Perth Mint Certificate program may actually be fraudulent

S

SilverQueen

New Member
Any PerthMint Folks wants to shed some real lights on PMCP or PerthMint Depository program? Anyone seen any 3rd party audit report on physical metals in PerthMint?

http://blog.milesfranklin.com/?p=4672

blog.milesfranklin.com / By Andrew Hoffman / October 19th, 2012

Read the Thursday Afternoon Wrap-Up for 10/18/2012 and the Friday Morning Commentary for 10/19/2012

There are just five MAJOR bullion mints in the U.S., Canada, South Africa, Austria, and Australia. I have never been certain why they are deemed more "trustworthy" than private mints given governments' sorrowful history with TRUTH; however, not a single counterfeit coin has EVER been sourced from these mints.

That said, long-time readers know my emphasis between the TRUTH of PHYSICAL PMs, and the LIES of PAPER markets. With essentially ZERO exceptions, if you purchase a "promise" to deliver gold and silver, there is a good chance you'll NEVER see it. Thus, the quandary of Perth Mint Certificates; i.e., 'certificates of ownership' of gold stored in Perth Mint vaults.

In many ways, the Perth Mint program mirrors Miles Franklin's storage program in Montreal, Canada. In other words, you are given a certificate stating you are the owner of Precious Metals stored in their vault. However, given Perth's long distance from the Western world and lack of a personal connection between your metal and the Perth Mint (Miles Franklin officers personally audit the Montreal vault each quarter) it is difficult to ascertain if Perth mint held metal exists.

[More]...http://blog.milesfranklin.com/?p=4672
 
Huh, sounds like some yankee is talking down to us.....

I'm pretty sure i've seen one of those audit reports
 
Like some parts of the media.

An ignorant blog with sensationalist topics gets the most views.
Blog win. Information fail.

Rule of thumb: Author needs to resort to CAPITALS sporadically throughout their article.... probably lacks credibility.
 
Anyone got any 3rd party audited report of Perth Mint's program? May be Bron can respond whether the PMDP have physical metals 100% stored in Perth Mint vaults in perth or just
paper contracts in LBMA? or physical metals stored with Bullion banks of LBMA like JPM, Brinks, HSBC, Scotia?

Bron? Any perthmint representative here?
 
The FRAUD article he links to is from 2008. And the blog title strangely bears the same name as the storage program in Canada that he is flogging - er, recommending.

And, if he doesn't have enough evidence to dish out dirt on the PM Prpgram then why use Perth Mint fraudulent as one of the subtitles?

All seems a bit sensationalist.

And, where is Montreal anyway, Canada is a long way away, How do we really know it's there.
 
SilverQueen said:
Thus, the quandary of Perth Mint Certificates; i.e., 'certificates of ownership' of gold stored in Perth Mint vaults.
Click to expand...

Not exactly true, but sensational enough to sell a few newsletters.
 
Bold claims for a company to be making - the rest of the article not quoted is an offer to sell you THEIR storage services by taking delivery of Perth Mint gold, having it shipped to Canada, and stored under their control.

Not sure I would entrust my storage of metals to a company that so blatantly spruiks debunked material in their advertorials.
 
Personally I regard the Perth Mint as "safe as you can get". I trust it far more than any Australian bank. I think that it does Australia credit.
 
Totally agree Jonesy, I think The Perth Mint does australia and particularly Western Australia a very great service.
 
Look the bottom line is that whilst I am personally a big fan of the home grown product and a large portion of my stack comprises of Perth Mint product, I will always feel safer in holding and storing the physical in hand myself.

Whilst I wouldn't want to wager in on the fraud allegation and we have a friendly relationship here with the Perth Mint, let's not forget the fundamentals on what we do and why we do it either.

Regardless of who makes the claim and what verification, assurances and proofs they can provide - unless you actually have the metal in hand you are exposed to 3rd party counter risk.

Naturally, the Perth Mint would be considered one of the 'safest' 3rd party holders of your metal that many of us would probably know (and for a number of us, that's going to be good enough), but at the end of the day you have to make that choice as to where you lay your chips.

Unless I had a position in 7+ figures where actually holding physical could be considered dangerous or cumbersome, there's no substitute for taking 100% ownership of physical and whilst we can debate the message of the article concerning fraud on the surface, I wouldn't let that distract me from the underlying message here that we all know and endorse :

If you can't hold it, you don't own it.
 
Here's some additional information that may assist researchers:

Western Australian Consolidated Acts

GOLD CORPORATION ACT 1987 - SECT 22
22 . Guarantee by Treasurer

http://www.austlii.edu.au/au/legis/wa/consol_act/gca1987188/s22.html


Government Guarantee
http://www.perthmint.com.au/investment_invest_in_gold_government_guarantee.aspx


Precious Metals Storage
http://www.perthmint.com.au/investment_invest_in_gold_storage_options.aspx


Perth Mint FAQ (Allocated vs un-allocated)

http://www.perthmint.com.au/investment_invest_in_gold_faq.aspx
 
All these guarantees are in paper. They will guarantee your gold/silver in $. This comment that in the event of a calamity and having to enact the government guarantee they will use the government cash to buy your metals back on the open market?

If you believe any of this,if so, I am selling pixie dust at a very reasonable price of $2M / gram any takers?

If there was a calamity that took down the PM do you think they would find gold and silver at any price. Secondly and more importantly if they store your gold what could happen that would require them to go and buy your gold back. I am of the belief that gold at this time does not evaporate or disintegrate so why would they need to buy your gold/silver back for you. Answer - they have not got it simple ??

If I am wrong I do apologize but until we see evidence (an Audit) this is no different to any other paper asset guaranteed by a government. Do you think Mr Swan will be paying you out $250k if the banks crash ? Yes maybe in numerical terms but if the banks crash that money will be the cost of a cup of coffee.
 
2. Unlike most custodial services, Perth Mint Certificate clients holding Allocated are able to request to see their physical bars or coins at any time and do not need to rely on third party verifications, so they do have a personal connection to their metal.

3. Perth Mint Allocated and Unallocated clients can take comfort from the fact that we operate under multiple levels of audit: a) we perform full quarterly inventory stocktakes; b) our internal and external auditors are major accounting firms; and most importantly c) those auditors are not appointed by us but by the Auditor General of the State of Western Australia, which means we have no influence over them and they report to, and their audits are reviewed by, the Auditor General. Also note that the Auditor General is not controlled or report to the Government of the day, but to the State Parliament (ie bot the Government and the opposition parties), ensuring its independence


http://blog.milesfranklin.com/perth-mint-revisited-you-asked-for-it-you-got-it
 
The Perth Mint 2012 Auditors Report

Auditor General

Page 1 of 3

7th Floor Albert Facey House 469 Wellington Street Perth MAIL TO: Perth BC PO Box 8489 Perth WA 6849 TEL: 08 6557
7500 FAX: 08 6557 7600
XOFAGL001

INDEPENDENT AUDITOR'S REPORT
To the Parliament of Western Australia

Auditor's Responsibility

As required by the Auditor General Act 2006, my responsibility is to express an opinion on the
financial statements based on my audit. The audit was conducted in accordance with
Australian Auditing Standards. Those Standards require compliance with relevant ethical
requirements relating to audit engagements and that the audit be planned and performed to
obtain reasonable assurance about whether the financial statements are free from material


Opinion

In my opinion, the financial statements are based on proper accounts and present fairly, in all
material respects, the financial position of the Gold Corporation and the consolidated entity at
30 June 2012 and their financial performance and cash flows for the year then ended. They are
in accordance with Australian Accounting Standards and the Treasurer's Instructions.
misstatement.

Read the full report here:

http://www.perthmint.com.au//documents/gold_904_annual_report_final_online.pdf
 
Thanks Holdfast

I have been reading the Full Report and This is what is said about the deposits

The number of clients, from 105 countries, increased
from 20,000 to 23,000 and the value of metal held
increased slightly to $3.5 billion by the end of the
financial year. Of this, $565 million was held in the form
of allocated metal, with the balance held as either
unallocated or pool allocated product.

To me that is not an audit ? This is a statement for public consumption.

IMPORTANT Later in the report :(page 40)

Assets
Precious metal inventories 3,047,876 3,047,876 3,069,560 3,069,560
3,047,876 3,047,876 3,069,560 3,069,560
Liabilities
Precious metal borrowings interest bearing (137,485) (137,485) (45,588) (45,588)
Precious metal borrowings non- interest bearing (2,903,861) (2,903,861) (3,002,353) (3,002,353)
(3,041,346) (3,041,346) (3,047,941) (3,047,941)

NOTE VERY IMPORTANT !!!!!

The $2,903,861 (2011: $3,002,353) of precious metal deposited by Perth Mint Depository clients (note 25) was used in
operations by the consolidated entity as working inventory.

So to my mind they borrow PM against the deposits ? I presume this is the unsecured.
I am not an accountant but this sure looks like the gold that is unallocated is used by the PM and noted as a liability ?
That is no problem unless everyone wants their gold ?

This is a safe as your cash in the bank. Am I wrong ?
 
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