It is no secret that secret Swiss bank accounts are not so secret anymore, as political elites throughout the world led by the U.S. government wage an all-out war against financial privacy, even to the point of scheming to stamp out cash. But Swiss financial innovation knows no bounds. To meet the intensifying demand for financial privacy and for protection against unstable banks, negative interest rates and other "unconventional" monetary policies, Swiss entrepreneurs have purchased and refurbished former military bunkers hidden deep in the bowels of the Swiss Alps and transformed them into huge warehouses for storing gold. Unlike banks, these warehousing firms are not obliged to report suspicious activities to Swiss federal authorities, nor are U.S. citizens storing gold abroad outside of financial institutions legally required to report such holdings under the U.S. Foreign Account Tax Compliance Act. There are currently 10 gold storage firms operating out of submontane bunkers. One Alpine company is so marvelously secretive that the owner refuses to publicly disclose his name or even the name of his company. Evidently business is booming. According to Swiss customs records, In the first half of 2016, Switzerland imported 1,357 metric tons of gold valued at about $40 billion.
Of course, this development has not escaped the notice of the U.S. government and its minions. John Cassara, a former U.S. Treasury special agent who has written books on money laundering, notes that gold is a big part of the Swiss economy. Cassara is "not surprised that there are not more effective efforts in Switzerland to better monitor its misuse. The powers that be don’t want to crack down." And he suggests, "Perhaps gold should be subject to currency cross-border reporting.” Unfortunately for the lovers of financial freedom and privacy "the powers that be" in Switzerland answer to the World's Only Superpower, for whom Cassara is a mouthpiece.
Joseph T. Salerno is professor of economics in the Lubin School of Business of Pace University in New York. He is editor of the Quarterly Journal of Austrian Economics; Academic Vice President of the Mises Institute, and Director of the Mises Institute Fellows Program. Contact: email.
