategic Gold does not engage in management or advisory services.
  • Are not governed by the Commodity Futures Trading Commission (“CFTC”). The CFTC regulates the futures market. Section 742 of the Dodd-Frank law exempts any “contract of sale that – ‘‘(aa) results in actual delivery within 28 days or such other longer period as the Commission may determine by rule or regulation based upon the typical commercial practice in cash or spot markets.” Clear Title Account owners take delivery of their precious metals on settlement date (T+2) as evidenced by their Bailment Agreement with the Company.

In addition, the firm is not subject to regulation as a Money Services Business (“MSB”). Private Client Bullion requires as part of its account application and opening documentation disclosure of the account holder’s bank account and bank representative. All money that is used to fund Clear Title Account bullion purchases must originate from this linked account. Likewise, any money disbursed from the Clear Title Account is sent back to that same bank account on record. Due to this “closed system” structure the firm is not considered a Money Transmitter.

For more information, or to request our ‘Model Due Diligence Questionnaire’, please contact us via email at accounts@strategicgold.com or call us at 239 692-9154.

DO YOU FOLLOW COMPLIANCE PROCEDURES, INCLUDING A BUSINESS CODE OF ETHICS?

Yes. The Company maintains and reviews written compliance policies and procedures which are included in its Code of Business Conduct and Ethics.

Private Client Bullion believes that quality governance begins with sound principles. Board independence, independent auditor review, strong internal controls, and transparency are at the center of the Company’s governance and compliance structure. Private Client Bullion is committed to its governance principles and their inculcation into the Company’s culture. Accordingly, the Company has adopted a Code of Business Conduct and Ethics (the “Code”).

In addition, the Company adheres to the business standards established by the London Bullion Market Association (“LBMA”). The LBMA is an international trade association, representing the London market for gold and silver bullion which has a global client base. This includes the majority of the gold-holding central banks, private sector investors, mining companies, producers, refiners and fabricators.

Our designated Corporate Compliance Officer has over thirty years experience at the senior executive level in the back office functions and operations of financial services organizations. The Senior Management Committee and Corporate Compliance Officer operate under strict corporate policies and guidelines to insure the total integrity and safety of the bullion and cash holdings within all client Clear Title Accounts. The Company maintains and reviews written compliance policies and procedures which are included in its Code of Business Conduct and Ethics.

Also included in the Code is a policy for the handling and safeguarding of all material, non-public information. Part of the Corporate Compliance Officer’s duties includes a review and attestation from all key personnel for the safeguarding of this information.

For more information, or to request our ‘Code of Business Conduct and Ethics’, please contact us via email at accounts@strategicgold.com or call us at 239 692-9154.

HOW DO I KNOW THAT THE ASSETS IN MY CLEAR TITLE ACCOUNT ARE SAFE?

To ensure that your precious metals are safe and secure, Private Client Bullion works closely with independent service providers as partners to complete all essential functions under carefully designed checks and balances that reinforce accountholder protections and the safety of each accountholder’s assets. This system of checks and balances between Private Client Bullion and its various service providers – and the clear audit trail they establish – create a reliable and trustworthy arrangement with important customer safeguards. These include insurance of your metal, dual control over the addition and removal of metal in the Private Client Bullion system and a continuous, one-to-one ratio of metal in the vault to metal recorded in Strategic Gold’s Precious Metals System database.

To ensure that all governance procedures and operating systems are working properly, Private Client Bullion is audited by two separate and independent auditing firms every quarter. These audits include visits to the vault to confirm that the weight of gold and silver stored there are the same exact bars recorded in a client’s account as well as the verification of all cash movements and balances. These audit reports are available for download by Private Client Bullion customers in their secure online account.

DOES MY OWNERSHIP DEPEND ON THE SOLVENCY OF PRIVATE CLIENT BULLION OR THE CUSTODIANS?

Absolutely not, you maintain Clear Title to your assets at all times and you have the unfettered right to take delivery of your gold at any time. For as long as your bullion assets are held in your Clear Title Account, they remain your outright property, stored in specialist facilities run by accredited professional vault operators who are wholly independent of Private Client Bullion. As evidenced by the Bailment Agreement, we are simply the administrator of your assets, never the owner.

When you hold your assets with us, you are truly isolated from the systemic risks in the financial system. You have taken legal delivery of your gold and/or silver and you own it directly in physical form. Unlike the majority of investment products no company’s financial failure can deprive you of these assets. Private Client Bullion, or any individual custodial vault could fail – and your assets are still safely yours. No one else may claim title of your bullion assets.

WHAT SAFEGUARDS ARE IN PLACE TO PROTECT MY ASSETS IF A VAULT CUSTODIAN SHUTS DOWN?

In the unlikely event that one of our vault custodians stops operating, we will contact you in order to provide you with a list of alternative vaults where you can securely store your assets.

All custodial vaults within our network are monitored based on their performance and compared to our service standards. Private Client Bullion employs a comprehensive selection strategy when choosing secure custodial vaults. All potential providers within a market are reviewed for the following key criteria:

  • LBMA certification
  • Services and responsiveness
  • Security credentials
  • On-site due diligence
  • Accessibility
  • Reputation and standing in local market

The vault facilities house the most modern systems for safekeeping and administering real assets. All working processes in these maximum-security vaults are fully automated.

WOULD A CREDITOR OF PRIVATE CLIENT BULLION OR THE CUSTODIANS HAVE ANY HOLD ON MY ASSETS?

No. Your bullion is your property and is allocated to you only. It is not the property of Private Client Bullion nor the bullion vault custodian(s), nor is it vulnerable to creditors of either.

HAVE PROPER DISASTER RECOVERY PROCEDURES BEEN PUT INTO PLACE?

Private Client Bullion has implemented a Business Continuity Plan (BCP) to ensure that operations can continue without significant interruption to customers in the event of a disaster. A ‘Disaster Event’ is any risk event that significantly impairs the ability of Private Client Bullion to operate at its primary facilities in Naples, Florida with its primary personnel. The BCP is reviewed, tested and updated annually to ensure the business can handle disruptions while minimizing downtime to customers. The BCP covers key aspects of Strategic Gold’s business such as the information technology (IT) infrastructure, operations and customer service.

Private Client Bullion’s operations and customer service teams can be recovered to a separate disaster recovery location. The secondary site is equipped with computer and communication facilities required to support operations with minimal disruption. Each member of the operations team has an appointed alternate for the purpose of maintaining continuity in executing customer orders, bank transactions and vault operations.

If you have additional questions on our Business Continuity Plan, please contact one of our account representatives at 239 692-9154.

IF I HAVE A GRIEVANCE, WHERE AND HOW DO I COMPLAIN?

If you have any complaints in relation to the service being provided by Private Client Bullion, you should contact our Naples office immediately at 239 692-9154. In particular, if you dispute, disagree with or have any issue with the content of any communication sent to you by email or by mail you must contact Private Client Bullion immediately. Private Client Bullion shall be entitled to assume your acceptance of the content of an email or postal communication if within three business days of the date of transmission to the correct email address or the date of service of such postal communication (as the case may be), no response from you has been received by Private Client Bullion.

Private Client Bullion shall use all reasonable endeavors to resolve any issues communicated to us by you, but you acknowledge that any delay in communicating such dispute, disagreement or issue may prevent or reduce the value of any resolution of such matter.

Ask a Question

Do you have a question?

Please feel free to reach out to us with any questions you may have.

13 + 10 =

Private Client Bullion

Cras ultricies ligula sed magna dictum porta. Praesent sapien massa, convallis a  Cras ultricies ligula sed magna dictum porta. Praesent sapien massa, convallis a Cras ultricies ligula sed magna dictum porta.