WHY GOLD DEALERS ARE MAKING YOUR NAME ACCESSIBLE TO THE GOVERNMENT

by Nicholas Wright, Lucid Gold Would you be willing to sacrifice a little bit of your customer’s privacy to protect yourself and your business? What if your family and your employees are relying on your enterprise? This is the question that has gold & silver dealers between a rock and a hard place. As Federal Government regulations are forcing coin and bullion dealers to choose between risking their business & exposing increasing amounts of their customer’s information to the government. For too long, there have been certain facets of gold buyers privacy which have been consciously not brought up nor mentioned. Not any more. HOW CRIMINALS KILLED GOLD BUYING PRIVACY At this point, we’re guessing you’re probably asking, “What The H*ll is Going On?”. Let us explain. Since January 2006 gold dealers are required to have anti-money laundering practices in place. These practices were put in place to help prevent terrorists, drug lords, fraudsters, and criminals from being able to launder money. In order to be in compliance, gold dealerships are required to establish anti-money laundering programs, which at a minimum must include:

establish anti-money laundering programs, which at a minimum must include: 1. the development of internal policies, procedures and controls; 2. designation of a compliance officer; 3. an ongoing employee training program; 4. and an independent audit function to test programs. [source]

Why is the government requiring this? Because gold dealers are huge targets for criminals to launder cash. Criminals know that gold & silver are virtually untraceable and can thus help wipe their dirty cash clean. What Is Money Laundering? “The most simple definition of money laundering is “taking illegal proceeds and conducting a series of financial transactions with those proceeds to make them appear to have come from legal means.” – [source] HOW & WHY GOLD DEALERS MAKE YOUR NAME ACCESSIBLE TO THE GOVERNMENT As a part of AML compliance, gold dealers are required to not do business with anyone named on a government list called the Specially Designated Nationals list (the ‘SDN’ list for short). This is a list of people, companies, organizations, or other entities that U.S. persons or companies cannot do business with for one reason or another (many names are allegedly linked to terrorism). In order to ensure people aren’t doing business with any SDN’s, OFAC has provided this nifty search tool. All you do is simply input the name of the person, and the tool will tell you if they are on the list or not. As we mentioned, gold and silver dealers are not allowed to do business with anyone on this list. In fact, most dealers have structured their payment methods in such a way that the probability of doing business with an SDN is tiny (and we are talking teeny-tiny). This is why for most online dealers you cannot pay with $10,000.00 USD or more with cash or cash equivalents like postal money orders, etc. Bullion dealers want to be paid with capital that is within the banking and financial industry’s know your customer anti-money laundering system. BUT many dealers choose to search your name in the list anyway as an extra precaution. WHAT IS THE GOVERNMENT DOING WITH YOUR NAME? This raises the question, is the government doing anything with the names searched? If they wanted, the government could easily track the names that were searched, the computers ip address, and other identifiable information. Could this information be used down the road to track those who purchased gold? Do we sound like we’ve boarded the paranoia train? Of course those questions are speculation on our part. Is the government saving those searches by gold dealers? Maybe, maybe not. But knowing the government is tracking your emails, is it really that big of a leap to guess they might be saving what someone searches in their database? Could this database be used in the future to identify gold & silver buyers? Continue Reading>>>

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