Quote:
Originally Posted by Casey2296
I learned the hard way as a creditor who didn't file one, that a properly filed UCC-1 takes senior position over debt not protected by one. The Vault assets may not be viewed as company assets but you never know what the BK Trustee is going to do when things go South, your cards could be tied up for years. If you have a substantial dollar amount in the vault it would be prudent to file a UCC-1.
Like my Dentist says, "you don't have to floss all your teeth, just the ones you want to keep".
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Exactly right Casey (and sorry to hear you ended up having to learn it the hard way). Plus, does anyone truly know what the exact recordkeeping and documentation functions and procedures are of these vault operators? If their records and/or documentation are not all they should be, it can make proving someone's ownership of items they are holding all the more difficult and definitely prolong recovery of them.
Believe it or not, there actually may be a way to find out and better assure yourself that these vault operators are handling and keeping your vault-held items safe and properly accounting for and keeping records of them. And you can thank CPAs for it. If you are already using, or thinking of using, a vault service, simply ask them for a copy of their most recent SOC-2 report on their vault service. And if they tell you they don't have one done (or even worse have no clue what you're talking about), ask them when they're going to start having one done so you can get a copy.
I'm going to guess none of them currently have one done, nor want to voluntarily go through the time and expense of doing so. But if they did, doing so would definitely enhance their transparency of what and how they do things and add tremendously to public/customer confidence in their services being provided.
And for those that don't know (which is likely most anyone reading this) what an SOC-2 report is, SOC now stands for "System and Organization Controls" (and originally stood for "Service Organization Controls) and is basically a detailed description, examination of, and report on what a service company like a vault operator/provider does (or at least says they're supposed to be doing), how they do it, and how well they do it. There is no explicit legal requirement for any service company to have such a report done, but can be a definite determining factor in people and businesses deciding who they will ultimately choose and hire to provide services for them.