Alan"s Money Blog

Jul 26, 2007

About BullionVault

Who and what is behind BullionVault?

:: The company

BullionVault is owned by Galmarley Limited [name origin], which is company number 4943684 registered in Great Britain.

You can see a list of shareholders at Companies House on

Our offices are in West London (UK) and we welcome callers by appointment. Our contact details are here.

Our services are delivered by our own computer machinery hosted in separate locations in Britain and USA, which we connect to and manage from our London offices.

Galmarley is involved exclusively in gold and gold related information technology. It owns not only but also

The galmarley site is a free educational resource for researchers seeking information on gold's monetary history, its modern role, and how it is traded around the world. It has grown to become one of the most visited and studied gold resources on the Internet.

Feedback from Galmarley’s many tens of thousands of visitors inspired the development of the BullionVault service.

:: People

BullionVault achieves its significant cost savings for you through automation, which enables Galmarley to operate with a full time staff of just three. They are Paul Tustain (CEO), Alex Edwards, and Kris Jenkins. Click their names for a mini-biography.

All three are very experienced computer professionals with backgrounds in banking and accounting systems, internet and telecommunications networks, operating systems and security. Between them they own 73% of the fully diluted equity of Galmarley.

Naturally we regard ourselves as both trustworthy and capable. But we well understand that many people considering buying gold are justifiably ultra-cautious. This is why we have made BullionVault records open and accessible for your audit; so that all our visitors can see at any time that we are running our business honestly, efficiently and accurately.

We have also further committed to your protection in the capital structure of the company.

:: Capital
Galmarley's capital is arranged in three layers to provide maximum customer protection with maximum management accountability.

Each layer of Galmarley capital is subordinated to you and protects you in front of the capital’s owners.

:: The layers are :-

Approx $1.89m (£1m) convertible redeemable bonds
Approx $1.75m (£0.925m) management bonds (100% owned by the company's officers and founders)
Approx $0.5m (£212k) equity (73% owned by the company's officers)
The equity capital provided the funding for the BullionVault development, while the bond capital provides a pool of cash and gold to enable a deep and liquid gold market on the BullionVault order board.

Consequently the company’s bond liabilities - its only liabilities - are 100% balanced by cash and gold reserves. This figure compares with the 12.5% liquid reserve of most modern banks.

Above and beyond those reserves the equity shareholders reserve is in surplus, meaning the cost of site development has been redeemed to the company in cash. This shareholders' reserve is also employed as cash and gold inventory on the BullionVault order board, further protecting you and bondholders - in that order - with exceptional asset liquidity.

The status of the $1.75m management bonds deliberately puts our management at financial risk. It protects both you and our outside investors – in that order – and personally commits our management to the continued safe and efficient operation of our business.

The convertible redeemable bonds protect you too. They are owned by outside investors in the company who monitor the management of BullionVault and ensure that the management bonds are not risked.

However all this caution in the Galmarley structure is secondary, because the gold you buy on BullionVault and store at Brinks is your outright property. Our structure ensures that the continued prosperity of Galmarley, Lloyds TSB bank, and even Brinks – or their failure – has no impact on your ownership of your gold. You retain the ability to realise its proper market value whatever the future may have in store for us.

:: Biographies
Paul Tustain introduces himself and the BullionVault team.

"Here's some background about us. Because of what we're doing I believe introducing the people behind the company is important.

I graduated as a Computer Scientist. From 1980 to 1986 I worked for an investment company in London as an equities analyst, and then for four more years, to 1990, I specialised in computer systems for financial instrument administration, regulation and risk measurement.

In 1990 - as European share markets were moving to electronic depositaries - I founded SAM Systems to further develop a new type of software which I had designed for administering the electronic settlement of immobilised stocks and shares. My product was selected and used by several of Europe's major banks as their bulk settlement and custody solution for electronically held stocks, shares and currencies. It became one of the most successful solutions in the sector, occasionally processing $120bn a day through CREST - the UK's Central Stock Depository.

I'm still a major shareholder and now non-executive director of SAM.

In 2000 I became an early shareholder in a company called ‘Betfair’. It was founded by my bridge partner who had invented the concept of the 'betting exchange'. Betfair allowed gamblers to back and lay horseracing bets direct with each other, through an innovative internet based exchange system. Although I know nothing about horses I thought it was both fairer and more efficient than the alternatives. In 3 years it grew to dominate 90% of Europe’s on-line horse betting and now turns over approximately $20billion a year. It has become one of the world's biggest internet success stories.

From 2000-2003 I developed a growing interest in gold. I have been published quite widely on the internet on economics, economic history, gold and currencies. I am also the editor and publisher of which (according to my mailbox) is well regarded as a free educational resource on the web for prospective gold buyers. From its inception this site has been collecting data about services gold investors are looking for.

Much of the feedback from Galmarley's web visitors backed up my experience of how incredibly difficult it is for private buyers to set up the facilities to buy gold. This bothered me because the history is clear: accessible bullion ownership has regularly provided the essential defence for people who have saved some money, and would rather not surrender it to the riskier financial practices which tend to develop over time.

So in 2003 I decided the gold market would benefit from the exchange techniques I'd seen work so well at Betfair, compounded with a strongly beefed up approach to efficient administration and investor protection for bullion owners.

The result - BullionVault - brings together my experiences in administration and risk management systems, immobilised assets, electronic settlement, internet based exchanges, and gold.

BullionVault is designed to be something I would choose for myself, with complete confidence, even in times of real international financial crisis. I wanted it to be extremely secure; I wanted it to offer transparently fair terms of business to its customers; and I wanted it to be very good value. I believe it now offers by a considerable margin the best method of buying and securing bullion for gold purchasers all over the world. I use it myself as a secure store of wealth, and I willingly underpin its security for you through our management bonds which guarantee your security against any dishonesty or error at BullionVault.

Let me now introduce my colleagues, each of whom is on the way to owning 6% of BullionVault and is as dedicated to our business as I am.

Alex Edwards graduated in Computer Science from Swansea University and has Masters Degrees in (i) Communications Systems and (ii) Telecommunications Business. He was senior systems analyst at British Telecommunication’s Research & Development Labs for Fraud and Revenue Assurance. He has unique experience of developing advanced artificial intelligence software for monitoring anomolous transaction patterns across a range of networks and systems. He is also an expert on Java development. Alex replied to an advert I put in New Scientist magazine in 2003, and by a happy co-incidence he was already buying gold for himself!

Kris Jenkins holds a degree in Computer Science from Nottingham University. He came straight from University to work for me at my last company, SAM Systems, in 1998. After several years with us he left to travel the world, but I snapped him back up as soon as I heard he had returned. He is the company expert on Unix, web server architecture, databases and real-time accounting and keeps a keen eye on the best software to power our systems.

We are approachable. Let me take this opportunity to invite our users to contact us whenever you like via email, and in person should you choose to visit London.

Paul Tustain - June 2004

:: Responsibility

As the head of the board and majority shareholder Paul Tustain accepts responsibility within the company for organising BullionVault's system controls and arranging individual responsibilities within the BullionVault team, and its custody providers, so as to maximise the security of customers' gold and cash.

In addition to development capital Paul Tustain has provided management bonds to the company which is held as gold and cash segregated in favour of customers. These management bonds are non-refundable except in final liquidation, in which circumstance they rank behind all other customer property for repayment.

The value of equity in the company and this loan would therefore be lost before any BullionVault customer incurred any loss resulting from breaches of faith or security on

This arrangement is structured to underpin the meaning of 'accepting responsibility'.

What are BullionVault's strategic objectives?
BullionVault's objective is to create the world's most cost-effective, secure and accessible market in professional grade gold bullion.

:: We want to do this because :-

We believe there is a deficit of financial responsibility in many modern governments and financial institutions.
We believe that modern currencies and other paper based value systems will inhibit savers from retaining their domestic and worldwide purchasing power.
We believe that using gold to provide protection from this problem is a strategy which has become inaccessible to individuals.
We believe that we are uniquely well qualified to re-build that accessibility and to manage the service in a way which maximises security, accessibility and value for our customers.

There you have it folks, all the info I managed to find about BullionVault. I trust BullionVault enough to put a considerable amount of my wealth with them. I'll let you decide if this is right for you. I hope you do decide to make the smart choice of protecting your financial future and purchase some gold or silver, and in my opinion BullionVault represents the best method that I've come across for direct gold ownership.

Take care everyone.

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