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Got emails back from support about the questions I asked in line with the topic here.
Basically there is a security trustee that would act on our behalf should tally cease trading. I asked for further details about who this trustee is and was advised they will be updating the FAQs with the info once they have them all tucked up.
Until this I will be advising my folks to only put small amounts in, as want to see this info nice and transparent before encouraging big drops.
Below is a copy of the mails I got
"Thank you for getting in touch and this is a great question.
Tally gold is 100% insured through our accredited vault provider in Switzerland. Further Tally gold it is ring-fenced under a security trustee arrangement that, in the event that anything happened to the Company, the security trustee would step in, sell all of the Tally customers' gold to convert it back into fiat currency, then send 99% of the balance (there is a 1% admin charge for this service) attributed to each customer, to their nominated fiat-currency bank account
"All these details will be made available via FAQs very soon about who to contact in the event Tally does not exist. We are just making sure that all the details and wording fall in line correctly from a legal prospective and trustee, once this has been cleared all this will be on the website.
Only up to £85,000 after that.. good luck.
"I'd rather have to get my gold back from an insolvent tally than money from a failed bank."
Alliance & Leicester
Bradford & Bingley
Royal Bank of Scotland Group
All failed but no one lost their money.
But, like I said, your choice and I respect that.
I'm not suggesting anyone believe me as I haven't stayed anything as a fact, I said I would ask the question if the T&C's weren't updated to include the information on full launch but b1 is going to ask anyway so we'll cross that bridge when we get to it.
The bank may be regulated but if they decide to keep your money for a bail in, good luck with the regulators, I'd rather have to get my gold back from an insolvent tally than money from a failed bank.
Your broker is regulated
Your bank is regulated
TallyMoney is not.
It's your money - please don't believe an anonymous poster on a public bb - if you want the answers ask the regulator. Or not. Your choice!! :-)
I appreciate what it says but that's the same with everything.
Your broker has legal title to your shares.
Your bank has legal ownership of your money.
Tally has legal title to the gold. If they disappear the gold is held in my name, but with who and where, sure the regulator may have the detailed info but surely it's a simple question to ask tally before involving the regulator.
Customer Contact Centre:
c o n s u m e r . q u e r i e s @ f c a . o r g . u k
"The conversation started with wanting to know the contact details and process of getting access to the gold we hold, that's the answer I wanted."
7.2. TallyMoney shall retain legal title to any gold purchased by TallyMoney on behalf of the Customer
Surely the answer is right there? ...if TallyMoney "retain legal title" there is no way a third party is going to hand over that gold to anyone but them.
So one day out of the blue the app doesn't load/
No reply to emails
No one picking up the phone.
Who do you turn to?
If the regulator can do nothing you are stuffed.
That's why I suggested asking the regulator **before** the (hopefully never happen) event.
I appreciate it doesn't bother you personally but perhaps others, such as b1gdeano would actually like to know where they stand... any amount of reassurance from the company concerned is surely worth nothing if they disappear which is the hypothetical question, however the regulator can answer that 'what if' reliably.
Customer Contact Centre
The conversation started with wanting to know the contact details and process of getting access to the gold we hold, that's the answer I wanted. The regulator wouldn't necessary know those details but they should be easy enough for tally to pass on.
"Hoping they come back with a decent answer and not a swerve or other evasive answer."
Come on b1gdeano, get real, what do you honestly expect from 'silver-tongue' CP ???!!!
If you genuinely want to quantify the risk then why not email the regulator for impartial, trustworthy & reliable advice on where you stand if this does go pear shaped?
Like I said, hopefully it will never happen, but no harm knowing where you stand.
Cool, we can look forward to the answer.
Sure, but piggy backing would still mean they have to adhere to the regs or they'd lose the right to do so. The closest comparison example I can think of is glint who are regulated by the same and they have just had an investment from Sprott and I'm assuming they carried out serious due diligence.
Glint Pay Services Limited (company No. 10117131) is authorised by the Financial Conduct Authority under the Electronic Money Regulations 2011 (FRN: 900657) for the issuing of electronic money
Well I have emailed them asking them to lay out what would happen should tally cease trading either via insolvency or any other reason.
Hoping they come back with a decent answer and not a swerve or other evasive answer. Will let you know the outcome.
"TallyMoney Ltd (E-Money Directive Agent FCA Ref. No. 902059) under FCA-licensed E-Money Institution, PayrNet Ltd (FCA No. 900594)."
Correct me if I'm wrong, but I believe this only means that TallyMoney Ltd are effectively 'piggy backing' another company's licence (only to make & receive electronic payments), so no protection to the consumer whatsoever.
"The regulation of them is not a worry for me."
Fair enough, we all have our own tolerance for risk and who's to say what's right & wrong; however I personally believe it may limit uptake from the more risk averse. Time will tell.
That sounds like a perfectly reasonable question to ask, it'll be interesting to read the reply.
Well I have managed to talk my retired parents into buying some tally with some of their savings, on the basis that gold is rallying and likely to continue for the rest of the year.
Though I will be emailing tally to ask about the scenarios laid out here if tally were to disappear. If they arent clear or transparent with the info then I will be advising my folks to only put a small amount in, not huge chunks. Wouldn't want to be in a situation where they lose their money on my relatively "safe" investment advice.
TallyMoney Ltd (E-Money Directive Agent FCA Ref. No. 902059) under FCA-licensed E-Money Institution, PayrNet Ltd (FCA No. 900594).
Tally is trading within the current financial system, banking, mastercard and gold storage which is fully and overly regulated. I dont think we should confuse this 'alternative' (crypto/digital) currency which is less regulated for now. I'm pretty sure they're not able to simply do anything they want to. The regulation of them is not a worry for me.
"I dont know where the idea came from that they are unregulated, I'd be interested to see it."
Like all 'alternative' currencies they fall outside the remit of the regulator and as such (to the best of my knowledge) there's nothing for them to adhere to. Don't get me wrong, there's nowt dodgy or illegal about what they're doing but it is nevertheless not covered, or protected, by UK or international law. Hence the risk.
I dont know where the idea came from that they are unregulated, I'd be interested to see it. Working in the banking and financial system I'd imagine the amount of regulations they have to adhere to is ridiculous. And yes, I appreciate railsbank carry a lot of the regulations side but that wouldn't be the totality of it.
"No doubt if tally went pop, they would be legally obliged to inform all holders of gold how and to whom they would contact to claim it."
As TallyMoney is unregulated I'm not convinced their would be any legal redress?
"Trust" seems to be the operative word, but that may not be enough for some - particularly if they are making larger deposits.
I works much like a nominee account with shares I guess... All my tally shares were thrown into a nominee account where Barclays stockholders were the legal owner but when I decided to take possession they pulled out the quantity I owned and sent me a share certificate so now my shares are not in that pot with all the rest.
No doubt if tally went pop, they would be legally obliged to inform all holders of gold how and to whom they would contact to claim it. But, as I said and you mentioned, it would be, for the sake of transparency and to alleviate any concerns, a good idea to simply put it in the T&C's now.
Thanks for sharing that JonnyE
The one that is probably of most concern is:
7.2. TallyMoney shall retain legal title to any gold purchased by TallyMoney on behalf of the Customer but will hold the gold on trust for the Customer.
Unclear where this leaves 'the Customer' if TallyMoney were to disappear.
Hopefully in practice it would never be an issue, but it may nevertheless deter more cautious investors when they are conducting due diligence?
7.11. TallyMoney’s storage partners also provide industry specific insurance cover to protect your gold holding. This cover to you is included in our fee structure. TallyMoney’s storage partners provide TallyMoney with documentary evidence of this insurance, which TallyMoney is happy to publish knowing that some customers will want to confirm that existence of this cover and its terms.
7.12. You acknowledge and accept that certain Custodians in certain jurisdictions may request your name and address details in order to comply with their anti-money laundering and KYC procedures and checks. By submitting your application, you authorise TallyMoney, where necessary, to send your name and address details onto such Custodians for this sole purpose.
7.13. Gold stored by Custodians are allocated, meaning that the quantity of bullion which is owned by TallyMoney’s Customers at any one time is fully backed (i.e. if it was ever required, it would be possible to distribute that bullion amongst TallyMoney’s Customers in the quantities owned) and regarded as your property by the vault operator or storage provider. Furthermore, each Custodian will keep the gold held in the name of TallyMoney on behalf of its Customers physically segregated at all times from assets owned by other parties. However, gold are not separated by the Custodian according to individual TallyAccounts and therefore the Customer’s ownership does not relate to a specific bar of bullion, i.e. it is not identifiable, but to a specific quantity of gold in a storage facility provided by TallyMoney’s Custodian.
I appreciate what you are saying.. and following full launch, If the company has not updated the T&C's, I would be asking them who we would contact should Tally go bust. I would prefer to see some contact information regarding the custodian/insurers and/or info on who to contact if things went bad with tally and we couldn't contact them.
7. Custody of your Gold
7.1. TallyMoney uses third party vault operators and storage providers in the field to provide secure custody of your gold assets, and by submitting your application, you authorise TallyMoney to act as agent to arrange the storage, transportation and insurance of your gold. You authorise TallyMoney to enter into contracts on your behalf in relation to the storage, transportation or insurance of your gold (‘Third Party Contracts’) and acknowledge and accept that such Third Party Contracts may contain provisions permitting a lien to be exercised over the gold in certain circumstances.
7.2. TallyMoney shall retain legal title to any gold purchased by TallyMoney on behalf of the Customer but will hold the gold on trust for the Customer.
7.3. TallyMoney will engage a member of the London Bullion Market Association (or any successor body) to buy, sell and store gold purchased on behalf of Customers (‘Custodian’).
7.4. TallyMoney will pay the Custodian the fees for storage and insurance of your gold. These fees are included in the annual fees for the TallyAccount, which are detailed in the Fees, Charges & Limits Information Document.
7.5. In the event of loss or damage of the gold by the Custodian, any proceeds of insurance for such risks shall be credited to the Customer’s Bank Account or used to purchase Tally at the option of the Customer.
7.6. TallyMoney will engage (either directly or indirectly) an international courier company to transport the gold purchased by TallyMoney for the Customer (‘Carrier’).
7.7. In the event of loss or damage of the gold by the Carrier, any proceeds of insurance for such risks shall be credited to the Customer’s Bank Account or used to purchase Tally at the option of the Company.
7.8. Customers may not inspect the gold purchased by TallyMoney.
7.9. Gold purchased under these Terms will be held as weighed bars of gold in vaults operated by the Custodian in Switzerland or other locations agreed between TallyMoney and the Custodian from time to time.
7.10. TallyMoney warrants that your gold is held as bailment for the sole purpose of ensuring proper safekeeping, and legal protection of your assets within professional vaults.
JonnyE >> "if tally go bust you are still the owner of the gold in Switzerland, you'll still be able to gain access to it even though it might be a bit harder with the paper work involved"
I don't want to labour the point but if TallyMoney Ltd were to disappear surely 'ownership' of the gold goes with them... While users of Tally might 'theoretically' own the underlying asset what have they actually got in practice without the app? ...Does anyone using Tally right now have any evidence of title outside the app? ...Do you even know where, and by who, 'your' gold is being stored?
If TallyMoney Ltd disappears what have any of the users actually got???