Homepage / Bullion Security : Vault Storage of Assets
Updated on 03/02/2024
When considering vault storage, individuals typically choose three general methods:
This page discusses all three, their pros and cons, and the alternatives of vault storage that a person can utilize to store valuable assets or precious metals bullion.
Discernment, security, and convenience are what everyone wants in the storage of their assets.
The following are crucial factors to review before you decide which method of vault storage is most suitable for you and your assets.
Anyone can be a victim of a natural disaster or burglary.
Most natural disasters, besides hurricanes, occur with little or no warning and can change in severity without notice.
If your area has experienced natural disasters like fire, flood, tornado, or earthquake, be cautious before storing assets or bullion in your home, and consider storing them off-premises in another type of vault storage.
Crime is another variable to contemplate while deciding how you want to store your assets or precious metals bullion.
Law enforcement statistics indicate that individuals residing in large metropolitan areas or renting their residences are more susceptible to burglary.
Furthermore, if you have roommates or frequent guests or parties at your home, a sad but true statistic about burglary is that the majority of home and office burglaries are carried out by someone the owner knows or has met.
The sections that follow will further help you refine your vault storage options.
After you've fully scrutinized which type of vault storage works best for you, you will acquire the knowledge that supports discernment, security, and convenience.
When you want to keep valuable assets at home out of the reach of curious hands or prying eyes, the first thing that springs to mind is purchasing a home safe.
The next determination to make is what type of home safe you'll need for the level of protection required to safeguard your assets.
The size of the home safe depends on what you are putting in it and if you expect to add to what is in it or not.
In addition to purchasing a safe for your house, an individual should think about other security expenses, such as supplemental insurance for the assets kept inside the safe, a home security alarm, motion-detecting lights and alarms, door and security cameras, etc.
➤ Please keep in mind that the best advice any Law Enforcement official can provide you regarding storing valuables assets at home is "don't tell anyone about it."
➤ In the past year, the FBI gained access to a private citizen's gun-safe because the manufacturer willfully gave them the combination to it; read the full story in the article below.Liberty Safe Let FBI Seize Customer’s Gun Safe Contents Without A Court Order - The Federalist
To understand how to find the best home safe for you, see this site's Home Safe Buying Guide; it gives you all the information you need before you purchase a safe and a list of reputable retailers to find one.
Safe deposit boxes are made of metal and sit inside a bank's vault; bank vaults are made of reinforced steel on the inside and reinforced concrete on the outside, and they can resist an F5 tornado.
Safe deposit boxes have a two-key locking system; the boxes are rented by size, the most common being 3"x5"x22." Prices are reasonable, but they are always changing.
When an individual has a bank deposit box and wants to access it, they will go inside the bank vault with a bank employee, and both will have a key to unlock the box; the employee's key is called a "guard key."
Once both keys have unlocked the safe deposit box, the individual is left alone to deposit or withdraw items.
In the United States,
If you decide to rent a safe deposit box, below are a few articles to assist with what you should and should not store in a safe deposit box.Things You’ll Regret Keeping in a Safe Deposit Box - Kiplinger
To rent a safe deposit box, consult your local bank for sizes and charges, as most banks require an active account to rent the box.
A few key reminders:
Lastly, because safe deposit box thefts aren't uncommon, there is an Insurance Company that specializes in protecting you if your safe deposit box is compromised; it's called SDBIC (Safe Deposit Box Insurance Company).
Bailment is a common-law legal relationship where the owner transfers physical possession of personal property for a period of time but retains ownership.
In a Bailment Agreement, the Vault Storage Company is the custodian, or "bailee," and the person who buys the vault is the "bailor."
The assets in a vault are not part of the company's (bailor) balance sheet because it is not their property; it is in the renter's (bailee) name, and the company is storing it for them.
Even in the case of the bankruptcy of the "Bailee's," creditors cannot claim your assets as theirs because of the Bailment Agreement.
When you open an account with any Vault Storage Company, you want to make sure your assets are segregated in an allocated account independent from the assets of the business you are dealing with (off their balance sheet) because the assets are yours, not theirs.
Otherwise, they can walk away with your assets, and you would have no legal recourse.
There are several reasons Private Vault / Safety Deposit box storage services have begun to pop up in the United States and globally.
All private vault storage services should do business under a bailment agreement; if you find one that doesn't, walk away because it may cost you your possessions.
Case in point:
In March 2021, a private vault storage company based in California named "U.S. Private Vaults" was raided by the FBI, which seized $86 million of the vault company's clients' assets.
However, two U.S. Private Vaults clients sued the FBI for their unlawful seizure and prevailed in the 9th Circuit Court of Appeals.
The articles below are about this case.9th Circuit: FBI Illegally Raided Hundreds of Safe Deposit Boxes - Money Metals Exchange
Note: Phrases associated with Bailment Custodian Agreements: allocated accounts, segregated account, and assets off balance sheet.
Note: Not all the companies below state that they have customer-allocated or segregated accounts that are off their balance sheets; it is advised to read your contract thoroughly because you want to get it in writing before you store any assets with them.
🛡️ AVM - Automated Vault Machine (Buford, Georgia, U.S.)
🛡️ Blue Vault (Orange County and San Diego, California, U.S.)
Colorado Vault & Safe Deposit Box Co. (Colorado, U.S.)
🛡️ CommonWealth Vault & Safe Deposit Co. (Loudoun Co., Virginia, U.S.)
🛡️ Florida Intervault (Ft. Lauderdale, Florida, U.S.)
🛡️ Guardian Vaults (Melbourne & Sydney, Australia)
🛡️ IBV International Vaults (Mutliple Locations, Not available in the U.S.)
🛡️ Idaho Armored Vaults (Idaho, U.S.)
🛡️ International Depository Services Group (Delaware, Texas, U.S.)
🛡️ Mountain Vault (Phoenix, Arizona, U.S.)
🛡️ The Security Center - (New Orleans, Louisiana, U.S.)
🛡️ The Vaults Group (United Kingdom - multiple locations)
🛡️ Baltimore Vaults (The Vaults Grp, Maryland, U.S. - opening mid-2024)
🛡️ Manhattan Vaults (The Vaults Grp, New York, U.S. - opening mid-2024)
🛡️ Miami Vaults (The Vaults Grp, Florida, U.S. - opening mid-2024)
🛡️ Ultra Vault by MALCA-AMIT (Multiple Locations in the United States and Around the World)
A few key reminders:
It is business as usual for many of these precious metals bullion dealers to buy, sell, and deliver precious metals to you.
As part of their business, they regularly keep a portion of the bullion in their inventory in a depository. As a service to you, they are expanding the depository services they provide to you in allocated accounts in separate vaults but in the same depository.
Prior to making any financial decisions, an investor should trust where they are putting their money.
Although rare, some individuals have taken advantage of people by claiming to do what these services do.
One of the worst scams happened in 2021 when a precious metals dealer and depository conspired to rob investors of over one hundred million dollars. See the full story here: Argent Asset Group, First State Depository to Pay $146 Million for Precious Metals Fraud.
This investment guide provides you with links to reputable businesses in the industry (below), but the choice is yours on who you do business with; the best advice we can give is to trust the service and investigate them before you do anything with them.
Look at the business's customer reviews from an independent source, which we have provided below.
In addition, we encourage you to visit the Commodity Futures Trading Commission website here and search (top right) for any business or individual you might be thinking about buying precious metals.
These services offer international storage for those who want to preserve their wealth through precious metal bullion.
International vault storage locations include the United States, Canada, London, the UK, Switzerland, Singapore, and the Cayman Islands.
The following are the Advantages of International Storage:
Vault Storage Brokerages work much in the same way a stock brokerage does.
Stock brokerages offer you stocks to buy; when you buy them, the brokerage stores those stocks in your personal segregated account, and when you want to trade or sell those stocks, you use their system to do what you want, with minimal overhead costs.
The one difference is that with all stock brokerages, getting a physical stock certificate doesn't happen anymore because stock brokerages have turned to digital record-keeping.
Whereas getting the physical bullion from a vault storage broker is commonplace and, in many cases, expected.
Vault Storage Brokerages trade digital precious metals; you make trades like the professionals on the COMEX into wholesale LBMA Gold and Silver Good Delivery Bars.
Learn more about these services from our guide on Vault Storage Brokerages.
Regardless of how much you own in precious metals in comparison to your total investment or savings portfolio, the question that many ask is:
How should I diversify my precious metals investments?
Ultimately, you know what works for you, what you can afford, and what form of precious metals works best for you.
There are several choices:
The chart below is a sample portfolio of how an individual may diversify 20% of their money in precious metals.
Vault Storage of Bullion
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