Metal accounts - cheating or not?

So-called metal accounts are different - Allocated and Unallocated.

- In the first case - (Allocated), the owner stores his own physical gold, assigned only to him, a contract of storage of valuables. This means that if you put on storage-specific ingots with specific numbers or specific gold coins, specific years, then you will get them from storage. If you do not decide to sell them at some point without receiving them from storage - which in half of the cases happens.

- In the second case - (Unallocated), you do not own gold, but only conditional OWNERSHIP for a certain volume of gold by its weight.

At the same time, your conditional ownership of a certain weight of gold is valued in CURRENCY. Therefore, there are no strict obligations to supply or give you physical gold, in this case. Unless otherwise stated in the Contract. But, as a rule, non-distributed storage contracts - (Unallocated), provide the service provider with the disposal. That is, not you, but the provider of services decides at its own discretion, to give the client physical gold on the hands - as the fulfillment of the obligation in kind; Or hand over to the client the market value of this gold expressed in the currency of the Contract.

At the same time, the issuance of the client's deposit in the form of money is the responsibility of the service provider. And the issuance of the client's contribution in the form of physical gold - is a dispensative right of the service provider. Which the service provider may or may not implement it at its discretion.

Sometimes, (as in the case of OMS Sberbank), the service provider limits the customer's ability to obtain physical gold, in some way. For example, the condition that physical gold can only be given to the customer by a full lot. At the same time, the concept of "full lot" itself is defined by the contract as the volume of gold, in the amount of not less than 1 million euros. Thus, the service provider puts an artificial economic valve to its customers, which prevents customers from getting gold on their hands, in its physical form.

In the case of the OMS of Sberbank, such an economic valve is the need for the customer to pay an additional amount of VAT - when receiving a gold ingot on the hands.

Why is this position of Sberbank precisely an economic valve aimed at preventing OMS clients from obtaining their gold on their hands?

Because owning the monopoly right to distribute VAT-exempt national gold investment coins Georgy Victorionets, issuing gold with OMS these coins, Sberbank does not offer to its clients.

Thus, in the case of single-stage purchase-sale of metal "in one window," the owner of OMS is forced not only to suffer losses on the bank 's spread - about 10% of the transaction amount but also to pay VAT.
All this together leads to the fact that obtaining physical gold from OMS is not a hand, turns out to be extremely unfavorable for the client and therefore unattractive, in terms of the investment interest of the client.

Economic valves preventing the production of physical gold on hands are introduced everywhere primarily because today, every existing gram of gold in the world, on paper has already been sold 107 times.

This means that if not all, but at least every 10th owner of the so-called "paper gold," requires a physical supply, it turns out that such an amount of gold, in the world simply does not exist.

It is for this reason, Michael Maloney, is the author of "A Guide to Investing in Gold and Silver," writes:

- If you can hold your gold in your hands, then you have gold.

- If you cannot hold your gold in your hands, then you have no gold.

As for KDG Gold, the company offers its clients both investment gold coins and investment ingots of gold from the world manufacturers of certified LBMA, excluding VAT - in accordance with the legislation of the EU and Cyprus.

However, KDG Gold does not provide any form of gold storage services.

Therefore, KDG Gold customers have the right to independently determine and decide all questions about where, how and on what terms, they will store their gold. Gold coins and gold ingots purchased from KDG Gold are owned exclusively by our customers on the basis of their personal, full, absolute and non-restricted ownership rights documented.