Offshore Banking strategy for asset protection???

[acg]

Any input from experienced forum members on setting up a foreign bank account?

Is this a method of asset protection used by anyone on the forum?

Thanks,

acg

 

[justin]

Maybe the poster with $8,000,000 can respond.

 

[Nords]

Any input from experienced forum members on setting up a foreign bank account?
Is this a method of asset protection used by anyone on the forum?

Never done it.

A friend of mine did this in the Caymans in the early '80s and still has money there, but the bank would give him up to the U.S. authorities in a heartbeat. It's my impression that many of the former banking havens now have reciprocity treaties with the U.S. and are willing to accuse anyone of being a terrorist if they have to choose between you or their charter.

The industry tends to attract a few slimeballs, too. James Darr ran a bunch of limited partnerships at Prudential-Bache in the 1980s and lied about his military background. He also lied about his business relationships and spent a lot of his clients' money before his MLPs imploded. He was eventually forced out of Pru-Bache and immortalized in Kurt Eichenwald's "Serpent on the Rock". Rumor is that he's still receiving income from some of those MLPs even though their shares are essentially worthless.

But I guess he's protecting somebody's assets...

 

[Honkie]

Almost every bank (and certainly every reputable bank with whom you would be willing to deposit your money) is required to ask whether a new account applicant is a US citizen. You then have to fill out a form/declaration which they send off to some banking regulatory body (and which presumably ends up back with some US Agency or other). Difficult to lie as you will have to provide some kind of Internationally recognised identification, which is usually a passport. To the best of my knowledge the US is the only country that spies on it's citizens overseas in this way, but maybe there are others.

CHeers
Honkie

 

[LEX]

Honkie is right. However, if you or your spouse have dual citizenship you might be able to register the account under the more favorable passport and thus, tax treaty between the jursidiction of the bank and your country of declaration.

Many use the offshore account as one of several account platforms for their overall asset management. If you travel out of the US, an out of jursidiction account may be of value as a way to park funds that you will use for your travels offshore. Moving money back and forth from the US to the offshore account and back is always wrought with transactional cost and tax issues. The IRS is always ready to assume that you are tweaking their system and they are ready to spend lots of time getting to know you better through audits if you have a nice paper trail for them to explore.

 

[bpp]

Any input from experienced forum members on setting up a foreign bank account?

Is this a method of asset protection used by anyone on the forum?

What kind of protection are you thinking of?

I have accounts in the US and Japan, which I consider to be some kind of "protection" should either country suffer some kind of systemic collapse (in the sense that I could in principle flee to/remain in the other one and pull out some cash), but I don't imagine it would provide any "protection" from creditors, lawsuits, tax collectors, etc. There is far too extensive a paper trail linking the accounts, from transfers between them and such, which anyone with legal authority could probably trace without much trouble.

Bpp

(Edited to fix a typo.)

 

[Martha]

Part of what I used to do for a living was tracing down assets people would try to hide from creditors or bankruptcy trustees. Offshore accounts were one example. If I needed the debtor to cooperate to get the asset and the debtor didn't cooperate there was always the possibilty of being held in jail for contempt. I learned quickly that jail was quite effective.

 

[Mr._johngalt]

Part of what I used to do for a living was tracing down assets people would try to hide from creditors or bankruptcy trustees.  Offshore accounts were one example.  If I needed the debtor to cooperate to get the asset and  the debtor didn't cooperate there was always the possibilty of being held in jail for contempt.  I learned quickly that jail was quite effective.   

Jail (like your approaching execution) focuses your attention
wonderfully.

JG

 

[rapoole]

In case you were thinking about using an offshore account to hide funds from the IRS, you should know that your 1040 has a box which you are required to check if you have offshore accounts. Failure to check the box is a felony (if you have such an account), and taxpayers have been prosecuted for failing to check the box.

Jay Adkisson wrote a book on Asset Protection, which provides a balanced assessment of the various strategies. I recommend it to anyone interested in the subject. Here it is on Amazon:

http://www.amazon.com/gp/product/00...103-2117827-1178203?s=books&v=glance&n=283155

rapoole

 

[mark]

Foreign accounts will not protect assets per se.

A judge can order you to retrieve the funds and jail you for contempt if you dont.

If you don't report the account (over $10,000) to the IRS, you can go to jail.

Don't expect to be able to hide the account. Electronic and paper trails will exist.

 

[acg]

The local veterinarian in town (whom was going through a nasty divorce after caught sleeping with his young, pretty receptionist) suddenly closed down his successful practice, had a shipping container delivered to his driveway, loaded it up with all his possessions, and reportedly fled with his new girlfriend to Mesopotamia to flee his pursuing ex-wife.

I guess he thought he was getting with something Maybe he did...but after reading your responses, maybe he didn't...

 

[Honkie]

It's OK.  At least we live in a free country, unlike the other sad souls in those 'poor and less sophisticated countries' who live with widespread broadband, good schools, shorter workweeks and universal healthcare. The horror. 

Meanwhile, back in America...
"Hun, where's the remote, (American Idol, Survivor, Wife Swap, Meet your New Mommy, _________ <you fill in the reality show blank>) is on an' I don' wanna miss it."

LOL

Oh, soooo cynical!!

In terms of "Protecting Assets", I understand the OP to be using "Protect" as a euphimism for "Hide", most likely from tax authorities, creditors, ex-wives etc etc.

Having a second passport/dual nationality won't protect you from the requirement to declare your US Citizenship when opening the account offshore.  You are a citizen of BOTH countries, you can't cherry pick one and ignore the other when circumstances suit.

Even if you purchase property or other assets rather than simply open a bank account overseas, the US has agreements in place such that lawyers and some other agents used in the transaction are required to ask similar questions and report the same information. So even buying a lump of rainforest in Indonesia would probably end up being reported back to some black hole in the US.  So there is no escaping Big Brother via that route either. Obviously, some operators won't actually ask the questions they are supposed to and make the reports they should, so ther ae still some enormous holes in the system.

NB: My knowledge on this is not from my own personal experience, but from that of my sister, who is an expatriate US Citizen.

It many ways it is objectionable that citizens of any country should be hounded in this way even if there life and business are on the other side of the world.

Cheers
Honkie.