Offshore Banks and Asset Protection

At 8:57 PM 1/12/96, Rich Graves wrote:
>Every issue of The Economist (and I'm sure lots of other publications)
>has ads for this kind of thing.
>
>Anyone know a reference for ranking the "legitimacy" of these services
>and seminars? I'd assume that many of them are scams that will gladly
>take your money overseas, but you might never see it again.
>
>Probably follow up offline, because cpunk relevance is a bit tenuous.

I'll follow up on the list, because it's a topic of interest (or
curiousity) to several, and I favor writing for the list.

I looked into "asset protection" [see note below] using offshore banks
(Carribean, Channel Islands, Europe, etc.), and bought a couple of books on
this. And I subscribed to some Net newsletters. I'm not an expert, and have
not chosen (yet) to "protect" my assets by moving them offshore.

I think the assumption that most of the ads in the back of "The Economist"
are scams which will take your money is wrong. The banks will take your
money, but most probably will return it on demand. And the seminar
companies will in fact teach some things.

However, they may be "scams" in a gentle sense: they won't provide easy
solutions that many of us will feel fully comfortable with. By this I mean
that one is hit with dozens of competing claims, by reports that the IRS
and FinCen are infiltrating these banks, that treaty negotiations will soon
close these tax havens, and all sorts of stuff like this. Things which do
not inspire confidence. (In fact, the report that these
back-of-the-Economist ads are "scams" is perhaps part of this
disinformation/rumor campaign.)

Like a lot of things, it may all be clearer once one has actually gone
ahead and done something with these offshore banks. I don't personally know
anyone who has, which adds to my uncertainty.

[Note: Many advisors call their schemes "asset protection," rather than
"tax sheltering" (or "tax evasion"). The idea is to put assets beyond the
reach of tort judgments. For example, a doctor may fear the incredibly
large "deep pockets" lawsuits that American society encourages, so he
transfers a large fraction of his net worth to an offshore bank. He reports
income from these assets to the IRS, so he is not a tax evader, just
someone who has partially "judgment-proofed" himself (to use the term
Duncan and Sandy use). This is not illegal, currently. Lots of issues to
consider.]

--Tim May

We got computers, we're tapping phone lines, we know that that ain't allowed.
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Timothy C. May              | Crypto Anarchy: encryption, digital money,
tcmay@got.net  408-728-0152 | anonymous networks, digital pseudonyms, zero
W.A.S.T.E.: Corralitos, CA  | knowledge, reputations, information markets,
Higher Power: 2^756839 - 1  | black markets, collapse of governments.
"National borders aren't even speed bumps on the information superhighway."

That's not what I wrote!!! :-)

On Fri, 12 Jan 1996, Timothy C. May wrote:

> I think the assumption that most of the ads in the back of "The Economist"
> are scams which will take your money is wrong. The banks will take your
> money, but most probably will return it on demand. And the seminar
> companies will in fact teach some things.

I did say "many," not "most," and I would assume that most if not all
stuff that The Economist carries is completely legit. I'd been thinking of
"other publications," such as the tax protester rags and my friend 
Clark's paper. 

> not inspire confidence. (In fact, the report that these
> back-of-the-Economist ads are "scams" is perhaps part of this
> disinformation/rumor campaign.)

Yep, I'm just an FBI plant. (Yes, I know -- or rather assume -- that
that's not what you meant.)

Be careful of this paranoid stuff, even as a joke. The tax protester
movement feeds on conspiracy BS. "The IRS knows that native born white
Sovereign Citizens don't have to pay Federal taxes, but they've paid off
all the Jew lawyers." There was a guy in misc.legal a while back making
this so-called argument. People were actually sending him money, and not
out of pity. 

Which is not to say that the guvmint isn't conspiring against us all, in
the larger and some specific senses. Just not quite like that, and it's
the wacky conspiracy theories that make otherwise intelligent people
discard others. (Some people still don't believe in Watergate. *I* didn't
believe the Feds could legally get a wiretap without a warrant until I 
was corrected here.)

> Like a lot of things, it may all be clearer once one has actually gone
> ahead and done something with these offshore banks. I don't personally know
> anyone who has, which adds to my uncertainty.

This falls under the category of Things That Only The Mega-Wealthy Clique
(of all races, politics, and sexual colors) Know. 

Which is a category that shrinks more and more by the day. Some people
actually used to believe in the Divine Right of Kings. We've come a long
way, baby. Keep it up.

-rich

On Fri, 12 Jan 1996, Timothy C. May wrote:

> At 8:57 PM 1/12/96, Rich Graves wrote:
> >Every issue of The Economist (and I'm sure lots of other publications)
> >has ads for this kind of thing.

And The Economist wisely puts notices warning readers to use there own
discretion on such services.  Great mag, it gave some of the best and 
sanest articles on the internet ever printed in the "popular press".

> >Anyone know a reference for ranking the "legitimacy" of these services
> >and seminars? I'd assume that many of them are scams that will gladly
> >take your money overseas, but you might never see it again.
> 
> I looked into "asset protection" [see note below] using offshore banks
> (Carribean, Channel Islands, Europe, etc.), and bought a couple of books on
> this. And I subscribed to some Net newsletters. I'm not an expert, and have
> not chosen (yet) to "protect" my assets by moving them offshore.
> 
> "tax sheltering" (or "tax evasion"). The idea is to put assets beyond the
> reach of tort judgments. For example, a doctor may fear the incredibly
> large "deep pockets" lawsuits that American society encourages, so he
> transfers a large fraction of his net worth to an offshore bank. He reports

Beside there rather ambigous value as "asset protection" and "tax
sheltering", the main reason people use offshore banking is to gain better
interest rates.

In Thailand, the Bangkok International Banking Facility offers interest
rates on deposits that are several percentages higher than normal banks. 
The banks of the facility work under a different set of banking laws from
normal banks.  Also, the interest rate on loans also tends to be lower. 
I'm not sure whether international funds are subject to local (thai) or
international (us) tort judgements though, but many of the banks in the
BiBF advertise to offer high privacy and security. 

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Patiwat Panurach      	     Whatever you can do, or dream you can, begin it.
eMAIL: pati@ipied.tu.ac.th      Boldness has genius, power and magic in it.
m/18 junior Fac of Economics		-Johann W.Von Goethe
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