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That Physical Gold You Thought You Owned? You Didn't
Earlier today, the CFTC issued an order and charges against two Boca Raton companies, (Joseph Glenn Commodities LLC and JGCF LLC, and their owners Scott Newcom and Anthony Pulieri) which accused the abovementioned of engaging in illegal, fraudulent off-exchange financed transactions in precious metals with retail customers, and also ordered them to pay over $1 million in restitution payments. Superficially, it would have been any other run-off-the-mill CFTC wristslap against an entity that is deemed not TBTF, and thus systematically relevant, in the parlance of the DOJ (unlike the Jon Corzines of the world, who are perpetually absolved of all crimes - actual and alleged), if only it wasn't for one small clarification at the end of the body.
The relevant section is bolded below:
The CFTC Order finds that from July 2011 through June 2012, the Respondents solicited retail customers, generally by telephone or through Joseph Glenn’s website, to buy physical precious metals such as gold, silver, copper, platinum, or palladium in what are known as off-exchange leverage transactions. According to the Order, the customers paid the Respondents a portion of the purchase price for the metals, and Joseph Glenn and JGCF purportedly financed the remainder of the purchase price, while charging the customers interest on the amount they purportedly loaned to customers.
[T]he CFTC Order states that when Joseph Glenn and JGCF engaged in these illegal transactions they were acting as dealers for a metals merchant called Hunter Wise Commodities, LLC (Hunter Wise), which the CFTC charged with fraud and other violations in federal court in Florida on December 5, 2012 (see CFTC Press Release 6447-12). Hunter Wise was purportedly Joseph Glenn’s and JGCF’s source for the metal and the loans. As alleged in the CFTC Complaint against Hunter Wise and according to the CFTC Order in this case, however, neither Joseph Glenn, JGCF, nor Hunter Wise purchased or held metal on the customers’ behalf, or disbursed any funds to finance the remaining balance of the purchase price. The Order finds that the Respondents’ customers thus never owned, possessed, or received title to the physical commodities that they believed they purchased.
In other words: that physical gold that your trusted "held" on your behalf... they never really held it, and neither did you. But don't worry: all the gold "held" by various brokers professing physical possession and not to mention thousands of assorted paper gold ETFs is certainly there.
After all, where else can it possibly be (certainly not in the 5th subbasement of 1 Chase Manhattan Plaza housing the largest gold vault in the world)
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Using this kind of case to make the argument that if it isn't buried in your backyard, you don't own it, is silly. There is an enormous distinction between owning physical, allocated metals, stored in high-security vaults, with proof of serial numbers and insurance, and this type of scam.
I'm not attempting to discourage those who feel most comfortable owning PMs and storing them in or around their homes, but the hysteria surrounding all other possible options is just that.
Guess what? You don't own your backyard, either.....
Tinky,
please do not take this the wrong way, two words, Nationalization, and Confiscation, = your screwed.
No chance that happens in countries such as Switzerland and Singapore.
Why? Because the Swiss army is going to fend off the rest of Europe with their pocket knives? I will concede that Singapore would whoop China's ass in a straight-up fight.
They've held off enemies for 400 years. How long will YOU hold them off?
The Swiss can field an army of an equivalent size to the US army.
Far larger than anything the rest of Europe can put together.
*you're
Yeah, I know. But c'mon!
20 downvotes and not a single substantial rebuttal. Interesting.
It already happened there once, check your premises.
@Tinky,
Gold takes up such a small amount of space. Why would you take all of that risk to not store it where you live? I can think of about 15 things that could go wrong in your chain of actions to even touch your gold if you stored it elsewhere.
a) there are several clear advantages to owning in a vault, namely security, and being able to sell or ship quickly
b) it's fantasy to believe that one day, out of nowhere, the governemnts of Switzerland or Singapore will confiscate foreign assets in their vaults
C) it's also fantasy to imagine that either country will be invaded out of the blue
There will be plenty of time for anyone paying attention to sell or ship gold from those jurisdictions during the next appreciation phase. If you want to hold it forever, then perhaps your backyard is the best option.
Sadly, too many take a purely emotional or quasi religious view, because they fail to weigh the facts objectively.
They project their worst fears onto a distant land and culture they little about. E.g. they either don't know or ignore CENTURIES of safe gold keeping in Switzerland, yet paradoxically ignore the fact that it was the US itself that nationalized gold back in 1931.
I have to ROTFLMAO, when I hear some ignoramus telling me about the safety of keeping it in the US.
Being a rational and thinking person who likes to analyze and mitigate risk, I hedged my bets by keeping 90% of my PM well outside the US and its jurisdiction. Fuck you, you DC commies!
Switzerland has shown a propensity to bow to U.S. pressure to disclose formerly confidential banking information. It's not such a leap to conclude that they would do so in the future regarding disclosure of precious metals ownership, especially if U.S. operations of their banks were threatened.
Although your physical metal may be safe in Switzerland, your well being could not be said to be in an similar state once your ownership of a (hypothetically) illegal asset has been disclosed to the inquiring parties. Pressure could certainly be brought to bear upon you that would cause you to request the speedy repatriation of your metallic assets. Rather than the risk of such an occurrence, exercise of discretion and physical possession seems preferable.
I appreciate your effort to provide a serious response, as opposed to the reflexive hysteria that permeates so many ZH contributors on this issue. Having said that, I find your analysis to be less than compelling.
While Switzerland has bowed to U.S. pressure within its banking sector, I am not suggesting that anyone store their gold within the banking system. With respect to your hypothetical, I find it virtually inconceivable that the U.S. will make gold ownership illegal. It is far, far more likely that the Government would raise taxes on its sale. In either case, though, there will have been significant appreciation prior to such drastic actions, and, in my view, anyone who is paying close attention will have already sold or traded their PMs for other hard assets prior to the tipping point.
I certainly do see the wisdom of closely monitoring the situation, and keeping an open mind about a possible switch from vaulted and allocated to holding PMs personally. But at this juncture, unless one if talking about small amounts, the advantages of holding them offshore under the conditions that I have described above are impossible to refute.
With respect to your final points, speedy repatriation would be no problem, if necessary, and the disadvantages of physical possession (e.g. security, lack of insurance, inability to sell immediately into the world market, difficulty in shipping, etc.) remain unpalatable to some.
LOL- I'm sure that more than a couple of Jewish Germans who thought that storing their gold in Switzerland was a "safe" idea circa 1936 would find your point of view precious.....
But hey, it's guys like you that keep stories like this alive- keep believing in your fellow man, mate- everybody plays fair, uh-huh....
Assuming that this is representative, remind me to ignore all of your analogies in the future.
So being angry about central banks stealing depositor money while debauching currencies and not prosecuting fraud is hysteria?
Are you really that obtuse? The hysteria is that the only safe place to store PMs is in one's own home.
So who is dumb enough to pay interest on a partial purchase of precious metals they don't take physical posession of?
There have to be middlemen here, fund managers or investment bank go-betweens who were pedaling this shit to senior citizens.
Are the S.E.C. and C.F.T.C. going after them? I doubt it.
Corzined!
Ignorant people who can't afford an ounce of gold outright.
They should just be buying silver coins.
Did you read the article?
When will people wake up and smell the coffee? You WILL get Corzined if you let some one else hold your gold (or that something representing gold). You will either lose it all or get cashed out at the old "commodity" price just before the grand finale.
Every other month (seems like more often lately) stuff just goes poof. But i guess there will be lots of people asleep until they wake up.
Next thing you will be telling me is that there is nothing backing SSDI except pile of IOUs for fiat toilet paper...
International Gold And Bullion Exchange rises from the dead.
"...where else can it possibly be (certainly not in the 5th subbasement of 1 Chase Manhattan Plaza housing the largest gold vault in the world)..."
oh what barbarous webs we weave.....actually, much of that gold is in rockefeller nazi confederates' basements....if you really think that banksters think gold is a barbarous relic, you are a fucktard. they have been raping gold stocks for their personal accounts....
Gold run in 3....2....
run up or down, and why?
What do I do if my throne is made of gold? I guess I could just keep sitting and watch you fellas have boating accidents. Just please don't splash too much, I don't want my canoe to tip ... this throne is heavy as hell.
you made a toilet out of gold!!
Like Elvis. Died on it, too.
Hunter Wise called me about 6 months ago trying to sell me gold using leverage.....and they would hold the metal for me....yeah right. I hung up on them. I only hold physical that is in my possession. Howver, I would consider holding if I could actually visit and see my gold at a vault such as Via Mat or Brinks. Oh....anyone seen my new (as of today) favorite gold price site? http://www.gold-price-girls.com? Love it!
Anyone have any experience with either Via Mat or Brinks?
Told you, Months ago.
You know what I'm gonna do? Travel. Relax and do what I might not get a chance to do when I'm retired. I have my PM's in a safe place at the bottom of a river, I have food stocked up. Screw it, my money may not be worth diddly squat when I'm 65,67,70 whatever retirement age they make up between now and then. I'm going to enjoy some of it. I've been following ZH for four years now, I'm getting burnt out. I see some of the old regulars, Chumbawamba, Cheeky Bastard, and others, not showing up as much. I think they may feel the same way.This shit has been going on for a long time. It's going to continue going on. If you think you can change it, smoke another fatty. All you can do is prepare, then give your kids all the love you can, because when this sucker hits it's gonna be a real shit storm. Take care guys, I'm going on hiatus for a while.
Enjoy the break.
I do give my kids all the love I'm capable.
Good for you, my friend, I celebrate your decision. Life is a lot more indeed than finance and assets. :)
Visit Venice. Do not miss Venezia.
When the time comes for Gold and Silver, be prepared for more of these scam operations who will offer to hold your PMs. And, as with all precious commodities, be prepared for fakes. There is a reason that Silver Eagles have a premium over generic bars. The other odd thing is that junk silver will carry a larger premium in the future because it will be the easiest thing to exchange. What will really be fun is to see whether there is a sudden demand for cutlasses capable to cutting up a Silver Eagle into 'Pieces of Eight'...
in gold, in silver, Google image-search is your friend. CombiBars take away the need for your suggestion
No problem here. Just checked the Um, um, canned groceries. All stocked well.
THERE IS ONLY ONE PLACE TO KEEP YOUR GOLD AND SILVER. ONE!. It is not difficult all. Come on.
yes but it aggravates my hemorroids
MARC FABER: Not Even Gold Will Be Able To Save You From What Is Coming
Read more: http://www.businessinsider.com/faber-gold-wont-be-a-place-to-hide-2013-3#ixzz2OmqsZhP6
Now back to my Bioshock Infinite
Not if you don't have it in hand, DUH!
Probably not.
But I intend to last as long as I can, and my various metals (gold, silver, lead) will help extend that time.
And The Liberties You Thought You Had ?
"Guess what Suckers: You Don't! Hahahaha!!!!"
- Janet ;)
Where can you walk into a dealer and actually BUY gold? I see places advertising that they will send it to you, but I dont even believe them!
Unless you live in the middle of nowhere, there is most likley multiple coin shops near your house that will sell bullion. There is one 5 mins down the street and they have bulk ASE's canadian maples, buffalos, us legal tender gold coins that i'm drawing a blank on (liberties?).... just do NOT BUY numismatic (sp? aka - collectors coins that are worthless basically) if they try to sell them to you. Do some research....
There's a story about this guy who played the numbers for 20 years. He placed his bet each day with the guy who ran the newspaper stand outside the lobby of his office building. The day after he finally hit a winner he went to the newspaper stand and it was closed. He never saw the owner again.
Last I heard, the newspaper stand operator was running a gold ETF.
And what's with all these retail stores opening up in the bombed out empty strip centers (with the obligatory sign spinner on the corner intersection) offering "top dollar for Gold and Silver". Does anyone have the lowdown on these guys?
Yea, they're retail aggregators who know which side of a physical PM transaction is the right side to be on. Most of them in my area are jewelers who have morphed into gold and silver traders, because, no one has any money to buy jewelry anymore anyway. These guys typically pay anywhere from 55%-75% of the value of the actual gold and silver content in jewelry, silverware, old silver sets, etc. and then sell it on to refiners in bag loads for a marginal profit.
We have them here too. They even send solicitors door to door. I asked for a bid on a 1oz maple. Figured that would be an easy assay. She called the shop. They quoted 40% of retail.
Racket? Hope to shout!
Where do you think Germany's "U.S.-held" gold is coming from?
Alright, I gots to know..! Which one of you clever sarcsters is 'Deep Thoughts by Ben Bernanke'?
I've never had a problem with Albern Coins up in Calgary,Alberta,Canada.They openly welcome American business.Also Mint.ca(Royal Canadian Mint) is good for some low mintage coins.Spent thousands at both,never had a problem.You can also look at ScotiaMocatta and their e-store,it's a division of The Bank of Nova Scotia,they are a pretty big bullion dealing firm but also deal in small amounts too.Never hurts to know more contacts,especially a few in Canada which is American cousin friendly.
Funny that, my family had a few 1 ounce gold pieces, purchased from the Bank of Nova Scotia. A couple of them started rusting in their little plastic storage folders (35 years later). Albern paid full spot price for them rust and all.
Gold doesn't rust. If you have rust on the coins, they are not gold.
duh
I'm wanting to move my assets from PM ETFs to coins (in my possession) Anyone have any good recommendations for buying silver coins at as close to spot price as possible (not collectables)? Thanks!
I hear Jon Corzine of MF Global fame can help you take PMs at spot price....
Type "90% junk silver bags" in Yahoo search engine. See the big retailers, compare. Open yellow pages, call "coin shops", call local retailers, ask the same over phone.
APMEX Royal Canadian Mint 100 oz. bars:
http://www.apmex.com/Product/57949/100_oz_Royal_Canadian_Mint_RCM_9999_F...
I've seen Liberty Rounds go at spot on eBay. Generally in lots of 10 or more coins. Usually in a falling market. But know what you are doing!!! Get to know the seller, and check his ratings.
Chinese fakes are everywhere, as is fake US Junk Silver, usually dollar coins, but as small as quarters, complete with wear. A good eye can usually catch them. (Loupe)
Play detective to save $1.99 per coin or pay a reputable dealer to assure authenticity.
https://www.youtube.com/watch?v=wnMZiUqi9ss
I had a conversattion with a buddy that my fractionals are gonna be worth more then his 1 oz.
If push comes to shove, they are gonna charge a premium to make change.
Fractional gold coins will be in demand.
So will ammunition.
Yes, the Canadian dime size coin is the best! How ya gonna make change for an ounce???????????
I've got a free blog that focuses on Canadian junior miners. If you're interested, take a peek!
http://miningmuppet.blogspot.com/
Thanks, ZH.
Junior miners, bitchz!
I've been buying Silver coins for a few years now.
I will be buying/bartering/trading probably no further than 5 miles from my place here, most of those people stack silver coins.
Working out a system to use your PM's is actually more important than owning them.....
Hoooop, WHERE it Is?
the WALL STREET definition of a gold mine, is " a hole in the ground with a liar standing in front "
As the commericial says only Coke is the real thing.
what percent of the law?
buying pre65 coinage at the local coinshop the other day, they were OUT of quarters entirely, i had to settle for dimes.
first time they were ever out of anything far as i know.
dont be tossin those pre81 pennies away just yet....
JWR has a good posting from December 2012 about nickels.
Anytime I make a purchase in the store and I'm getting $2 or more in change ill ask if I can have that roll of nickels.
$0.0494017 is the melt value for the 1946-2013 nickel on March 28, 2013
This is down recently along with the price of copper, however it's still $1.96 worth of metal in exchange for $2.00 paper fiat.
http://www.survivalblog.com/nickels.html
Besides if someone finds my great big box of nickels they will likely incur a lumbar spine injury trying get them out of my basement any faster than a day.
The smaller inconspicuous box in the other Room has (or did, until that last boating accident) my other coins
Up to & including 82 on the pennies.
www.coinflation.com
Keep buying the Physical folks. We will SMASH the paper shorts.........
deep storage gold
and you don't own your gold either, even though you can hold it in your hands. fdr already set that precedent.
Flush your gold down the toilet .... if you have a cesspool .... when the honey pumper comes .... have a rabbit cage galvanized wire cuff handy to place over the suction nozzle .... if driver asks too many questions .... be vague and evasive and start some gay flirting .... he'll leave !
Gold and silver cannot fix our problems. What they will do however is give you a degree of anonymity, flexibility, portability and desirability which mst other asset classes cannot give you especially if this world goes crazy and you find yourself having to leave your home in a hurry.
dp
When it gets that bad, people will be murdered if caught carrying gold. Swallow diamonds and other gems.
I think silver and gold can be used as currency in Nevada and soon maybe Arizona. So why would people not hold onto their gold and silver? I don't get it why does anyone buy paper gold and silver. I mean even if you have a couple million dollars of gold it doesn't take up much space so what's the big deal.
@q99 the answer to your question in this case was greed. if you've got $1650 you can buy one krugerrand and keep it in your pocket, but if you lever you can "buy" ten which you will never see - but perhaps make a bigger profit eventually.
boca raton...
not surprising
Ah, yes. The same model as GLD and SLV.
Notice to everyone storing their gold at home.
Please take part in our survey and send the address where the gold is located and the quantity to henryhub@aol.com. This information will be used for scientific purposes only and will be kept in strictest confidence. Thanks in advance for you cooperation.
Bernanke to Dimon on entering 5th floor sub basement:
"Cuddle up angel cuddle up my little dove
Well we'll ride down baby into this tunnel of love".
BEWARE OF MONEX and fabulous Atlas account [margin] product. They: comex , jpm, monex and the rest of the sordid players are guilty of blowing up that nice silver bubble (50$) and then popping it. Its called manipulative thievery. RICO these MFers. Its seems "bubbles" are what this country the best these days,along with shoddy wars. In closing, my money thats in limbo each and every anxiety ridden day was to be used to start my buiness ,further my education and oh yea my retirement at the end.All are on hold or are dead . I hope your happy THIEVES! BEWARE MONEX!!
BEWARE OF MONEX! their Atlas margin product and their "priceless' expert advice(30k and running). With the help from comex cftc jpm and other sordids they blow a pretty mean bubble(50$to 26$) The mofo's should be RICO'd but they are probably to big to jail. Meanwhile the money in limbo was to be used to start a buisness,further my education and eventually retire. Because of the silver trap I dont even want to be involved in anything this world has to offer (almost). I hope you OPM mofo's share my level of misery ,sooner the better. Liquidation has begun just to cover,but you guys love when that happens.In closing Beware of MONEX and their "priceless "advice"