GoldMoney
Reading time: 7 – 12 minutes
Probably because of my legal background many readers have asked my opinion about GoldMoney.com and whether GoldMoney is a scam or fraud. So I took an afternoon to sit down, got out my lawyerly glasses and did an in-depth review of the applicable legal documents. While this article should not be considered legal advice or a legal opinion I have provided easy access to many of the source documents, applicable law and other references that I came across in my review. I hope you find this helpful.
I found that GoldMoney is a great way to buy gold or silver along with being an innovative digital gold currency. I performed a similar review on the ETFs GLD and found GoldMoney far superior. Gold belongs in an investor’s portfolio at all times and in all circumstances. This video is a brief introduction to GoldMoney and how to buy gold and silver online. Holdings are free to open, no minimum balance, take about 20 minutes, can be funded within 24 hours and are perhaps the best and most affordable offshore option that is efficient, safe and secure.
BULLION AND NATIONAL CURRENCIES
Bullion held with GoldMoney is NOT subject to counter-party risk. National currencies (Dollars – USD, Canadian Dollar – CAD, British Pounds – GBP, EURO – EUR, Swiss Francs – CHF and Yen – JPY) are held with the safest banks in customer segregated funds accounts and interest is earned. Whether you want to hold national currencies or bullion such as goldgrams or silver ounces that can be petted GoldMoney is a great solution.
As referenced in the video the due diligence on GoldMoney is collected here:
OTHER RECOMMENDATIONS
Several investment professionals have reviewed and recommend GoldMoney including billionaire Eric Sprott, John Embry, Mike ‘Mish’ Shedlock and Doug Casey.
Outspoken critic of ‘paper gold’ Adrian Douglas of GATA warned, “What should investors do? Investors need to do their due diligence. They need to determine if they are actually holding a 100-percent precious-metal-backed investment. There are some unallocated investment vehicles that are entirely honest where all the gold and silver sold is actually purchased and held on behalf of the customers. One such example is GoldMoney.com, which conducts and publicizes third-party audits to verify 100-percent backing.”
Peter Schiff recommends GoldMoney on page 228 of his bestseller CrashProof. ”There are also several places to buy gold on the Internet, and even several that offer storage programs. In general, I would be very reluctant to trust most storage programs, but one exception is GoldMoney.com, founded by James Turk, a longtime gold advocate and widely respected figure. Investors and shareholders of GoldMoney include two publicly traded gold mining companies”
Michael Maloney recommends GoldMoney on page 192 of Guide to Investing in Gold and Silver. ”I can speak from personal experience here as I have used one of these companies for some time now.
Having an account at the company I deal with is sort of like having a bank account, currency trading account, payment system, and bullion storage account, all in one. You can hold any combination of, and/or trade between, U.S. dollars, euros, British pounds, Canadian dollars, gold, and silver. While holding these currencies you are paid interest at a rate comparable with a savings account, and, when holding gold or silver, your storage and account fees are among the most competitive in the industry. The metals are allocated and at all times vested to and owned by, the customer. So you are the absolute owner of your gold and silver … no one else.
I believe this is the best way to hold precious metals outside your own country.”
SHAREHOLDERS, REGISTRATION, LICENSES AND LAW
GoldMoney shareholders include two publicly traded companies DRDGold (sold its interest in 2008) and IAMGOLD. IAMGOLD offers investors the ability to receive dividends payments via GoldMoney.
Jersey Business Banking Law of 1991 - An example of the applicable Bank Privacy provisions. Part 4 – 42 Restricted information, “no person who under purposes of this Law receives information relating to the business or other affairs of any person; and no person who obtains any such information directly or indirectly from a person who has received it as aforesaid, shall disclose the information without the consent of the person to whom it relates and (if different) the person form whom it was received as aforesaid. … Any person who discloses information in contravention of this Article shall be guilty of an offence and liable to imprisonment for a term not exceeding 2 years or a fine, or both.”
Those subject to US jurisdiction may be required to file a TD F 90-22.1 Form.
GoldMoney Business Name Registration
GoldMoney gold and silver bullion bar count
Holdings can be opened via IRAs
GoldMoney customers can obtain the Deloitte & Touche audit report from GoldMoney customer service through the internal messaging system.
Ability to Demand Delivery of Gold. According to the User Agreement under VIII. Storage “E. A User may, by providing GoldMoney with delivery instructions, which instructions must be in the form prescribed from time to time by GoldMoney and the Vault, at any time request GoldMoney to change the goldgrams and silver ounces in his Holding into grams of gold or ounces of silver that are available for physical delivery to the User, provided that there are sufficient goldgrams and silver ounces to take delivery of a London Good Delivery bar of gold, which bar weighs approximately twelve thousand five hundred (12,500) grams, or bar of silver, which bar weighs approximately one thousand (1,000) ounces. GoldMoney will not charge a fee for its service, but fees may be charged by the Vault for acting on the delivery instructions.”
COMPETITORS AND THEIR DISADVANTAGES
Other ways of purchasing gold, particularly when counter-party risk is present, entail restrictions on demanding delivery of bullion. For example:
The Problem with the ETFs GLD and SLV
A GoldMoney competitor called BullionVault, which appears to be a respectable operation, offers ‘allocated storage’ has this restriction: ”Excepting only duly authorized shipments to another BV gold storage location – such as might be requested by customers in response to an international crisis – BV undertakes that on no single day shall any amount exceeding both 25 kilograms and 5% of the bullion vaulted at a BV location be authorized for removal.”
The NYMEX has significant restrictions which can significantly delay delivery.
The TOCOM now allows ‘paper gold’ to settle futures on physical gold contracts.
These forms of ‘paper gold’ may because of their lack of transparency involve significant fraud while GoldMoney does not because of the internal controls that are built inherently into the system that result in significantly more transparency.
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In regards to Goldmoney with US citizens holding more than $10,000 in their holding, you said:
“Those subject to US jurisdiction may be required to file a TD F 90-22.1 Form.”
Would they need to or not with the above conditions?
How one can find out reputable dealers
for phisical gold& silver?
for example Gold line is advertised heavily.
Are they trustworthy ?
I have not purchased from Goldline. I assume they are trustworthy because they are so large, have been in business for a long time and have a B+ with the BBB. But the advertising expense has to be paid somehow and it is usually through higher premiums on the products.
I can highly recommend this source for quality information.
They review several sources for gold; silver buying. They recently released an informative documentary entitled, “Meltup.” Worth watching!
http://www.youtube.com/watch?v=eb1n1X0Oqdw
Thanks so much for your research and advice
In your review you indicate that “Those subject to US jurisdiction may be required to file a TD F 90-22.1 Form.” but you do not say if this is a requirement of the IRS or GoldMoney or both. Other than the IRS requirements that every US citizen must report their income annually what are the requirements of Gold Money? Do they submit to the IRS any reporting of purchases or sales of gold? Jack Maxwell
Hi Jack, the form is a requirement under US federal law and not a requirement of GoldMoney in anyway. GoldMoney is regulated by the Jersey Financial Services Commission. I am not sure what reporting requirements GoldMoney is subject to, if any, to the IRS or anyone else regarding purchases or sales of gold. They may even be subject to confidentiality under the Jersey Banking law. It is wise to keep in mind that any international wires originating from the US are automatically reported to the Treasury and Federal Reserve. With the new reporting requirements tucked into the Health Care Bill and other legislation, such as the extremely broad foreign financial assets disclosure, it is even more likely that a GoldMoney account will need to be reported.
As a successful bullion dealer for over a decade now, I have gotten the message that any U.S. citizen over age 18 should have assets overseas. Remember that the global financial system has failed and is failing, so the weakest link in all of these offshore arrangements is the financial institution holding the invested funds prior to PM purchases. If you have a currency account, which is earning nada interest right now, thank you Ben Bernanke et. al., you need to know the financial exposure of the holding institution to real estate and derivatives versus their total capitalizations. Not an easy task. Buy the precious metals shortly after you transfer the funds, then figure out if the depository holding your metal has any legal connection to say a Swiss bank or financial institution and what are the firewalls between the two entities, depository and institution. None of this is simple to discern, but it is called due diligence. So far both BullionVault and GoldMoney have not absconded with any of my funds or metals, but the proof of the pudding is in when you want physical delivery or return of funds. That is the only real test and most of us are not their yet since the Dollar ain’t where we want to be with our money. Good article, but more rock turning to be done.
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