AFE Bailment Process
Bailment according to wikipedia:
“Bailment describes a legal relationship in common law where physical possession of personal property, or chattel, is transferred from one person (the ‘bailor’) to another person (the ‘bailee’) who subsequently has possession of the property. It arises when a person gives property to someone else for safekeeping.Bailment is distinguished from a contract of sale or a gift of property, as it only involves the transfer of possession and not its ownership. To create a bailment, the bailee must both intend to possess, and actually physically possess, the bailable chattel. Bailment is a typical common law concept although similar concepts exists in civil law (Spain- Depósito).In addition, unlike a lease or rental, where ownership remains with the lessor but the lessee is allowed to use the property, the bailee is generally not entitled to the use of the property while it is in his possession.Moreover, unlike a security agreement or pawn at a pawnbroker, where the secured party is entitled to the possession and use of the property only on default of payment, a bailor can demand the return of the property at any reasonable time, without prior notice.A common example of bailment is leaving your car with a valet. Leaving your car in a parking garage is typically a license, as the car park’s intent to possess your car cannot be shown. However, it arises in many other situations, including terminated leases of property, warehousing (including store-it-yourself) or in carriage of goods.”
Bailment is distinguished from a contract of sale or a gift of property, as it only involves the transfer of possession and not its ownership. This is important, as you remain the sole legal owner of your gold and silver, while AFE is only your custodian.
The Bailment Process
When AFE orders gold or silver bars from one of several LBMA certified refineries, those bars are then poured, certified, and transported to the secure vaulting facilities by certified armored carrier and fully insured for the full market value while in transit.
Once the metal is unloaded from the armored trucks, the individual bars are sight inspected and verified against a “weight list” of bars from the refinery by a third party Bullion Auditor, a representative of AFE, and a representative of the vault.
The reports from this sight inspection as well as deposit receipts from the vault are made available to the Independent Trustee for verification against the records of AFE and accounts of AFE clients.
By governance contract, no metal can be removed from the vault without approval of the Independent Trustee, and the presence of the duly appointed third party Bullion Auditor, and a representative of the vault.
Grant & Thornton checking off LBMA Bar numbers, with ViaMat agents at ViaMat Security Vaults in Kloten, Zurich.
ViaMat Security staff placing seal numbers on individual pallets.
‘Good Delivery’ silver bar with LBMA refinery Hallmark and bar number