Germany lowers limit on anonymous gold buying. Germany passed new legislation in late November to discourage anonymous gold buying. Starting next year, gold dealers there will not be allowed to sell more than €2,000 worth of precious metals without recording customer information. This has created a rush for gold from people looking to convert their cash to precious metals.

Traders must not only keep a copy of the identification document for a cash purchase above this limit, they are also required to conduct customer due diligence. That is, the gold dealer must investigate whether the customer has a criminal background. In addition, when making a cash transaction, the dealer must investigate who the gold is ultimately intended for.

Currently in Germany there is a limit of €10,000 for an anonymous purchase of precious metals, as in the Netherlands. It is still possible to settle for a larger amount with cash, but then a customer identification requirement applies. Also, in accordance with anti-money laundering legislation, the trader must report an unusual transaction. So starting next year, this limit in Germany will go down from €10,000 to €2,000. For imaging purposes, that's just enough to buy a one troy ounce gold coin. A Krugerrand or Maple Leaf costs almost €1,400 at the current gold price.

RUSH FOR GOLD

Due to new legislation, several gold dealers in Germany will stop selling gold anonymously starting next year. Due to the reduced limit and the extension of the obligation to investigate, it is less profitable to offer this service any longer. We have learned from several sources that a run on gold has now begun in Germany. Private individuals wishing to buy anonymous gold should preferably do so before the end of this year.

LIMIT ON CASH

Last summer we already wrote about this bill to discourage the use of cash. It is part of a European approach to combat terrorist financing and money laundering. All member states have the task of implementing these European directives into national legislation. The purpose of this European approach is not only to further tighten the rules, but also to harmonize them at the European level. Currently, there are still major differences between countries in the regulation of cash.

There are also plans in the Netherlands to curtail opportunities for anonymous gold buying. Earlier this year, the Dutch government came up with a "plan to tackle money laundering. This includes the proposal to prohibit cash transactions above €3,000. The Dutch government wants to reduce the use of cash because it cannot trace these flows of money.

The contribution "Germany lowers gold limit" is from Geotrendlines and goldstandard.com