-- Posted 26 January, 2005 | |

Dear Friend of GATA and Gold:

Despite recent assurances to the contrary from the
U.S. Treasury Department, U.S. law still appears to
empower the president to seize gold and silver coins,
bullion, and shares in mining companies from private
citizens.

While the law may violate the U.S. Constitution's
prohibition against the government's taking private
property for public use without paying fair
compensation, it puts precious metals investors in
some jeopardy. So GATA has written to the Treasury
Department seeking clarification and a meeting with
department officials.

The text of GATA's letter is appended.

Protecting precious metals investors and the mining
industry against threats like this would seem to
come within the province of the World Gold Council.
But the council does no advocacy of precious metals
when governments may get in the way, and little
advocacy in any case, so this work has fallen to
GATA.

The Treasury Department is not likely to respond
to GATA's letter without some prodding from the
congressmen who represent metals investors and
mining companies, so U.S. citizens are asked to
share the letter with their congressmen and the
mining companies in which they are invested and
to ask the congressmen and mining companies to
get involved with the issues the letter raises.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

* * *

GATA LETTER TO TREASURY DEPARTMENT

January 20, 2005

Roberta K. McInerney
Assistant General Counsel / Banking and Finance
Department of the Treasury
Washington, D.C. 20220

Dear Ms. McInerney:
 
Michael Kirk of U.S. Rep. John B. Larson's office has
forwarded to me your letter to him of December 17,
which answered my e-mailed inquiry to him about
forcible redemption by the Treasury Department of
gold and silver coins held by private citizens. You
replied that a statute empowering the Treasury
Department to do that, 12 U.S.C. Section 248(n),
had been repealed.
 
But since reading your letter I have learned of a
similar statute: Title 12, Chapter 2, Subchapter IV,
Section 95a, which provides in part:
 
"During the time of war, the president may, through
any agency that he may designate, and under such
rules and regulations as he may prescribe, by means
of instructions, licenses, or otherwise -- (A) investigate,
regulate, or prohibit, any transactions in foreign
exchange, transfers of credit or payments between,
by, through, or to any banking institution, and the
importing, exporting, hoarding, melting, or earmarking
of gold or silver coin or bullion, currency or
securities. ..."
 
Section 95a further authorizes the president to "prevent"
the "use" by U.S. citizens of any property "in which a
foreign country or a national thereof has any interest."
 
These provisions are of the greatest concern to investors
in gold and silver bullion, coins, and shares of gold and
silver mining companies, and to those companies
themselves. So the Gold Anti-Trust Action Committee
urgently requests that the Treasury Department explain
how it construes these provisions. Particularly, we'd like
to know:
 
* How does the Treasury Department construe "the time
of war"? How can gold and silver investors know when
the powers described in Section 95a are in operation or
likely to come into operation? Are formal declarations
of war by Congress required here, or lesser declarations,
or none at all, but rather declarations made only by the
president?
 
* How does the Treasury Department construe "hoarding"?
Does it include the ordinary collection of gold and
silver coins, numismatic or not, and bullion by U.S.
citizens, businesses, and corporations, absent any
collaboration with enemies of the United States?
 
* Does the Treasury Department construe Section 95a
to empower the president to interfere with the ownership
of shares in gold and silver mining companies merely
because shares of such companies also might be owned
by foreign nationals or foreign governments, at war with
the United States or not? Under what circumstances
would the president be so empowered?
 
In essence, we need to know whether Section 95a
contemplates the instant destruction of gold and silver
investors and the precious metals mining industry in the
United States. So the Gold Anti-Trust Action Committee
asks the Treasury Department for a meeting with the
officials who might become responsible for implementing
Section 95a, at which we might discuss the concerns of
precious metals investors and mining companies. Would
you kindly forward our request to the appropriate people?
 
Thanks for your help.
 
Sincerely,
 
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
-- Posted 26 January, 2005 | |