Systemic Crisis Vaulting and 10 key questions it is based on
Physical bullion allows for direct ownership with minimal or no counterparty risks. This is very different from financial products that convey the status of "unsecured creditor" to the purchaser.
However most storage solutions treat bullion like a financial product rather than an owned asset and greatly devalue its main purpose - to protect your wealth in systemic crises. In some cases, the underlying asset might not even exist, or is leased out to other institutions or has hundreds of concurrent claims against it.
This "Unsecured Creditor" versus "Asset Owner" distinction becomes very important because financial products normally involve multiple counterparties and, should one link in a counterparty chain fail in a systemic crisis, the entire investment could be lost. As most financial institutions nowadays are highly leveraged and highly interdependent among one another, the financial “contagion” risk of one institution’s default causing a chain reaction is quite real.
This interdependence resulted in the “too big to fail” dilemma which came about, as governments throughout the Western world are forced to bail out their overleveraged financial institutions by insuring their debts. However, as we see Western governments themselves defaulting and as the true size of governmental debt and their off-the-books unfunded liabilities are better understood by the broader mass of investors, the risk of a systemic breakdown, becomes ever more possible.
If Western governments choose to continue to provide near limitless liquidity to prevent such defaults we could eventually see a loss of confidence in the currency itself similar to what occurred during Germany’s infamous hyperinflation in the 1920s.
In such a scenario, physical bullion will become highly sought after as, unlike fiat currencies, physical metals cannot be created out of thin air and are accepted worldwide as the ultimate store of value during times of strife. In late 2008, for example, the fear of a financial breakdown caused paper silver spot prices, as traded on COMEX,
to fall to a low of about 9.50 USD. However physical silver demand skyrocketed, causing bullion dealers to stop sales due to lack of supply and causing secondary physical markets (e.g. eBay) to trade silver as high as 300% over spot.
It took four to five months before physical bullion supply returned and this event spurred us to found Silver Bullion Pte Ltd in early 2009 with the goal to bring, authenticate and accumulate bullion in Singapore which we identified as the safest jurisdiction.
Once a serious systemic crisis starts it will be too late to purchase physical bullion because, just as in late 2008, demand will quickly outstrip the tiny physical supplies and the priority for bullion owners would shift from acquiring bullion to ensuring the bullion is safe and unaffected by the consequences of the systemic crisis.
S.T.A.R. @ The Safe House is a huge step in our quest to develop the world’s safest bullion storage system and, as we seek to protect our own bullion just as much as our clients', we have taken no shortcuts to ensure the stored bullion will be safe physically, legally, jurisdictionally and free from encumbrances and counterparty risks.
The following are the 10 key questions - some raised by customers, some from consultations with lawyers and some being common sense -
that S.T.A.R. @ The Safe House was built to address.
How can you make sure that:
1 - you are the Legal Title Owner rather than an Unsecured Creditor, and why does it matter?
Prerequisites for Ownership Status
There is a near truism in the industry which states that “If you can’t touch it you don’t own it”.
This statement is true in most cases because storage solutions which rely on generic quantity or weight counts are, by definition based on an IOU system, making the client, in a legal sense, an unsecured creditor rather than an owner.
In the industry you will often find that bullion storage are categorized in “Unbacked”, “UnAllocated”,
Allocated and in some cases “Reserved” as follows:
- Unbacked, your position is simply a financial bet (long or short). – You are not an owner as there is nothing to physically own. Legally you are an unsecured creditor.
- UnAllocated, there is a small amount of bullion to cover everybody’s claim – You are not an owner as the small amount of bullion is on the provider balance sheet. Legally you are an unsecured creditor.
- “Fully” Allocated, the provider tries to buy or sell bullion to match, with a delay unless they distinguish between in-stock and pre-order bullion, the buying and selling of bullion by clients so that claims are matched with physical. However even in this case you are still not an owner because your claim is still a generic ounce(s) liability against assets held by the provider. You are an unsecured creditor.
- “Reserved”, only when physical bullion is present, uniquely identified and uniquely tracked (not just listed by generic oz quantity) and the bullion/goods are transferred to your name via an invoice to attest the legal title transfer would you be an actual owner under the jurisdiction in which the invoice was issued.
Keep in mind that these terms, other than "reserved" which requires documentary proof, are often used quite loosely and as this is mostly a self-regulating
industry so full allocation often comes down to how transparent the storage system is.
S.T.A.R. Storage has been “Reserved” from the begining and, although more expensive and restrictive, it is well worth the trouble as it is a prerequisite
for clients to be a legal title owners.
"Unsecured Creditor" vs. "Owner" Status and Why it Matters
From a legal point of view, investors are normally unsecured creditors because their money is recorded as a liability with their immediate counterparty which typically will become an unsecured creditor themselves as they transfer funds to other counterparties along the counterparty chain.
As the name suggest unsecured creditors are completely dependent on the solvency of their counterparties which is not a good situation if you seek to minimize risk to protect yourself from systemic risks. The typical exceptions of this rule are real estate – where you receive legal title to your property - and buying and taking home a physical good, such as bullion, yourself – in which case legal ownership was transferred via an invoice.
So if you purchase bullion for storage and do not get an invoice – the vast majority of cases - you can be pretty certain that your status is that of an unsecured creditor because you own a claim, not a physical asset. On the other hand if you receive a valid invoice you would be an owner of the bullion as evidenced by the invoice. To issue an invoice for goods the issuer must be in possession of the goods and the goods must be uniquely identifiable if they remain under custody of the seller.
So a storage invoice stating “monster box of 500 Maple leafs” for example is essentially an IOU because it does not specify what specific box you own nor does it guarantee that bullion exists at the time of the transaction. So ultimately it is a promise. On the other hand a sealed parcel ID SB20005XXX owned by Silver Bullion Pte Ltd containing a monster box would be valid property because it is specific existing asset giving the client ownership of the parcel and relegating Silver Bullion Pte Ltd to act as a storage agent for the client owner.
An advantage to being a legal title owner is that it makes it very difficult and illegal to encumber – see encumbered bullion – your bullion. Another advantage is that your claim to the parcel survives the dissolution of your dealer. In other words if your dealer goes bankrupt you would still be the owner of the parcel and a bankruptcy court would not be able to claim it for creditors whereas, as an unsecured creditor, you would probably have lost any claims you had. Furthermore in Singapore falsifying an invoice is a criminal rather than civil matter making the humble invoice a very powerful document indeed.
However from a dealer perspective issuing storage invoices for physical parcels does not allow for shortcuts and is much more complicated and expensive compared to issuing promises and virtual quantities because:
- An invoice dealer would need to own sizable bullion amounts as buffer as only bullion owned by the dealer can be transferred to a customer and a distinction between bullion in-stock and pre-order would need to be made. In the case of virtual quantity dealers there are no such restrictions allowing minimal capital to be invested in the dealership.
- Physical Parcelization is a lot of work and physical risk to the dealer and requires much more complex operations compared to a dealer that issues promises and can easily outsource operations.
- Storing Bullion in parcels that are individually retrievable also requires at least three times more space (and more cost) compared to simply stacking bullion up a wall on a first in first out basis.
- It does not allow for bullion leasing because the bullion is not on the dealer balance sheet.
We have developed the “Reserved” characteristic of S.T.A.R. to support invoicing and customer ownership from the beginning. Ownership is a bedrock characteristic of our storage program and a key to our success as customers are becoming more sophisticated and understand the value of having legal title to one’s bullion.
2 - the bullion you paid for actually exists?
It might seem illegal but it has been quite common by providers not to store physical bullion
while charging storage charges. Often the provider rationalle is that the bullion will be hedged financially
and if the customer needs the bullion then it will be bought in the market when requested.
There have been a number of class action lawsuits against major banks
about this in the past. Tellingly the usual defense was "It is an industry practice".
These is how we prove parcel existence:
a. Invoices and POs: S.T.A.R. Customers own their bullion in specific, sealed and uniquely identified tamper proof bullion bags referred to as "parcels". Parcel Ownership is transferred and returned via Invoices and Purchase Orders listing the specific parcel codes that were bought and sold. In Singapore falsifying an invoice is a criminal rather than civil offense so the humble invoice is a strong statement.
b. Photos of you parcels: You have access to the "Parcel Photo" report which contains a page describing each parcel you currently own and a clear photo that clearly shows the parcel's seal number, content and weight.
c. Vault Inventory Report by parcel. We publish the vault operator(s) inventory check confirming the physical presence of each parcel by serial code by vault. This is updated at least twice per week.
d. Third party specialized material auditors from the Inspectorate, a London Bullion Market Association (LBMA) approved inspection company on a quarterly basis. The latest Inspectorate report can also be downloaded online by S.T.A.R. Customers.
See the Ownership Records and Audit and Physical Inspections Sections in the S.T.A.R. Storage Agreement for more details.
3 - the bullion was not also sold to other customers (no concurrent nor multiple claims)?
It is only natural that a reserved system needs a way to insure that a parcel is not
sold to multiple customers concurrently as it would essentially downgrade the system to an unallocated storage system.
The Parcel Ownership List contains all S.T.A.R parcels and lists the respective owner of each parcel. Ownership is represented by your anonymous eight digit S.T.A.R. Owner ID so that your privacy is protected.
The complete parcel list is made available for download to all S.T.A.R. Storage customers so that each owner can crosscheck their parcel holdings. This means that any double allocation would be obvious to all S.T.A.R. @ The Safe House customers. Beside our internal checks and customer review, this list is further checked by our accountants and annually by Singapore financial auditors.
4 - the bullion is genuine and not gold plated tungsten or ceramic alloy silver?
Dealers will normally reply that the bullion comes from trusted sources.
For the most part this answer has merit but often a dealer will also buy back bullion from sources
other than mints or foundries. Having the ability to conclusively determine bullion genuinity
is a must for us. Trusting is good, being able to test is better.
Silver Bullion Pte Ltd developed a comprehensive bullion testing program back in November 2012 called DUX. DUX is an acronym that stands for Density Ultrasound
and X-ray Fluorescence testing. Each test measures and compares a different physical characteristic (mass and volume, ultrasound celerity, and surface metal composition) in such a way that counterfeit
bullion might pass an individual test but not the DUX trio of tests.
Find out more how DUX works
All Transfer-in bullion and buybacks, not coming directly from mints, foundries or primary distributors are tested in this manner and DUX test reports are associated with the Transferred bullion on a Parcel by Parcel Basis.
5 - the bullion is not encumbered nor leased out?
There is a common practice in the industry to lease out stored bullion to generate additional income.
The basic premise is that Entity A, having a large amount of bullion which was acquired using client funds is now on the company balance sheet – as clients are unsecured creditors. Entity A then takes a large chunk of the bullion and leases it to Entity B for a fee. Entity B leases the bullion, pays the fee to A and promises to return the bullion at a certain date. Entity B then proceeds to sell the bullion to other entities and assumes that they can return the bullion at some point in the future.
In such a scenario the bullion is, unbeknown to the customer, leased out and then sold to another party. Often the bullion does not even need to be physically moved as the lease normally involves only claims to the bullion and it can generate a nice side income for entity A. In such a scenario the bullion against which the client has a claim has been “encumbered’. Entity A can even claim that the bullion is still allocated as the bullion often is physically still in the vault. This practice allows Entity A to charge less, or even give free storage to clients by using the leasing income as a source of revenue.
Although it sounds illegal this practice is widespread and is legal in large part because the clients do not really own the bullion, - see Unsecured Creditor vs. Owner for details - as they merely have a claim for bullion against Entity A which in turn sees the client claims as mere liabilities on their balance sheet.
As an interesting side note, you might have heard that Germany was quoted a seven year delivery timeline to get back 300 tonnes of gold which was stored for free for the Germans courtesy of the New York Federal Reserve. Although there is no firm evidence this looks like a typical case of bullion leasing with the lease being over in 7 years – see an article on the subject that we published in February 2013.
We do not lease bullion out on principle.
Furthermore our “Reserved” storage characteristic and the legal ownership status of our customers make bullion leasing by design very difficult or straight up impossible as the bullion, due to ownership transfer, is not on our balance sheet.
6 - you understand what intermediaries (the Counterparty Chain) stand between you and your bullion?
Bullion storage is based on a chain of trust and a set of legal contracts that extend from the customer, through intermediaries, all the way to the vault where bullion is stored. Each link implies additional legal, jurisdictional and financial exposure, so the fewer the number of links the better. Because it is an industry practice by dealers not to fully disclose to customers where or with whom bullion is stored or which repatriation and Force Majeure clauses are in effect, the customer would know only about the first link of his storage counterparty chain and have little real understanding how vulnerable their bullion is in a systemic crisis.
Counterparty chains matter because your bullion is only as safe as the weakest link in your chain. Should an Intermediary, in a systemic crisis scenario, go bankrupt you might find out too late that your bullion claim only goes as far as the bankrupt intermediary – which might be a company you never heard about – and that, as an unsecured creditor, your claim to recover assets of the bankrupt intermediary is very low in the order of repayment (seniority) and second to secured creditors (e.g. banks which always secure themselves) of the bankrupt intermediary.
As The Safe House is a subsidiary of Silver Bullion by storing through S.T.A.R. @ The Safe House, you effectively reduce your counterparty chain to a single link. The absence of intermediaries means that you have legal, financial and jurisdictional certainties. To modify the saying, “The buck starts and stops with us”.
7 - you understand how sound the companies along the counterparty chain are and who are behind them?
As of March 2014 Silver Bullion has a positive balance sheet of over 5 million SGD (4 million USD) and an official recorded capitalization of 2.5 Million SGD in the company’s BizFile report (see explanation in a later paragraph). Compared to our operating expenses these are very high financial reserves, allowing the company to operate for almost 10 years without revenue if needed which is much higher than typical businesses.
The Safe House SG, which required extensive initial capital investments, was financed 90% from internal funds by Silver Bullion while 10% came directly from Gregor Gregersen, Silver Bullion’s founder. Neither Silver Bullion nor The Safe House have any debt and Silver Bullion owns 120,000 ounces of silver and 800 ounces of physical gold outright allowing for substantial in-stock inventory and thereby enabling customer ownership more efficiently.
You can easily find out unbiased and detailed information about a Singaporean company, such as registered company debtors, whether it is audited, in tax compliance, ownership details and official capitalization by downloading a Bizfile report from the Accounting and Corporate Regulatory Authority (ACRA) of Singapore.
Each report costs 5 SGD (4 USD, payable via credit card) and takes about 5 minutes to obtain. It is worthwhile to review such a file as it essentially lifts a curtain off the company, revealing hard facts and allowing you to independently verify claims that companies might make. If you are going to become a client of a storage program in Singapore it is worth spending 5 minutes and 5 dollars to review this report and counterparties on the counterparty chain.
To obtain company reports go to ACRA BizFiles.
8 - you understand what is and what is not covered by your bullion's insurance coverage?
Insurance comes in many guises. For a vault operator insurance is a major cost
so lowering an insurance through exclusions can make a big difference to the bottom line.
Depending on the type of coverage and an insurance companies inspector assessment
some type of coverage might
simply not be granted, such as infidelity, which could be seen too risky for the insurer.
As Silver Bullion Pte Ltd has moved into the vaulting business through The Safe House SG we have acquired our own insurance policy instead of relying on direct insurance from an outsourced Vault Provider.
Obtaining an extremely strong all-risk vault insurance at good rate was probably the most important milestone for Silver Bullion and The Safe House as our insurance essentially removes all physical storage risk and has a better coverage than most established vaults.
The the insurance protects your bullion not only from Theft and Fire but also includes:
- Full infidelity coverage. In essence the insurance will fully cover the possibility of inside jobs (TSH Staff Stealing Bullion) for the entire policy amount of 100 million USD per loss
- Full mysterious disappearance coverage. We always felt uneasy storing bullion at a vault which would not be liable for mysterious disappearance of bullion. So it was an insurance priority for TSH to insure this is included. Mysterious disappearance essentially covers the possibility of operational errors by TSH for the entire policy amount of 100 million USD per loss.
Such insurance strong insurance, issued by XL Group - a Lloyd’s underwriter - was made possible because the underwriters who inspected the storage facility, processes and people behind it, decided to effectively trust The Safe House SG unconditionally for 100 million USD.
As of late March 2014 this insurance amount is twice our currently stored bullion and will be raised further as needed.
S.T.A.R. @ The Safe House customers can download the signed Insurance Certificate and policy number from the storage interface.
9 - you understand what jurisdictions the companies in the Counterparty Chain are exposed to?
A Force Majeure clause relieves a party from an obligation under the contract if a certain event occurs so if you are seeking to protect yourself from systemic risks then you would want to make sure this clause does not undermine the very reason to store bullion in a separate jurisdiction.
A major reason The Safe House was created was that there is little bullion storage capacity in Singapore that is not run by a subsidiary of an overseas company, thereby implying direct or indirect exposure to European or US governmental regulations which will likely be bearing the brunt of upcoming systemic crisis. Such exposure creates legal ambiguity as to what would happen if a Western nationalization were to re-occur and is made evident in the Force Majeure clause of storage contracts, which typically indemnify the storage provider from “any governmental action, by any government”.
We believe that if you go through the trouble of storing bullion in Singapore then you should not have to sign such an “any by any” clause as it negates the very reason to store bullion in Singapore in the first place. Furthermore, unless you are dealing with a storage provider directly, you would not know what Force Majeure clauses your dealers accepted in their respective contracts with the next middlemen or storage facility. Such storage counterparty chains cause further legal vagueness and uncertainty.
Through The Safe House SG Pte Ltd, being a subsidiary of Silver Bullion Pte Ltd, we have full contractual transparency along the entire storage chain with no material Western regulatory exposure for stored bullion. Although a Western nationalization event or shipping restrictions would affect our ability to obtain new bullion and might stop us from accepting US dollars as payment, your existing bullion would not be affected by a Western nationalization occurrence.
10 - your chosen jurisdiction is indeed a safe choice?
Why do you claim that Singapore a such a good choice for bullion storage?
Although Singapore has no natural resources, it managed, over the last 50 years, to become one of the richest countries in the world through an excellent educational system, very efficient governance, hard work and pragmatism, extremely low corruption and simple but clear laws that foster competition and guarantee private property. Although there are no capital gains taxes and low income taxes the government had budget surpluses 23 times over the last 25 years and closed 2013 with a 3.9 billion SGD (3.1 billion USD) surplus. English is the primary language along with Chinese (Mandarin), Malay and Tamil (Indian) dialect and the country boasts extremely low crime rates. In other words, Singapore is rich, safe and stable which we deem to be the criteria for choosing the best jurisdiction for bullion storage.
Beside being a leading financial center Singapore has one of the busiest airports in the world, the busiest cargo port in the world and huge refineries on an offshore island called Jurong island. Although Singapore is covered by malls and entertainment options, plenty of scarce land were reserved to natural parks and trees. Real estate prices are sky high as Singapore has become a favorite destination for able workers and entrepreneurs. A host of other, constantly evolving, industries and businesses call Singapore home and it is a top location for global companies to set up its Asian headquarters.
The Singapore Government is, in many respects, run like a business as governmental ministries, for example, have their budget reduced every year, rather than increased, and have to bid for additional funds which keep pressures on governmental officials to raise efficiency and services. Politicians are very well paid to attract smart individuals and minimize the temptation of favoritism or flat-out corruption. Most policies, a legacy of Lee Kuan Yew, are truly designed for the long-term benefit of the country rather than political maneuvering to win votes during election. Singaporeans are afraid to be outcompeted and will try just a bit harder which explains why the country has done so well.
Much of this success has come about because Singapore is one of the most trusted jurisdictions in the world and is well known as a country were laws are upheld in spite of external pressures. Lee Kuan Yew, the very long serving prime minister who is rightly seen as the architect of modern Singapore summarized Singapore’s success down to a single word: confidence.
This situation is excellent for bullion storage because, if Singapore (for example) were to nationalize gold due to US pressure (for example) the consequences would be an immense loss of confidence and would have a devastating effect on the Singapore economy. So although nothing is ever absolutely certain, Singapore has no incentive (as they are very wealthy already) and it has a lot to lose by supporting a hypothetical US gold nationalization.
An interesting case illustrating Singapore’s willingness to stand up to foreign pressure was the Michael Fay graffiti case where, then President Bill Clinton and a group of US senators tried in vain to prevent Michael Fay from being caned. Read about it here.
These factors make Singapore a great jurisdiction for Gold and Silver storage. To better understand how and why Singapore works we highly recommend reading “From Third World to First” written by Lee Kuan Yew himself.
Singapore is so small, can it not be invaded overnight?
Singapore has been very careful to neither ally nor distance itself with any major power as they try to avoid policies that could cause conflict down the line. In line with this policy, Singapore has managed to build a number of mutual defense treaties with surrounding countries designed to reinforce stability in the region.
Surprisingly, Singapore also carries an enormous stick give its small size. Regionally this city nation is a military heavyweight, given the two year compulsory military service for Singaporeans that allow the armed forces, police and the civil defence force to deploy over 950,000 personnel with a large portion deployable at short notice given the yearly week-long readiness drills. The defense budget is around 12.1 Billion SGD (almost 10 billion USD) making Singapore a medium sized spender internationally and the country with the highest military expenditure in the entire ASEAN region.
Singapore even has a defense industry which locally manufactures and exports the SAR 21 rifles and various artillery pieces which are used by other militaries and Special Forces. Among others Singapore has both training and military bases in Taiwan, Thailand, Australia, India and the US (Idaho). In other words, Singapore is very well defended regionally.
You can read more about it here.
The S.T.A.R. Acronym Explained
S.T.A.R. @ The Safe House minimizes financial and jurisdictional risks and is a lifeboat
in the event of a systemic financial crisis, rampant financial bankruptcies, hyperinflation or
precious metals nationalization by Western countries.
The four defining characteristics of S.T.A.R. @ The Safe House:
Exclusive Singapore Jurisdiction across the entire storage chain -
If you seek to diversify your assets internationally there are few countries which are a safer choice than Singapore.
The S.T.A.R. @ The Safe House program and Silver Bullion Pte Ltd are exclusively based in
Singapore with no jurisdictional ties to the US or any country in Europe across the entire storage chain.
For international customers this can be an important diversification aspect,
especially in light of precious metal nationalizations that occurred in the US during the Great Depression.
See Executive Order 6102.
Ownership without Financial Markets Counterparty Risk – As a S.T.A.R Storage customer you are the legal owner of the bullion as evidenced by a commercial invoice.
Falsifying invoices in Singapore is a criminal offense, giving these documents a strong legal status. Ownership is a much stronger position compared to the unsecured
creditor status that most financial (paper) precious metal positions entail.
All-Risk Insurance –
Bullion stored at The Safe House is covered by an all-risk insurance that includes
mysterious disappearance and infidelity, thereby insuring operational errors
or inside jobs and effectively removing all physical storage risk to the customer.
Silver Bullion Pte Ltd - A Strong One-Stop Counterparty
Silver Bullion is unique in offering a one-stop solution for
trading, testing and storing of bullion
with no middlemen. Furthermore, Silver Bullion fully
owns more than 190,000 ouces of silver and 800
ounces of gold and platinum and has no debt, making it an extremely strong counterparty.
No Import Duty or Sales Tax on IPM Bullion
- S.T.A.R. Storage is exempted from duties and the Singapore Goods and Services Tax (GST)
because we store only IPM Tax Exempt Bullion
which can be freely taken delivery of, imported or exported. Please note that only bullion
defined as IPM can be transferred into S.T.A.R. @ The Safe House though our Transfer-In Program.
No Capital Gains Tax in Singapore
- Singapore has no capital gains tax for private individuals.
Thus, under Singapore law, no local taxes are due on profits derived
from selling your bullion.
The above refers to Singapore jurisdiction only;
if you are foreign resident or citizen
you might be required to voluntarily report
and pay capital gains taxes to the tax authority that has jurisdiction over you.
No International Reporting Requirements
- S.T.A.R. Storage involves physical products (bullion) storage which is not
classified as a financial product by Singapore.
There is no legal obligation on Silver Bullion to report to any foreign government,
including any foreign tax authority, regulator and/or any foreign public authority
to provide information on any customers and/or any transactions performed under
the S.T.A.R. Storage Agreement.
See 12.4 Transaction Encryption & Data Security
Always Fully Allocated - The total amount of bullion in storage always matches
or exceeds as the total amount of bullion owned by S.T.A.R. customers.
This is because the "Reserved Storage" system makes unallocated positions impossible
and because Silver Bullion, which fully owns over six metric tonnes of silver and 800 ounces of gold and platinum,
is also storing bullion at The Safe House.
See the Allocated (Fully) Storage Section in the S.T.A.R.
Storage Agreement for more details.
Clear Ownership Title - Bullion held in S.T.A.R. Storage by customers will not be subject to any kind of
lending, collateral or derivative transaction of any type and will remain your property in the
safekeeping of the Vault Operator until sold or withdrawn according to your instructions
received via Silver Bullion.
Transparent Inventory & Ordering
S.T.A.R. Storage lists how much bullion is available in-stock for immediate purchase at the vault or
whether a purchase needs to be pre-ordered from suppliers.
As a permanently fully allocated storage program S.T.A.R. differentiates
between these orders since you can only receive legal title for bullion that is physically present in the vault.
Uniquely Identified Bullion Parcels with Photo ensure your parcel exists.
S.T.A.R. Customers own their bullion in specific, sealed and uniquely identified tamper proof bullion bags referred
to as "parcels". As a S.T.A.R. Storage owner you have access to the "Parcel Photo" report which contains pages describing
each parcel you currently own and a photo that clearly shows the parcel's seal number, content and weight.
Direct Vault Inventory Statements and Third Party Inspections ensure Bullion is Present.
We publish the original vault operator(s) inventory check confirming the physical presence of each parcel by serial number.
This is done at least twice a week and the checks confirm that all the bullion is indeed in the vault. Furthermore, the inventory
parcels are checked quarterly by specialized material auditors from "Bureau Veritas / Inspectorate",
a London Bullion Market Association (LBMA) approved inspection company.
All documents as well as the insurance certificate can be downloaded online by S.T.A.R. Storage Customers.
Audit on Demand Option.
It is possible to organize an audit of your bullion through the "Inspectorate" or another auditor of your choice
which will issue you a findings report. Please note that such audits are relatively costly at around 2,000 USD and, given that quarterly audit reports are
included in our storage service, these might only make sense under special circumstances.
The Parcel Ownership Report Prevents Double Assignment of Parcels
The Parcel Ownership List contains all S.T.A.R. parcels and lists the anonymous eight digit S.T.A.R. Owner ID
owner next to each parcel. This complete list is made available for download to all S.T.A.R.
Storage customers so that each owner can crosscheck their parcel holdings. This means that any double allocation
would be obvious to all S.T.A.R. @ The Safe House customers while preserving owner anonymity.
Key Documents you have access to:
All charges are in Singapore Dollars—the figures below are rounded to the nearest cent;
however, the actual charge is calculated up to four decimal places.
It is possible to pay the US dollars equivalent amount which is set
at the time of order.
For Parcel Buy / Sell rates please review the
Cumulative Discount Tier Price Chart for each bullion item.
Storage customers always enjoy the client buyback rate.
Fixed (absolute Singapore dollar amount, not percentage) storage rates of:
S$9.86 SGD ($7.14 USD) per gold or platinum ounce per year
S$0.28 SGD ($0.20 USD) per silver ounce per year
Storage charges start on the date bullion ownership is transferred in your name and the invoice is closed (Invoice Date). You will not be charged while your order is being processed or if it is a pre-order.
Upon sale or delivery of parcels any unused or overdue storage months will be refunded or deducted on a daily pro-rated basis as part of the Purchase Order or Delivery Note.
It is possible to transfer your existing bullion into S.T.A.R.+ which includes repackaging into parcels, validation through DUX testing and the ability to sell the bullion to us online.
Transfer-in is charged on a per-oz basis and discounted based on your discount tier. See S.T.A.R.+ Transfer-In for details.
Optional pick-up in Singapore at S$25.00 SGD per parcel ($18.11 USD) of Declared Value from The Safe House.
Additional S$299.00 SGD ($216.56 USD) if armed delivery to a Singapore address is required.
Bulk delivery charges outside of Singapore vary depending on destination and volume.
To purchase bullion under S.T.A.R. @ The Safe House go to your account profile or
create an new account and submit a S.T.A.R. Storage Application
to enable your account. Once your account is verified and S.T.A.R Storage enabled, you will see a checkmark
next to your username and will be able to buy, sell or take delivery of your parcels online.