Standard gold bullion bars are at least 99.5% pure. Standard silver bullion bars are at least 99.9% pure. Standard platinum or palladium bars are at least 99.95% pure. All types will have been kept continuously in professional bullion storage facilities since they were manufactured.
Each bar has a recorded history and an absolute guarantee of its integrity and bullion content.
This works under a system managed by the professional bullion markets and called the chain of integrity.
BullionVault itself also warrants the quality of all BullionVault bars stored in its vaults - both when you buy and for as long as you own your gold, silver, platinum and palladium.
Bar sizes for gold are variously:
The silver bars are 1000 troy ounces (~31.1kg).
Platinum and palladium bars are between 1 to 6kg (32.2 to 192.9 troy ounces).
Gold bar purity is measured, and only the purity multiplied by the gross bar weight is added to BullionVault inventory records. So your gram of 'fine gold' is guaranteed 100% pure gold held in the vaulting location of your choice. In accordance with standard bullion-market practice, silver, platinum and palladium are recorded in gross weight, not fine.
Your gold, silver, platinum and palladium are held in some of the world's strongest and most trusted specialist bullion vaults, operated on our behalf by professional market vaulting providers.
You choose in which vault your bullion is stored from one or more of the following locations:
These locations cover the most active bullion markets in the world and give you an opportunity to select an offshore jurisdiction for storage.
You buy your guaranteed quality bullion only when it is already safely in the vault. Bars are always insured and they do not move. Even in the course of delivery from BullionVault seller to buyer the bullion stays securely in the vault.
You can at any time prove your individual ownership of bullion in the vault by comparing the official bar list produced by our vault operators to an individually nicknamed list of all BullionVault holdings published on a public page on the BullionVault website.
You may be surprised that your gold, silver, platinum and palladium are not stored in a vault run by a bank. Why not?
The short answer is that nowadays banks operate the wrong kind of business to be willing and reliable custodians of your precious metals.
Modern banks make their money by providing credit, and by executing transactions. They have little enthusiasm for a low margin role as physical custodians of bullion. Very few of them actually manage bullion vaults at all.
They will - nevertheless - be pleased to provide you with unallocated bullion which in most cases is probably not the form which properly informed private buyers are looking for. [Click here for a full explanation of unallocated gold]
BullionVault does not provide unallocated gold, silver, platinum or palladium. BullionVault's customers own their bullion outright and on their behalf BullionVault seeks a vaulting system and a custodial relationship which meets the following criteria:-
We believe that the vault operators we select fulfill these criteria to the very highest levels and provide the most solid and responsible of custody environments.
In the vault your bullion is soundly protected.
In a vault gold, silver, platinum and palladium are so secure that they are extremely easy to insure, and not expensive.
The vault operator provides the insurance and the evidence of that insurance is available to be viewed on the website.
The cost is included in your custody charge.
Government action against gold owners can be a material risk. This is why BullionVault enables you to secure your gold offshore and to transfer its location at minimal effort as risks in given locations change.
It is very difficult for a government intending domestic gold confiscation to apply it on gold held overseas. Conversely it is surprisingly easy where property rights depend on domestic legal arrangements.
With offshore storage it is important that foreign held assets are not subjected to military or political threats. In different ways Switzerland, Britain, the United States of America, Canada and Singapore are marked in their suitability under these criteria.
All BullionVault customers - wherever they live - can benefit from offshore custody by making an appropriate choice of storage location. Residents of these countries also have the option of domestic storage if they prefer it.
Your account is protected by some of the most secure cryptographic methods ever devised. These are widely recognised as offering a thoroughly secure means of data communication and are the technical protocols in wide use by banks, governments, and other highly secure users of the internet.
But we do not accept that the ciphers could not in future be broken, or your passwords found out.
Because of these very real risks BullionVault has assumed that against the odds your internet access will be compromised, and we have implemented substantial further safeguards to guard against such an eventuality so as to still keep your bullion and your money safe.
When certain events occur on your account, BullionVault can send an SMS message to your mobile/cell phone to keep you immediately informed. We call this the 'burglar alarm'. It allows you to monitor your account even when you aren't near a computer.
Provided your account is funded and your mobile/cell phone number is set correctly, we will automatically send an SMS message whenever:
You can set up your mobile/cell phone number and enable/disable the optional messages from the ACCOUNT > SETTINGS page.
Note: Your phone number must be entered in full international form for these messages to reach you. For example: +1-555-204-5151 or 00 44 7555 123 456.
There is a nominal charge for the optional messages. Please see our tariff for details.
Even if someone broke through your account security, and your burglar alarm, there is a final failsafe security measure - the restriction on the destination of withdrawals from your account.
In normal circumstances [see exceptions] we only allow money which might be raised on your BullionVault account (i.e. by selling your bullion at the market price) to be returned to the bank which originally funded your BullionVault account - i.e. yours.
It would be inconvenient for you, but not catastrophic - and because the criminal would not profit there is little incentive to go to the effort and risk the consequences of detection.
This is a failsafe characteristic which provides you with considerably greater security than is possible from your bank. After all, your bank probably has to effect payment on your behalf to hundreds of different places in the banking system. It cannot switch them off and still be useful to you. We on the other hand can switch them all off, and we are much more secure for you because of it.
Every day BullionVault publishes the proof of your ownership on-line.
We take the current bar lists and reconcile them exactly to BullionVault's records of clients' gold, silver, platinum and palladium, and we publish the proof on our Daily Audit pages for your inspection - every day.
We want you to be 100% confident in BullionVault records, so we have our own Daily Audit checked annually by our own external auditors - Armstrong Watson. They examine our procedures, confirm our arithmetic, check that the vault operators issued the bar lists, check that the banks issued the bank statements, and then publish their report on us on their own website - so when you read it you'll know that it is properly and independently produced.
We believe this proves beyond argument that your bullion holding are part of the bullion held independently of us by our vault operators, as "BullionVault Client" property.
BullionVault is the only bullion business in the world which daily publishes a proof to independent third party documents, and also the only one which requires its auditors to publish the verification on their own website. It is the most transparent public scrutiny policy you will find anywhere on Earth.
You can check up on Armstrong Watson themselves at the website of the Institute of Chartered Accountants for England and Wales.
Taking the BullionVault commitment to record keeping transparency, together with the burglar alarm, the integrity of our vaults, our insurance arrangements, the single route out for your money, the offshore storage capability, rapid transferability, and other elements of our security features, we believe we have produced the safest environment on Earth for our customers to store their bullion.
Ownership of your gold, silver, platinum and palladium in BullionVault is outright. BullionVault bullion is not subject to a trust deed, and it is not anyone's liability. It is - quite simply - your outright property from the instant you buy it to the instant you sell it.
In accepting the BullionVault Terms of Business you have engaged BullionVault as a custodian of your bullion. BullionVault has subcontracted the physical custody of your bullion to the vault operators. BullionVault has retained responsibility for administration and record keeping, which is performed through the BullionVault website.
You can see the official bar lists on the BullionVault website, and reconcile them to the BullionVault customer-by-customer records. You should also know that in their agreements with BullionVault the vault operators fully acknowledge that the bullion shall remain the property of BullionVault clients at all times.
These are unusually strong property rights for you because there is no intermediation via trusts or company balance sheets. The bullion is your personal property and is treated under English law as a "bailment".
In English law a "bailment" occurs when a person [the bailor] delivers physical property into the possession of another person [the bailee] on condition that the goods are either returned to the bailor at some later agreed date, or disposed of in accordance with the bailor's instructions. The essence of a bailment is that the bailee [a custodian] has physical custody of goods but they remain the outright property of the bailor [you].
The bailment is founded on old and well established trade laws. Ancient courts decided that transferring goods to a custodian did not grant a property right to the custodian, or to its creditors in the event of the custodian's failure.
Instead the property remains that of the original owner until it is delivered according to the bailor's [your] instruction. Failing successful onward delivery the property would be returned in full to the bailor [you].
If you've not heard of a bailment it's because they are now uncommon - especially in the investment world. In law a bailment is restricted to physical goods which can be owned outright through possession. A bailment cannot apply to entitlements evidenced by stock certificates, trust deeds, unallocated accounts, futures or other bookkeeping entries. With these the possession of a piece of paper does not grant the basic property right, because the actual value of what is owned is abstracted from the paper itself.
So bailments - and the outright property rights they confer - are not widely applicable to modern securities like stocks, shares and even gold certificates. Instead modern securities law is based on contracts, trusts, deeds and increasingly complex case law.
All of these constructions are far more complicated than owning some physical material. Indeed key clauses in contractual and trust agreements are frequently struck out by the courts, which insist on their right to interpret complex documentation and its wider legal meaning.
There is simply not the same potential for future argument with a bailment of physical goods. It remains the legal property of the bailor [you] and this inalienable property right is soundly established and tested in law. Over several centuries there is very much less case law on the subject of custody bailments than on the subject of trusts, because there is much, much less to argue about than with a trust or deed.
Owning your bullion in this way gives you the soundest protection from business failure.
When businesses fail liquidators are appointed to take control of the company's assets, sell them and arrange a fair distribution to creditors of various classes including themselves. Liquidators generally claim ownership of every asset on a failed company's balance sheet (which would of course include unallocated bullion). However they cannot lawfully treat bailments as the property of the company available for creditors' benefit.
Should they try to do so any dispute would be resolved - perhaps even in court - by reference to several key pieces of evidence.
Money in any bank account does not have the protection of bailment law. So your money has to be protected in different ways against (i) the failure of BullionVault and (ii) the failure of the bank.
To protect your money from BullionVault's failure your un-invested money is held at Lloyds Bank or Wells Fargo in a segregated and pooled trust account designated 'CLIENT'. Under English law a bank may not consider the money in a trust account designated 'CLIENT' to be offset against debts which BullionVault might incur in running its business.
You can view copies of our bank account trust deeds here.
To make this arrangement still safer BullionVault uses three completely separate banks. All client money is held at Lloyds Bank (UK) or Wells Fargo (US). BullionVault's trading commissions accumulate there too, and are periodically paid into our Barclays Bank account, from which we then pay our operational costs.
Every transfer of money to the Barclays account is verified by the next day's published DAILY AUDIT of the BullionVault Client Account, publicly proving that we never allow your money to fund our business.
The BullionVault Client accounts are potentially exposed to the failures of Lloyds Bank or Wells Fargo.
Lloyds Bank is one of the largest of all UK banks, currently part-owned by the UK government after it acquired HBOS to become the Lloyds Banking Group in Dec. 2008. Measuring bank reliability is the business of the credit rating agencies like Moody's, and their analysis now puts the Lloyds Bank division (where BullionVault keeps its client account) at Aa3, indicating that it is subject to low credit risk and has a good capacity to meet its financial commitments.
Individual client deposits, including those of non-UK customers, may qualify for statutory compensation in the event of Lloyds Bank's insolvency, up to the £85,000 statutory limit. Any such insurance, if it were paid, would be according to the Financial Services Compensation Scheme, broadly equivalent to the United States' FDIC.
Wells Fargo is one of the largest banks in the United States, having merged with Wachovia Bank in 2010. It was rated as Aa2 by Moody's (as of August 2019).
Individual client deposits, including those of non-US customers, may qualify for statutory compensation in the event of Wells Fargo's insolvency, up to the $250,000 statutory limit. Any such insurance, if it were paid, would be according to the FDIC (Federal Deposit Insurance Corporation), of which Wells Fargo Bank is a member.
All BullionVault client money is available at short notice and can typically be returned to validated users by the end of the business day following the request. But as with any bank deposit, cash in the client account is potentially exposed to a bank failure. Owning bullion, in contrast, gets you off risk – which is one reason we're in the business of providing physical bullion ownership to private individuals.
While it is in a BullionVault client account at the bank your money - like all money held in bank accounts - is subjected to a risk of the bank's own insolvency - but not BullionVault's.
But BullionVault gold, silver, platinum and palladium is yours outright, so there is no credit exposure either to the bank, or to the vault operators, or to BullionVault. All three could fail, and all your bullion would still be yours and would be returned to you in full by a liquidator. This is the essence of direct physical ownership of bullion held through BullionVault's custody arrangement.
BullionVault Ltd © 2023
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