As with cash, the federal government now wants to significantly restrict anonymous purchases even in the case of gold. Officially, it is about the fight against money laundering. But critics fear a hidden attack on the freedom of citizens. The fact is: other countries are already much stricter.
The Federal Government wants to drastically lower the upper limit for anonymous gold purchases: From 2020, precious metal traders should already control the personal details of the buyer and carry out a risk analysis for an amount of more than € 2,000. This emerges from a draft bill of the Ministry of Finance, which still needs to be discussed in the Bundestag.
Up to now, anonymous gold purchases in Germany are capped at 10,000 euros. For comparison, even a simple 50-gram bar costs more than 2000 euros – a purchase would not be possible without disclosure of personal information.
What the gold traders need to check
Specifically, the requirement requires buyers to provide proof of identity. If a company acts as a buyer, the trader must clarify before the deal, who is “beneficial owner”, which real people hide behind the company, if they each own at least a quarter of the company.
Due to the increased duty of care dealers must also check whether there are indications of a criminal background with the business partner. The business relationships are also examined in the case of persons or companies from “high-risk countries” and “politically exposed persons”.If a dealer suspects, he must report his potential customers to the authorities. If a trader fails adequately to comply with these obligations, he faces severe fines.
Even other industries affected
The bill is due to enter into force on 10 January 2020 and implement applicable EU directives on money laundering (Money Laundering Act). The background is the EU’s increased fight against money laundering and terrorist financing. The Directive (EU) 2018/843 includes various measures, accordingly, the draft bill of the German Ministry of Finance in addition to the gold market areas such as the real estate industry, gambling, the art market or the crypto-money industry. They are all considered particularly vulnerable to money laundering.
It is not the first measure intended to restrict the use of cash. Already two years ago, the general cash limit was lowered from 15,000 euros to 10,000 euros – with reference to the same reasons that are now being sought.Even then, critics of the measures expressed the suspicion that the legislature had a completely different intention: the creeping dehydration of cash use in the population. A comprehensive control of all cash flows would ultimately make it much easier to enforce monetary and interest rate decisions.