Submitted by Ted Baumann via TheSovereignInvestor.com, [4]
Most of us remember cowboy movies in which a lonesome desperado acquires a sack of gold coins that everyone else wants. It’s a thankless task that typically doesn’t end well.
I vividly recall the final scene [5] from Sergio Leone’s The Good, the Bad and the Ugly, in which a long rifle shot from Blondie (Clint Eastwood) severs the hangman’s noose holding Tuco (Eli Wallach), sending him face-first into a pile of gold coins. It’s still memorable even after I learned it was filmed in the Spanish plateau region of Burgos, not the U.S. Southwest.
Besides reminding us that gold has always been a much sought-after commodity, The Good, the Bad and the Ugly’s multinational production process illustrates another key principle of the modern economy: People move around a lot when they’re making money.
And that creates the perfect opportunity for governments to get their greedy hands on your gold [6].
Traveling With Gold
Let’s start with a review of U.S. rules regarding the importation and exportation of gold bullion, whether in bar or coin form:
There is no duty on gold coins, medals or bullion but these items must be declared to a Customs and Border Protection (CBP) Officer. Please note a FinCEN 105 [7] form must be completed at the time of entry for monetary instruments over $10,000. This includes currency, i.e. gold coins, valued over $10,000. The FinCEN definition of currency: The coin and paper money of the United States or any other country that is (1) designated as legal tender and that (2) circulates and (3) is customarily accepted as a medium of exchange in the country of issuance.
Note the specific definition of “currency” here. These rules only apply to gold coins that can be used as currency. Taking collectible (numismatic) coins [8] out of the U.S. requires that you submit Electronic Export Information [9] (EEI) to the Census Bureau, ostensibly to help compile U.S. export and trade statistics. This form is actually required for any exported commodity, including gold, with a value exceeding $2,500. There are similar rules regarding jewelry.
Global Gold Crackdown?
Most foreign countries have similar regulations concerning the import and export of gold bullion [10] and collectible coins. These regulations tend to track U.S. rules closely, and generally, as long as people follow them, there isn’t much friction over international travel with precious metals.
Recently, however, I’ve been hearing reports that some foreign countries are starting to ask more questions, and require more searches, when someone declares that they are transporting gold or other precious-metal coins. For example, some countries in Latin America — including financial basket-case Argentina — are reportedly quite interested in any unusual coins you’re carrying — even if they’re under the limits and therefore not declarable. Seeing them in an X-ray of your bag may be enough to trigger a search and interrogation.
Then there are increasing reports that many banks around the world are beginning to amend their contracts to prevent clients from storing currency and precious metals in safe-deposit boxes, or stating that they will not be responsible for them if they are kept there. For example, Chase Bank recently started a pilot program to this effect in Cleveland, prior to rolling it out nationally.
What’s going on? My guess is that the U.S. and other governments are starting to put in place the elements of a capital controls system. We already know that the Foreign Account Tax Compliance Act (FATCA) is building the infrastructure for capital controls in banking. That leaves cash and precious metals as the two remaining methods to transport value physically. Transporting large amounts of cash is already heavily regulated, leaving one more — gold and other precious metals. It’s not paranoid at all to think that the U.S. government is quietly working with other customs agencies to increase “awareness” of the gold-movement “problem.”
The Only Problem Is Government
Of course, traveling with gold is a “problem” made by governments. If they behaved responsibly, let economic processes take their course instead of propping up big banks, and treated their citizens with respect, there would be no problem at all.
If you plan to carry any gold or silver currency or collectible coins out of the U.S. — why bring them back in? — my advice is to contact the nearest office of the U.S. Customs and Border Protection Agency [11] and explain what you plan to do. Ask them to explain in writing how you can conform to the law. You can show the written response if questioned by CBP agents, who may not know the rules. Also keep handy any customs paperwork from other countries, as well as a proof of purchase or bill of sale.
[11]
Remember, traveling with gold isn’t illegal. There’s no reason to end up like Tuco, who just wanted to get away with his gold.
