Why Get Offshore Banking Accounts?offshore banking accounts

The painful reality is that the entire western banking system is insolvent. This is not meant as an attention getting headline. Instead, it is simply based on fact from a thorough and careful investigation.

Let’s quickly look at the data from the United States, the earth’s biggest and most vital banking system :

1. Many of the “too-big-to-fail” banks in the US (Citigroup, for one) have not passed their “stress tests”.

2. The FDIC’s insurance fund does not contain even close to the amount they are required by law to preserve to be able to properly and legally insure the US banking system.

3. The Federal Reserve itself is virtually insolvent. Its capital ratio currently rests at only 1.23%. Lehman Brothers had fallen to 3% right before they went bankrupt.

4. The US government’s “net worth”, which is all of its assets minus all of its liabilities, is NEGATIVE $17 trillion.

offshore banking accounts

Summarily, in the US we have inadequately capitalized banks backed by an inadequately capitalized insurance fund backed by a virtually insolvent central bank and a thoroughly insolvent government. Once more, this is not just some crazy speculation. These are all facts with publicly obtainable information. We realize what an unbelievably painful conclusion this is for most people to take in.

Many Governments from around the world, from Greece to the US, can simply freeze and seize your cash and not even have to demonstrate their case. Various countries, from the UK to the US to Canada, have by now either passed or initiated legislation that will make it easy for the government to confiscate their people’s bank deposits…your bank deposits.

The facts are painful, but this is the world we live in. The clear conclusion is simple: if every piece of objective data suggests that all of the major players in your country’s banking system are considered insolvent, does it make any sense to keep 100% of your money there?

Seems like a ‘NO’ to me. Our recommendation is to consider establishing offshore banking accounts as at least a way to geographically diversify your risk.

Offshore jurisdictions you consider should have a stable financial sector, low debt, low taxes, and not have a history of looting their banks in dire times.

 offshore banking accounts

    What is Offshore Banking?offshore banking accounts

Offshore banking usually refers to using banks not located in the jurisdiction where the customer lives, whether it is a person or corporation.

These banking services are frequently looked for in jurisdictions that have lower tax rates, sometimes known as tax havens, which allow both legal and financial advantages.

The use of an offshore bank account provides the strongest financial confidentiality in existence. Financial havens accommodate foreign investors through the creation of austere laws, which forbid the release of account holder names to any foreign government or outside party. Unless criminal activity such as money laundering or terrorism has been proven, the account holder may rest securely knowing their information is kept privately.

If you open an offshore bank account in your personal name, it will only be provided protection by the privacy laws of one jurisdiction, but by creating your new bank account with the name of your new offshore business, you will receive two levels of privacy.

An offshore business banking account provides the best level of privacy since all banking transactions are done in the name of the offshore business rather than in your name. For an even higher level of privacy, two offshore bank accounts may be created for sending money out of your home jurisdiction. The first transfer may be traced from your home account to your offshore account, but the second transfer of one offshore account to the other would be completely private.

Offshore banks provide customer service 24/7, Visa and MasterCard debit cards, online banking, managed accounts, lending and confirmed deposits. Basically, all modern banking conveniences are on hand with the strongest confidentiality, better interest rates and they even provide offshore investment opportunities.

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   Benefits of Offshore Bankingoffshore banking accounts

Offshore banks usually provide corporations and private individuals with the following benefits:

– Increased Confidentiality

– Reduced or No Taxes

– Easy Access to Money

– Protection from Your Home Country’s Social, Financial, and/or Government Instability

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 Two Broad Types of Offshore Banking Accountsoffshore banking accounts

Type 1: Ordinary savings account for private or commercial use, with a minimum opening balance of $1,000US to $10,000US; and

Type 2: Private bank accounts which specialize in investment banking and that require a higher minimum opening balance of $100,000US or more (some may require a $1,000,000US minimum balance).

Type 1 Offshore Banking Account

Designed for you if you need:

– a place to simply “park” money

– a bank account for receiving commission or dividend payments

– an all-purpose commercial sort of account

Your investment options are generally limited to CD or term deposit kinds of investments. You will receive little or no investment advice or personalized banking services. It comes with broad internet banking capabilities so the need to speak with a bank officer is a fairly rare event.

Type 2 Offshore Banking Accountoffshore banking accounts

With this type, you will receive a more personalized service and some investment portfolio managing. They may offer a variety of investment choices besides the basic term deposits, and quite often may offer “in house” investment products.

The bank will expect a considerable minimum amount to be left on deposit at all times, in order to maintain the relationship. Furthermore, the bank is only interested in long-term relationships with the expectation that the majority of money stays on deposit for a minimum of six months and preferably much longer.

This works out perfect if you have a nest egg and desire to maintain it in a private, safe, and conservative manner for the long term. It is a poor choice if funds will need to be moved in and out on a regular basis.

Type 2 offshore banking accounts have been conventionally represented by Switzerland; however, Switzerland no longer offers the best confidentiality, as is widely known. Singapore and Panama now offer the best secrecy. A type 2 offshore bank will usually call for a personal visit; however, they will come to see you if the deposit is big enough.

Arrangements can be made to set up type 2 offshore banking accounts in other jurisdictions on a case-by-case basis. This usually has to be done in combination with an IBC set up in the same jurisdiction.

A couple examples of this are a Seychelles IBC with a Seychelles bank account or a Hong Kong Private Limited Company with a Hong Kong bank account.

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 Best Jurisdictions for Offshore Bankingoffshore banking accounts

Fairly simple documentation requirements, the lack of the requirement of a physical presence in the bank, and the option of using multiple currencies has made these our most popular offshore account jurisdictions:

Belize

Saint Vincent

Among the best offshore bank account choices, with excellent privacy and confidentiality laws, but where physical attendance is usually required are:

Panama

Hong Kong

If you are unable to obtain a banking reference letter, we may be able to provide facilitated bank account opening alternatives in:

Hong Kong

Seychelles


offshore banking accounts

Jurisdictions with Weak Banking Confidentiality

A few offshore banking jurisdictions have so critically worn down their banking confidentiality laws that we no longer propose them as appropriate jurisdictions in which to bank.

These jurisdictions consist of the following British territories:

– Montserrat

– Turks and Caicos Islands

– Cayman Islands

– Bermuda

– Isle of Man

– The Channel Islands

We are not saying to absolutely avoid these jurisdictions at all costs, as all jurisdictions currently have a minimum of twelve information sharing accords with specific countries. This is the minimum required to get on the international banking “white list.”

Since 2014, the US enacted law FATCA (Foreign Account Tax Compliance Act) makes it difficult for a citizen of the US to acquire any kind of banking confidentiality if the new bank account contains more than $50,000US in it at any given time. This is because FACTA obligates foreign banks to report on US citizens in order to maintain a US based correspondent banking arrangement. US citizens have always been required to report their offshore account with over $10,000US in it, so as far as reporting requirements are concerned, nothing changed other than one may no longer have the option of hiding the existence of the offshore bank account.

Other countries may try to copy the US and keep their citizens money within their countries financial system, but it is unlikely they will be as effective.  In spite of the increase in attractiveness of alternative currencies to the US dollar, it continues to conduct 60% of financial transactions in the world.

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  Requirements for Opening an Offshore Corporate Bank Accountoffshore banking accounts

Requirements to open a new bank account naturally differ from one bank to another, but many documents are universal for all. (Note: Banks in Seychelles, Hong Kong and Singapore will not regularly request reference letters, but most other banks will).

The universal documents required to open an offshore corporate bank account generally include:

1. Certified or the original copy of the corporate papers issued by the corresponding regulatory power (Certificate of Incorporation, Memorandum, Articles of Association and By-laws,).

2. Certificate of Good Standing (if corporation is more than one year old).

3. A bank reference letter per signer on the new offshore corporation. Each bank reference will need to be on the letterhead of the referring bank. It must simply state the duration of the affiliation and something affirmative about it. Banks usually have their own approved formats.

4. A business or professional (accountant, lawyer, etc.) reference letter as above.

5. Readable copy of passport with apostille for each approved signatory, director or beneficial owner on the bank account.

6. Proof of Address (mortgage statement, utility bill, credit card statement from within the past sixty days).

7. Many banks will also require an overview or short business plan.

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offshore banking accounts

  Top 10
Reasons Why You Need an Offshore Bank Accountoffshore bank accounts

1. Take Full Advantage of Your Personal Liberty. Possessing an offshore bank account will give you many more choices. More choice stands for more liberty.

2. Reduce Your Political Risk. Governments all around the world are hopelessly descending into insolvency, which is an enormous risk to your savings.

3. Safer Banks and Banking Systems. Offshore banks are in general, a more dependable guardian of your savings.

4. Asset Protection. Governments and litigators are just two of the many that may come for your assets.  An offshore bank account provides you with some very dependable resources.

5. Currency Diversification. Offshore banks usually provide suitable online platforms, which you can use to hold foreign currencies.

6. Increased Interest Rates on Your Accounts. When looking abroad, you may find quite a few banks that are willing pay interest rates considerably higher than you’re getting at home.

offshore bank accounts7. Guaranteed Access to Foreign Medical Care. An offshore bank account, which wouldn’t be seized if capital controls occur in your home country, may piece of mind in knowing you will always have right to use to medical care abroad.

8. The Capacity to Move Quickly. If your government begins levying bank accounts or imposing capital controls, it will most likely be too late to do anything about it.

9. Maintain Confidentiality. Keeping your aggregate of foreign accounts total under $10,000US for the year and as long as they are not held in an LLC, trust or other structure, you may legally maintain your confidentiality.

10. Peace of Mind. An offshore bank account will provide protection from unsafe banks, frivolous lawsuits and the negative actions of a government going bankrupt.

Regardless of what you have heard, offshore banking is totally legal and when done correctly, has nothing to do with tax evasion or any other type of illegal activity. It’s about legally, geographically diversifying your financial risk by placing your cash assets in safe, well-funded, foreign, financial institutions where they will get well taken care of.

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