Is my gold secure in a bank’s safety deposit box?

People who don’t want to store their precious metals at home will often consider hiring out a safety deposit box at a bank.

Safety deposit box services, historically, have been heavily dominated by the banks – but as the need for this type of service has escalated and waiting lists at banks only grow longer, privately owned facilities are now becoming more and more prevalent.

But how safe is your gold and other valuables in this kind of environment? Before taking the plunge and placing all your assets in a financial institution’s safety deposit boxes, consider the possible drawbacks of such services.

For example, while many people assume their assets are protected, there have been historical instances where governments have seized citizen property stored in banks.

In 2008, ABC reported that some US states aggressively took control of ‘unclaimed property’ in banks’ safety deposit boxes. Valuables were sold off at a fraction of the price, while important documents were destroyed.

However, in some cases, banks made no contact with the deposit box owners before drilling, removing and selling the contents to the government.

California was identified as being particularly aggressive in seizing assets. The state altered legislation to reduce the number of years it took before a safety deposit box could be considered unclaimed.

Previously, there needed to be no contact between the customer and the bank for 15 years. This was dropped to seven years, then five, then three.

This is not just a problem in the US. Earlier this month, it was revealed the Australian federal government seized $360 million from household bank accounts that were dormant for just three years.

Figures from the Australian Security and Investments Commission showed the money was collected from 80,000 accounts in the year to May under new Labor rules.

“We have grandparents who put money aside for their grandkids’ future and farmers who have set aside money for a rainy day, but it was transferred to the government,” said Australian Bankers’ Association chief executive Steven Munchenberg.

Talking to Fairfax Media, he explained that it was a rushed piece of legislation primarily to boost the budget. While 90 per cent of the accounts contained less than $5,000, some were worth millions of dollars.

Disclaimers: Guardian Vaults Holdings Pty Ltd, Registered Office, Scottish House, 100 William Street, Melbourne, Victoria, 3000. ACN 138618176 (“Guardian Vaults”) All rights reserved. Any reproduction, copying, or redistribution, in whole or in part, is prohibited without written permission from the publisher and/or the author. Information contained herein is believed to be reliable, but its accuracy cannot be guaranteed. It is not designed to meet your personal situation. Guardian Vaults, its officers, agents, representatives and employees do not hold an Australian Financial Services License (AFSL), are not an authorised representative of an AFSL and otherwise are not qualified to provide you with advice of any kind in relation to financial products. If you require advice about a financial product, you should contact a properly licensed or authorised financial advisor. The information is indicative and general in nature only and is prepared for information purposes only and does not purport to contain all matters relevant to any particular investment. Subject to any terms implied by law and which cannot be excluded, Guardian Vaults, shall not be liable for any errors, omissions, defects or misrepresentations (including by reasons of negligence, negligent misstatement or otherwise) or for any loss or damage (direct or indirect) suffered by persons who use or rely on such information. The opinions expressed herein are those of the publisher and/or the author and may not be representative of the opinions of Guardian Vaults, its officers, agents, representatives and employees. Such information does not take into account the particular circumstances, investment objectives and needs for investment of any person, or purport to be comprehensive or constitute investment or financial product advice and should not be relied upon as such. Past performance is not indicative of future results. Due to various factors, including changing market conditions and/or laws the content may no longer be reflective of current opinions or positions. You should seek professional advice before you decide to invest or consider any action based on the information provided. If you do not agree with any of the above disclaimers, you should immediately cease viewing or making use of any of the information provided.

Enquire now

Please provide your details and we will contact you to discuss your needs.

Enquire Now

Please provide your details to reserve space at Guardian Vaults.

Enquire Now

Please provide your details to reserve space at Guardian Vaults.

Enquire Now

Please provide your details to reserve space at Guardian Vaults.

Enquire Now

Please provide your details to reserve space at Guardian Vaults.

Enquire Now

Please provide your details to reserve space at Guardian Vaults.