FAQ – Regulation and Best Practices

Strategic Gold is not an investment management or fund management business. You are not giving us money to invest on your behalf, nor do we offer investment advice regarding when or what to buy or sell. We simply enable you to buy, hold, sell and take delivery of precious metals.

While Strategic Gold Corporation strictly adheres to the highest business and governance standards, the firm is not required to be registered with any regulatory authority. The firm is not subject to registration under the securities laws as a dealer or investment adviser because it’s activities are limited to non-securitized, physical gold and physical silver bullion. Accordingly, the firm’s activities:

• Are not governed by the Securities Act of 1933. All precious metal bullion owned and held in a Strategic Gold Clear Title Account is specific, allocated, unencumbered gold and silver bullion and is not a securitized form of the precious metal.
• Are not governed by the Investment Advisers Act of 1940. Strategic Gold does not engage in management or advisory services.
• Are not governed by the Commodity Futures Trading Commission (“CFTC”). The CFTC regulates the futures market. Section 742 of the Dodd-Frank law exempts any “contract of sale that – ‘‘(aa) results in actual delivery within 28 days or such other longer period as the Commission may determine by rule or regulation based upon the typical commercial practice in cash or spot markets.” Clear Title Account owners take delivery of their precious metals on settlement date (T+2) as evidenced by their Bailment Agreement with the Company.

In addition, the firm is not subject to regulation as a Money Services Business (“MSB”). Strategic Gold Corporation requires as part of its account application and opening documentation disclosure of the account holder’s bank account and bank representative. All money that is used to fund Clear Title Account bullion purchases must originate from this linked account. Likewise, any money disbursed from the Clear Title Account is sent back to that same bank account on record. Due to this “closed system” structure the firm is not considered a Money Transmitter.

For more information, or to request our ‘Model Due Diligence Questionnaire’, please contact us via email at accounts@strategicgold.com or call us at 239 692-9154.

• ADDITIONAL RESOURCES:
• Overview of Corporate Governance
• Overview of Industry Standards
• Overview of Risk Management

Yes. The Company maintains and reviews written compliance policies and procedures which are included in its Code of Business Conduct and Ethics.

Strategic Gold believes that quality governance begins with sound principles. Board independence, independent auditor review, strong internal controls, and transparency are at the center of the Company’s governance and compliance structure. Strategic Gold Corporation is committed to its governance principles and their inculcation into the Company’s culture. Accordingly, the Company has adopted a Code of Business Conduct and Ethics (the “Code”).

In addition, the Company adheres to the business standards established by the London Bullion Market Association (“LBMA”). The LBMA is an international trade association, representing the London market for gold and silver bullion which has a global client base. This includes the majority of the gold-holding central banks, private sector investors, mining companies, producers, refiners and fabricators.

Our designated Corporate Compliance Officer has over thirty years experience at the senior executive level in the back office functions and operations of financial services organizations. The Senior Management Committee and Corporate Compliance Officer operate under strict corporate policies and guidelines to insure the total integrity and safety of the bullion and cash holdings within all client Clear Title Accounts. The Company maintains and reviews written compliance policies and procedures which are included in its Code of Business Conduct and Ethics.

Also included in the Code is a policy for the handling and safeguarding of all material, non-public information. Part of the Corporate Compliance Officer’s duties includes a review and attestation from all key personnel for the safeguarding of this information.

For more information, or to request our ‘Code of Business Conduct and Ethics’, please contact us via email at accounts@strategicgold.com or call us at 239 692-9154.

• ADDITIONAL RESOURCES:
• Overview of Corporate Governance
• Overview of Industry Standards

Strategic Gold Corporation believes that risk management is fundamental to its mission. The Company was created to respond to the systemic risks to the financial system identified during the financial crisis of 2007-2009 and which we believe continue to pose an ongoing threat.

The Company believes that the only way to insure against systemic risk is to directly own reserve assets or safe haven assets which are held outside the financial system. Direct ownership of physical gold and silver uniquely meets this criterion since they are the only non-financial assets that are highly liquid and easily held outside of the financial system.

To ensure that we fulfill this business strategy and philosophy, we have developed a comprehensive Enterprise Risk Management (ERM) program which arms the Company with the tools and capabilities to overcome the barriers that arise in striving to protect our clients. By realizing that risk and control is everyone’s responsibility, the Company proactively identifies and manages the risks that it is exposed to in the normal course of operations.

By incorporating risk management into our daily business practices and by integrating the related performance measures into our operations, the ERM program ensures that we maintain the highest ethical standards by living our core values. Utilizing a “top down” and “bottom up” approach to measuring, responding and controlling risk exposures and any correlations at client account and enterprise levels we strive to continuously improve our enterprise-wide risk controls.

Our ERM program allows us to identify not only the risk mitigation activities, but also to anticipate and act on potential opportunities—therefore challenging conventional wisdom to create better solutions for our clients. Risk management is a circular process. The undertaking of risk management procedures leads to the identification of previously unidentified sources of risk. For this reason, our ERM program is expected to be a living process, and will be continuously updated for changes in risk management opportunities and threats.
Our ERM program proactively identifies, assesses, reports and controls risks. This comprehensive approach to risk management promotes broad strategic thinking and analysis, while fundamentally integrating the Company’s core values and beliefs. To this end, we believe that risk management is one of our key features.

• ADDITIONAL RESOURCES:
• Overview of Risk Management

Clear Title Accounts are free from counterparty risk. With Strategic Gold you have ownership of your precious metals at all times, and you also always have the option of taking physical possession. If Strategic Gold were to wind-up for any reason, your ownership of your specific precious metals would not be affected.

To protect the precious metals you buy and hold in your Clear Title Account, these and other important aspects of our business are regularly audited. Strategic Gold hires an independent bullion auditor and an independent transaction auditor to oversee the proper maintenance of your assets. These independent third-party verifications, our comprehensive governance procedures and Enterprise Risk Management System, provide assurance that your precious metals are safe. You can view audit reports in your secure online account.

• ADDITIONAL RESOURCES:
• Overview of Risk Management
• Independent Bullion Auditors
• Independent Transaction Auditors

Strategic Gold Corporation in collaboration with a leading software providing company designed, developed and deployed its own customized Precious Metals System software (the “PM System”). The PM System allows for the establishment of accounts, recording of cash receipts, cash disbursements, bullion purchases, sales and transfers, fee processing and collection, account reports, reconciliations, and complete audit trail production. The software also incorporates data transmission to the secure Client Login section of the Company’s website where a complete and transparent transactional account history and current cash and bullion holdings and valuation are available. The PM System incorporates an approval process for all transactions to include trade processing, settlement and cash movement.

Strategic Gold Corporation receives and includes in its trade transaction reports a confirmation number that is provided by its bullion trading partner. The bullion partner also provides a detailed bullion bar list with the specific refiner’s mark, serial number, weight, and fineness for all bullion purchases. For sale transactions, the PM System generates a report of the specific bullion bars sold from an account for the authorization to release the bullion for settlement. This detail is included on the transaction report provided to each client and available via the secure Client Login on the website. All transaction reports are reconciled to both the confirmation and bar list provided by the bullion trading partner.

For more information, or to request a demo of our Client Portal, please contact us via email at accounts@strategicgold.com or call us at 239 692-9154.

• ADDITIONAL RESOURCES:
• Login to the Client Portal

To ensure that your precious metals are safe and secure, Strategic Gold works closely with independent service providers as partners to complete all essential functions under carefully designed checks and balances that reinforce accountholder protections and the safety of each accountholder’s assets. This system of checks and balances between Strategic Gold and its various service providers – and the clear audit trail they establish – create a reliable and trustworthy arrangement with important customer safeguards. These include insurance of your metal, dual control over the addition and removal of metal in the Strategic Gold system and a continuous, one-to-one ratio of metal in the vault to metal recorded in Strategic Gold’s Precious Metals System database.

To ensure that all governance procedures and operating systems are working properly, Strategic Gold is audited by two separate and independent auditing firms every quarter. These audits include visits to the vault to confirm that the weight of gold and silver stored there are the same exact bars recorded in a client’s account as well as the verification of all cash movements and balances. These audit reports are available for download by Strategic Gold customers in their secure online account.

• ADDITIONAL RESOURCES:
• Independent Bullion Auditors
• The Safety of Your Bullion
• Independent Transaction Auditors
• The Safety of Your Money

Absolutely not, you maintain Clear Title to your assets at all times and you have the unfettered right to take delivery of your gold at any time. For as long as your bullion assets are held in your Clear Title Account, they remain your outright property, stored in specialist facilities run by accredited professional vault operators who are wholly independent of Strategic Gold Corporation. As evidenced by the Bailment Agreement, we are simply the administrator of your assets, never the owner.

When you hold your assets with us, you are truly isolated from the systemic risks in the financial system. You have taken legal delivery of your gold and/or silver and you own it directly in physical form. Unlike the majority of investment products no company’s financial failure can deprive you of these assets. Strategic Gold, or any individual custodial vault could fail – and your assets are still safely yours. No one else may claim title of your bullion assets.

• ADDITIONAL RESOURCES:
• Bailment
• More information on Bailment
• Bailment and business failure

No. Your bullion is your property and is allocated to you only. It is not the property of Strategic Gold nor the bullion vault custodian(s), nor is it vulnerable to creditors of either.

Upon signing the Bailment Agreement when you open an account with Strategic Gold, it is established that you have uncompromised, direct legal title – Clear Title – to the gold and silver that you own. Therefore, failure of our company or associated companies does not affect your gold ownership.

• ADDITIONAL RESOURCES:
• Bailment
• Bailment and business failure

If for any reason Strategic Gold stops operating, the Strategic Gold Operational Procedures for Circumstances In Extremis will be initiated. An independent Trustee has been established in order to fully protect the individual property rights of our clients and their holdings upon the occurrence of any such event. The Trustee maintains access to the firm’s mission critical systems and database. Our vault custodians and trading partners have agreed to recognize the Trustee as the lawful administrator/agent of the Clear Title Program in Circumstances In Extremis for the benefit of each client.

• ADDITIONAL RESOURCES:
• Business Continuity Plan
• Circumstances In Extremis

In the unlikely event that one of our vault custodians stops operating, we will contact you in order to provide you with a list of alternative vaults where you can securely store your assets.

All custodial vaults within our network are monitored based on their performance and compared to our service standards. Strategic Gold Corporation employs a comprehensive selection strategy when choosing secure custodial vaults. All potential providers within a market are reviewed for the following key criteria:

• LBMA certification
• Services and responsiveness
• Security credentials
• On-site due diligence
• Accessibility
• Reputation and standing in local market

The vault facilities house the most modern systems for safekeeping and administering real assets. All working processes in these maximum-security vaults are fully automated.

Strategic Gold has implemented a Business Continuity Plan (BCP) to ensure that operations can continue without significant interruption to customers in the event of a disaster. A ‘Disaster Event’ is any risk event that significantly impairs the ability of Strategic Gold to operate at its primary facilities in Naples, Florida with its primary personnel. The BCP is reviewed, tested and updated annually to ensure the business can handle disruptions while minimizing downtime to customers. The BCP covers key aspects of Strategic Gold’s business such as the information technology (IT) infrastructure, operations and customer service.

Strategic Gold’s operations and customer service teams can be recovered to a separate disaster recovery location. The secondary site is equipped with computer and communication facilities required to support operations with minimal disruption. Each member of the operations team has an appointed alternate for the purpose of maintaining continuity in executing customer orders, bank transactions and vault operations.

If you have additional questions on our Business Continuity Plan, please contact one of our account representatives at 239 692-9154.

• ADDITIONAL RESOURCES:
• Business Continuity Plan

If you have any complaints in relation to the service being provided by Strategic Gold, you should contact our Naples office immediately at 239 692-9154. In particular, if you dispute, disagree with or have any issue with the content of any communication sent to you by email or by mail you must contact Strategic Gold immediately. Strategic Gold shall be entitled to assume your acceptance of the content of an email or postal communication if within three business days of the date of transmission to the correct email address or the date of service of such postal communication (as the case may be), no response from you has been received by Strategic Gold.

Strategic Gold shall use all reasonable endeavors to resolve any issues communicated to us by you, but you acknowledge that any delay in communicating such dispute, disagreement or issue may prevent or reduce the value of any resolution of such matter.