By Everett Millman – Gainesville Coins …….
Switzerland has long had a reputation—sometimes a dubious one—for being a safe place to stash one’s wealth away from the prying eyes of tax authorities. Right or wrong, the notion of a “Swiss bank account” is synonymous with evading taxation.
Now, the ultra-rich seem to have discovered a new option for protecting their wealth from would-be taxes: gold vaults hidden in the Swiss Alps.
Secret Alpine Gold Vaults
There are roughly 1,000 idle military bunkers residing in the mountains in Switzerland. A handful of these have been converted into secure gold vaults by a high-end storage company as a way for wealthy clients to keep their precious metals out of the banking system. Under U.S. tax law, gold held abroad doesn’t need to be reported by American citizens.
Bloomberg provides a comprehensive explanation:
“Demand for gold storage has risen since the 2008 financial crisis. Many of the wealthy see owning gold as a hedge against the insecurity of banks and a reasonable investment at a time when markets are volatile and bank accounts and low-risk bonds pay almost no yield. It may also be a way to avoid the increasing scrutiny of tax authorities. In high-profile cases, U.S., French, and German prosecutors have gone after citizens of those countries with undeclared Swiss bank accounts.”
According to the owner of one of these gold vaults, who has remained anonymous for obvious reasons, his company boasts the seventh-largest gold vault found anywhere in the world. A firm known as Swiss Data Safe runs a similar operation in the mountains and provides luxurious amenities for its clients.
As a sign of how much interest has been generated for these special gold storage options, the Swiss customs office estimates that a staggering 1,357 tonnes of gold bullion has been imported into the country this year–on pace for an annual record. At least a portion of this gold is likely ending up in these secret vaults. These companies also allow their clients to leave no paper trail of their deposits or transactions.
Financial watchdogs in Switzerland have thus far been unwilling to look very deeply into the matter despite pressure from concerned international groups. While some say these mountainside vaults are a destination for criminals to launder money, both of the vault owners interviewed by Bloomberg explained that they are extremely selective in who they allow to use their facilities. Beyond carefully screening and vetting potential customers, they also scrutinize the valuables being deposited with standards that exceed what companies that offer safe-deposit-box services follow.
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The opinions and forecasts herein are provided solely for informational purposes, and should not be used or construed as an offer, solicitation, or recommendation to buy or sell any product.
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