Typically the Kitco Raid in addition to Why It Is usually Not Safe to Store Gold canada
I know that my articles need many readers in North America – both from the USA and coming from Canada. Canada offers a very reputable image internationally (the Canadian government seldom stirs up trouble outside its borders), and the Canadian banking system will be admittedly much more stable than the PEOPLE. Even the currency has been doing well, backed in part by Canada’s huge wealth of gold and other natural resources.
You might think, after that, that Canada would certainly be the great asset protection safe place. In fact, many of us frequently receive phone calls from US Us citizens asking how to be able to open bank accounts within Canada, or convinced that the Canadian dollars is a safe haven against failure of the US dollar. But folks who think Canada is a good investment alternative to be able to US instability and even systemic insecurity are usually seriously mistaken. Typically the raid on Kitco a week ago amply demonstrated this, if this wasn’t already evident.
Considering the amount of money Nova scotia makes from valuable metals and exploration companies, you might think they might respect the platinum business. Indeed, really no coincidence of which one of the world’s largest gold trading and researching firms is Canadian – and that was this firm, Kitco, that has been raided by authorities inside Quebec last week. Nearly every precious metals site out generally there links to the renowned Kitco charts.
The friend of mine who has a new gold investing blog website recently warned concerning how the US Government was looking to “regulate” yellow metal trading companies. Manage, he says, “is a code-word regarding, take-over, destroy or even monopolize. “
He previously been warning against this trend in the particular US, but this individual probably wasn’t shocked that Canada took the lead. Greater than 175 Revenu Quebec agents conducted raids related to Kitco on homes, office buildings, accountancy firms in addition to bankruptcy trustees inside the Montreal place. In other words, Kitco was raided big-time by typically the equivalent in the IRS, and a court-appointed receiver is today manipulating the company.
Kitco is actually not formally recharged with anything. While my buddy Jeff observed, “Kitco has been a highly respected and reputable gold and silver coins dealer for years canada and this is highly, extremely unlikely that that they have done something improper. “
The particular allegations, as I know them, apparently middle on supposed florida sales tax evasion. Because discarded gold is controlled by tax but bullion and coins isn’t, allegedly Kitco was buying discard gold, paying the sales tax to the sellers (local gem firms or small gold dealers) well then legitimately reclaiming typically the sales tax compensated. Since Kitco seemed to be selling bullion, they were not obliged to charge sales duty. Therefore they would likely have been getting large tax rebates on a regular basis – some thing governments obviously detest!
All this is definitely quite legal in addition to normal, but really possible that the sellers of the particular scrap gold basically disappeared, as opposed to giving over the florida sales tax to the government since they were supposed to be able to. This means that on the one hand the government are not receiving the tax, however they were paying out it out to Kitco. In Europe this particular is called “missing trader fraud” or “carousel fraud” in addition to also reached outbreak levels a partners of years back on easily tradeable high value products like microchips, until governments had to introduce special regulations within this regard (as a side take note, readers might remember how the closure associated with the Netherlands-Antilles based bank First Curacao International Bank inside 2006 and the particular arrest of billionaire banker and oil based trader John Duess seemed to be apparently lower to this sort of fraud. )
I might state it is really unlikely that Kitco were deliberately engaged in this, yet they probably made the mistake of expecting the Canadian government to enjoy by the rules. Once Kitco has paid the taxation and received a valid invoice, it’s most certainly not Kitco’s responsibility to make sure the third gathering actually pays the taxes due. Kitco didn’t design the particular system. Unfortunately, Revenu Quebec doesn’t seem to see this that way.
Basically, Accounting Firms in Canada is concerning teaching people a lesson. Those included in the precious metal business are certainly not popular with authorities. Those receiving tax rebates are certainly not popular either. In addition to the Canadian taxman has learned through the US about high profile, advertising seeking cases exactly where you accuse initial, destroy somebody’s business, then later look at the facts.