| A Guide to Offshore Banking
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| | held in the name of a foreign corporation
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| Offshore banking has often been
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| | (IBC) or trust. This insures that asset
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| associated with the underground economy
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| | collectors and agencies cannot locate it.
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| and organized crime, via tax evasion and
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| | By taking advantage of these methods an
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| money laundering; however, legally,
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| | individual or corporation becomes a
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| offshore banking does not prevent assets
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| | smaller target and the likelihood of
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| from being subject to personal income tax
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| | being sued is reduced. Utilizing offshore
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| on interest. Except for certain persons
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| | tools to protect privacy could mean the
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| who meet fairly complex requirements ,
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| | difference between keeping and losing
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| the personal income tax of most countries
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| | what is rightfully yours.
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| makes no distinction between interest
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| | Tax Efficiency
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| earned in local banks and those earned
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| | As stated above, your savings,
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| abroad. Persons subject to US income tax,
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| | investments, assets or business profits
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| for example, are required to declare on
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| | can grow almost free of any form of
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| penalty of perjury, any offshore bank
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| | taxation. This does not mean tax
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| accounts-which may or may not be numbered
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| | avoidance, it simply means whilst your
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| bank accounts-they may have. Although
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| | assets are held offshore they will
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| offshore banks may decide not to report
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| | benefit from very favourable tax
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| income to other tax authorities, and have
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| | advantages. There will for many however,
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| no legal obligation to do so as they are
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| | be a potential tax liability when you
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| protected by bank secrecy, this does not
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| | look to repatriate your assets to your
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| make the non-declaration of the income by
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| | home country. This will depend on your
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| the tax-payer or the evasion of the tax
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| | nationality and your country of residence
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| on that income legal. Following September
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| | at the time of repatriation.
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| 11, 2001, there have been many calls for
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| | Asset Protection
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| more regulation on international finance,
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| | There are many methods in which to
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| in particular concerning offshore banks,
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| | protect your assets using an offshore
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| tax havens and clearing houses such as
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| | structure, in the form of an investment
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| Clearstream, based in Luxembourg, being
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| | product, an IBC (International Business
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| accused of being a crossroads for major
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| | Company) or a offshore trust, or even a
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| illegal money flows.
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| | simple offshore bank account. These will
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| An offshore bank is a bank located
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| | protect your assets from:
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| outside the country of residence of the
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| | * Protection from invasive bureaucracy
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| depositor, typically in a low tax
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| | * Protection against lawsuits
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| jurisdiction (or tax haven) that provides
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| | * Protect your assets from seizure
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| financial and legal advantages. These
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| | The simplest form of protection offshore
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| advantages typically include some or all
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| | is the nature of the offshore privacy
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| of:
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| | rules. What isn't known can't be
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| * Strong privacy
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| | attacked. The basic form of offshore
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| * Less restrictive legal regulation
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| | privacy combined with a IBC or Trust is a
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| * Low or no taxation (i.e. tax havens)
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| | very secure method to legally protect
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| * Easy access to deposits (at least in
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| | your assets from prying eyes.
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| terms of regulation)
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| | Lawsuits are filed every week.
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| * Protection against local political or
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| | Ex-spouses, ex-business partners,
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| financial instability
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| | disgruntled employees or predatory
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| While the term originates from the
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| | lawyers may file a suit if they believe a
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| Channel Islands "offshore" from Britain,
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| | potential defendant is an attractive
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| and most offshore banks are located in
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| | target. Losing such a lawsuit could cause
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| island nations to this day, the term is
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| | a lifetime's worth of savings,
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| used figuratively to refer to such banks
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| | investments and real estate holdings to
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| regardless of location (Switzerland,
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| | be lost. In light of this, placing assets
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| Luxembourg and Andorra in particular are
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| | offshore is a wise and effective means of
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| landlocked).
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| | protection from frivolous lawsuits.
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| What type of services are available from
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| | Once your assets are held offshore they
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| offshore banks? The same as the services
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| | are unreachable by domestic courts. In
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| from any high street bank, plus the
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| | the event of a lawsuit, a defendant may
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| extremely confidential Swiss style
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| | be forced to forfeit domestic assets, but
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| numbered accounts. Many of the offshore
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| | offshore assets will remain untouched.
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| banks listed on this site are respected
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| | Offshore courts do not recognize or carry
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| AA credit rated international banks, that
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| | out domestic judgments. This insures that
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| everyone has heard of before. They have
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| | assets sent offshore will remain
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| simply set up an offshore division or
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| | confidential, secure, and permanently in
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| branch division within a tax haven to
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| | the hands of their rightful owners.
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| attract a share of the enormous
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| | Moving assets offshore will create peace
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| international trade, and offer almost the
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| | of mind that what's yours will always be
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| same services as any domestic bank. Such
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| | yours.
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| as the following:
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| | Regulatory Advantages
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| * Personal and corporate current/checking
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| | The regulations in force within most high
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| account
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| | tax countries, are there to protect
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| * Personal and corporate savings accounts
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| | investors, and rightly so. However, due
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| * Secure internet banking facilities
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| | to the very strict nature of these
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| * Anonymous numbered accounts (extremely
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| | regulations, fund managers feel as if
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| confidential)
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| | they are wearing a financial straight
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| * Debit and ATM cards, which are accepted
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| | Jacket. It is difficult for them to
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| globally
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| | compete with the returns of their
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| * Credit cards
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| | offshore-based partners who enjoy less
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| * loans
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| | restrictive regulation. Many offshore
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| * Mortgages
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| | jurisdictions have very mature regulatory
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| Going offshore in simple terms means
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| | systems in place, often based on those
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| placing your savings, investments, assets
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| | present within the US or the UK, yet they
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| or business concerns outside of your home
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| | allow fund managers great freedom to add
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| country, within one of the many tax
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| | value for their investors. This is why
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| havens. A tax haven is a country that has
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| | offshore funds nearly always outperform
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| very favourable tax advantages, which
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| | their onshore equivalents. Within the
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| means that your savings, investments,
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| | high regulation onshore countries,
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| assets or business profits can grow free
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| | excessive rules and bureaucracy often
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| of almost any taxation. Although taxation
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| | plague domestic businesses and
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| is only one reason why many decide to go
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| | operations. Valuable resources are
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| offshore.
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| | diverted away from the productive process
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| Privacy
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| | in order to monitor compliance as a
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| To protect the free flow of your personal
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| | result of the restrictions imposed.
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| information and dealings. An offshore
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| | Curing this problem is as simple as
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| entity has no obligation to release your
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| | moving to friendlier shores. Offshore
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| personal or business information,
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| | jurisdictions are intentionally
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| affording you with a great deal of
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| | business-friendly and have regulations
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| privacy & confidentiality. In general
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| | that are straightforward, simple to
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| terms your personal information will not
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| | understand and inexpensive to comply
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| be divulged to any governing body or tax
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| | with. Moving a business offshore and
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| authority unless suitable evidence can be
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| | enjoying a more pleasant business climate
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| shown to prove that you have been
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| | may require nothing more than forming an
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| involved in criminal activities, such as
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| | offshore corporation and transferring
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| money laundering or drug trafficking.
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| | assets from the domestic corporation to
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| Financial privacy is becoming a thing of
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| | the foreign one.
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| the past. Almost every single transaction
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| | Is all of this legal?
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| made at a bank or ATM, by law, must be
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| | Do you trust your current bank or
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| recorded and filed. Consumer credit
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| | investment provider? Chances are that
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| agencies maintain databases full of
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| | they too have an offshore operation; most
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| sensitive information that is used and
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| | of the world's major banks and investment
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| shared by other organizations and
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| | companies have an offshore present. Do
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| agencies. Asset collectors routinely
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| | you honestly believe that a triple A
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| advertise their ability to locate bank
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| | credited rated investment company or bank
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| accounts, brokerage accounts, and real
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| | would operate in an illegal activity?
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| estate and business holdings. Should
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| | Companies such as Merrill Lynch, HSBC,
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| asset collectors find substantial wealth,
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| | ING Barings, UBS, Barclays, Deustche
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| the individual or corporation becomes an
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| | bank, ABN Amro all have offshore
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| easy target for a lawsuit.
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| | operations. It is not the offshore
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| Unless ethical and legal steps are taken
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| | industry itself that is illegal, it is
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| to insure privacy, sensitive and
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| | only the devious activities of certain
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| confidential information could easily get
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| | individuals who may give the offshore
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| into the wrong hands. Placing your
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| | industry a poor reputation. It is also
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| assets, investments, savings bank and
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| | true that the due diligence, and money
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| brokerage accounts offshore will keep
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| | laundering checks performed by offshore
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| them off the asset collector's radar
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| | companies is increasing, especially after
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| screen. Consumer credit agencies and
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| | the 911 terrorist attacks. Which will
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| government departments do not have access
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| | ensure that it becomes difficult for
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| to foreign account records or
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| | criminals to abuse the offshore industry.
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| transactions. Domestic property may be
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