Gold: What every Accountant, Financial Planner, and Business Owner needs to know.
If you think your holdings in gold are as “good as gold” then think again.
Buried in the Banking Act 1959 (Cwth) are an innocuous set of provisions which:
• Gives power to the Federal Government to confiscate gold; and
• forbids the sale of gold except to the Reserve Bank.
You cannot sell or buy gold except with the permission of the Reserve Bank and if you do it is a criminal offence. The provisions do no apply to wrought gold which means gold and gold alloys which on view have apparently been worked or manufactured for professional or trade purposes.
As at the date of this article the operation of the above prohibitions lay dormant.
However if the Governor-General thinks it is necessary for “for the protection of the currency or of the public credit of the Commonwealth”, the prohibitions will come into force. There is no need for further parliamentary debate or warning for it to occur.
There are 2 troubling scenarios on the horizon that could trigger the Governor General’s action:
• a falling (valueless) Australian Dollar;
• a deficit that cannot be repaired (it has been in deficit for 7 years and is currently circa $40 billion).
A further scenario that may trigger action is the behaviour of governments in other countries who appear to be stockpiling gold to sure up their own economies such as Germany, China, Russia and India.
The forced confiscation of gold is a real threat. It has happened in other countries and the system is set up for it to occur in Australia.
Why else would it be legislated for in the Banking Act? We will let you draw your own conclusions.
For more information please contact: Evan Sarinas of Sarinas Legal. This release is not intended as legal or financial advice and all liability is disclaimed for reliance on it