Offshore Investing Tips

Offshore Banking Will Change How You Look At Banks

2007-07-13T12:47:00.000-07:00

Understanding the concept of offshore banking can change the way you look at banking. The term offshore banking has two definitions, which we'll term 'legal' and 'functional' for the purposes of this article. Since the differences and definitions of offshore banking have been so badly blurred and confused by almost everyone, it is necessary to define them separately and then explain how and why the confusion exists. Only by understanding both definitions of offshore banking, their relationship and their differences can an investor truly make a decision based on facts rather than speculation and assumption.

In the legal community (lawyers, governments), offshore banking refers to a bank licensed to do business only outside the jurisdiction in which it is incorporated and licensed. This means that a bank holding an offshore banking license may engage in many of the activities including but not limited to savings, checking and loans normally carried out by any other bank. However this offshore bank cannot offer or provide these services to the residents of the particular jurisdiction that the offshore bank is incorporated and licensed in.

Some jurisdictions allow licensed offshore banks to provide services normally provided by any other mainstream bank: in Vanuatu for instance, the ANZ and Westpac banks - despite being strictly speaking offshore banks to Vanuatu - can still provide any and all banking services to residents and non-residents alike. Other jurisdictions, such as the United States, tend to limit the functions of offshore banks to the provision of a few specified services.

To the general public, an offshore bank is any bank outside the investor's country of domicile. For example, a US resident maintaining any type of account in a bank in Canada would class that bank as offshore. Any time you have money deposited or invested within a bank in a country outside the country in which you live and work, you are considered to be banking offshore even if that bank is only across an imaginary borderline - such as the one between the US and Canada.

You might think that a bank is a bank, no matter what its structure - offshore bank, offshore licensed bank, or domestic bank. In reality, it makes no difference how a bank is actually set up and structured, where it is licensed or where it does business, since all banks generally use the same channels to facilitate the movement of money. Because all banks are indirectly connected through their correspondent and inter-bank relationships, in theory there should be no real confusion arising from bank transactions, regardless of jurisdiction.

The confusion associated with offshore banking is only a matter of legal jurisdiction, arising from the fact that no country can impose their laws within another country without the first country's consent and cooperation.

The confusion surrounding offshore banking is also its beauty. Due to the wide variety of laws around the world, what is considered illegal in one country may be entirely legal in another. While a country can investigate anyone residing within their country for violating their laws, that same country would have no legal right to investigate someone in another country without first obtaining the consent and cooperation of the country in which the investigation is to be conducted. Then, even if permission is granted, the investigation can only be conducted under the laws of the country in which the investigation is to take place.

To give you an example, the US cannot investigate anything in Canada, without first obtaining the consent and cooperation of the Canadian government - who would be totally within their international rights to refuse, or to not cooperate with the investigation. Countries will normally not offer assistance to another country without the establishment of a specific treaty or agreement, especially when the country is enforcing or investigating an offshore crime.

Offshore banking is an elusive concept, but one that is well worth your time to understand fully: without that understanding of offshore banking, navigating offshore investment waters can be far more challenging - and far less rewarding.

This article is just a snippet of the Global Investing Home Study Course

"Who Else Wants To Learn The Truth About Offshore Investing And How To Capitalize On The World's Most Explosive Economies?"

Click Here To Download Your Free Offshore Investment Report And MP3

Investment Opportunity Offshore - Getting Better Returns On Your Money

2007-07-13T12:20:00.000-07:00

It has been said that national boundaries have rarely been an effective barrier for investment opportunity offshore investors who aggressively sought the greatest use for their investment capital. Indeed, top experts in the field of offshore investing believe that slightly over one half of an investor's portfolio should be scattered throughout foreign markets.

When you start to seriously look into having your money work for you, over time you'll realize that if you want above average returns, you'll have to look further than the borders of your home country. Once you start considering investment in terms of the whole world, you'll see that it doesn't make sense to have your all of your investments or money tied to one particular country or currency.

Not only does global investing outperform the US, but it reduces the overall risk to your investment portfolio. A globally diversified portfolio can absorb the hiccups that a geographically concentrated portfolio might otherwise be forced to feel in its entirety.

When I first realized this, I began looking at major stock markets around the world and found that every twelve years, each one had a downward trend - but not all at the same time. So, by adopting a global approach, I was able to have my money working constantly. By choosing to take advantage of investment opportunities offshore, you increase your opportunities, enhance returns and diversify risk. For example: the Morgan Stanley Capital International Index has 21 stock markets around the world, including Japan, and most of the developed markets in Europe and Asia posted a 15.1% compounded annual return for the 25 years since its inception in 1970. This was almost half again as good as the return of 10.7% for the same period for the top 500 companies traded upon the New York stock exchange as rated by the Standard & Poors.

Interestingly, 13 of the 21 MSCI markets out-performed the US market by quite substantial margins during that very same period - the Japanese market alone between 1948 and 1993 gave 20 times the return of the S&P 500.

A wise investor wouldn't invest all their money into one company alone, so why would they put all their money in one country or currency? The strength of a country's currency will affect your buying power; the prices of property are connected to that country's inflation and interest rates; and income, purchasing power and standard of living make a compelling argument to seek investments outside of your current country of domicile.

Still not convinced about the merits of investing beyond your home country?

· If, in 1996, a US investor had chosen to remain invested only in the US, they would have missed out on:

· All 10 of the worlds largest construction companies

· All 10 of the world's largest banks

· 8 of the worlds top 10 chemical companies

· 8 of the worlds top 10 machinery and engineering companies

· 7 of the worlds top 10 automobile companies

Above-average returns are well within the grasp of anyone wishing to take the time to learn the methods of investment opportunities offshore. However, most first-time investors focus on making the most money as quickly as possible, and so tend to fare rather poorly.

This article is just a snippet of the Global Investing Home Study Course

"Who Else Wants To Learn The Truth About Offshore Investing And How To Capitalize On The World's Most Explosive Economies?"

Click Here To Download Your Free Offshore Investment Report And MP3

Quickly And Easily Open Your Low Cost Offshore Bank Account

2007-07-13T12:17:00.000-07:00

The journey of a thousand miles starts with a single step. This is true of offshore investment as well – to get anywhere, you have to take the first step: opening a low cost offshore bank account. It seems like an obvious point, but making that leap causes many people much anxiety.

And it really shouldn’t – opening a low cost offshore bank account is easy and relatively painless, as long as you know what to look out for. This article will provide three simple tips that will help you open a low cost offshore bank account quickly and easily.

Before we look at the three things you’ll need to provide in order to open your low cost offshore bank account, let’s look at what you should know about offshore banks. Like their onshore counterparts, most offshore banks still require proof of identification. The number of ID’s varies, as do the rules, depending on whether you are setting up your low cost offshore bank account in person or if you are mailing in the information. If you’re opening a low cost offshore bank account in person, a passport is generally perfectly adequate in terms of ID. The banks should take a copy of your passport for their records, and then you’re done – easy as that.

If you’re opening a low cost offshore bank account by mail, three standardized pieces of identification are required, each with their own ramifications that we will address individually. These items are:

- a notarized copy of your passport
- letter from your accountant
- a letter from a bank where you have held an account for twelve months or more.

Let’s look at them one at a time. The first is simply a photocopy of your passport that has been signed and sealed by a notorary to ensure that it is your passport. It’s a quick process, but the notary will ask you a few questions, like:

a.. Why are you doing this?

b.. Why do you need this?

c.. Where is this information being sent?

Notaries are bound by law to make this information known to various government reporting agencies; feel free to be very vague with your answers, because it’s really none of their business. To make the process smoother, make your own photocopy of your passport for notarization as it saves time and money. It is also a good idea to take multiple photocopies, as some notorary republicans may be convinced to notarize multiple copies for the same price or just a little extra. If you have spare copies at home, you don’t need to go to all this trouble again.

Secondly, you’ll need a letter from your accountant, stating that he or she has known you for a period of time – basically, it’s a character reference, and shouldn’t pose too much trouble.

The third thing you’ll need to provide is a letter from your regular bank, and that’s where it gets tricky. At first glance, a letter from the bank may seem as harmless a request as that of the letter from the accountant. But in reality nothing could be further from the truth. What happens as part of the due diligence process carried out by the offshore bank is that, when they receive the letter from the bank, they then fax it back to the bank of issue for confirmation of its authenticity. Sadly, once this is done – and even though you’re not breaking the law – your privacy has been somewhat compromised. Some offshore banks now have a section on their low cost offshore bank account application forms asking permission for them to contact the issuing bank. If you ask them not to for privacy reasons, they will respect that and it should have very little bearing on the opening of your low cost offshore bank account.

For the more patient investors, open your low cost offshore bank account and let them check with the bank; twelve months later, open another low cost offshore bank account in another jurisdiction, using a reference from your original offshore bank. This way when they fax the form back for verification it still stays offshore!

Knowing what lies ahead can be your best ally in opening a low cost offshore bank account – and once you know the ins and outs of the system, you can more easily play with it to your advantage, and added privacy.

This article is just a snippet of the Global Investing Home Study Course

"Who Else Wants To Learn The Truth About Offshore Investing And How To Capitalize On The World's Most Explosive Economies?"

Click Here To Download Your Free Offshore Investment Report And MP3

Reduce The Risks Of Choosing A Cayman Island Offshore Bank Account

2007-07-13T12:14:00.000-07:00

There's no doubt about it: with its cloak-and-dagger mystique and its international allure, offshore investment is exciting. You can quickly get carried away, however, by the sense of danger - and figuring out how to avoid the real risks inherent in offshore banking is a difficult process.

This article will list the top two risks involved in choosing a Cayman Island offshore bank account, and give you some tips on how to successfully navigate them.

The first risk you face in choosing the right bank for your Cayman Island offshore bank account is finding one that will keep your money safe. You'll need to choose a large well-known bank - preferably one that does not have any direct contacts back to your own country. What is meant by direct contact is a bank that shares information with the corresponding offshore bank, or is on the same computer system and linked. The reason for using large banking institutions is so you can rest assured knowing that your money is safe.

The second risk involved in choosing a Cayman Island offshore bank account involves choosing a bank that will grant you the requisite anonymity while still protecting your investment. Quite a few of the smaller offshore banks offer complete secrecy and anonymity to their investors, and in many cases don't even require identification to open an account. My advice would be stay far away from these banks, because when they come under government scrutiny, the likelihood of all monies being frozen until all the beneficiaries come forward is fairly high.

Understanding these risks is particularly important, because choosing a fraudulent bank could be disastrous for you. Opening a Cayman Island offshore bank account can be a relatively easy procedure, but some unscrupulous people may open banks with names similar to that of a mainstream bank in an effort to separate the foolish from their money. For example, I once came across the Chase Manhattan Asia Pacific Bank Inc. At first glance, the novice might assume that this bank was related to the Rockefeller-owned Chase Manhattan Bank, but closer inspection revealed that it was a Nauru bank with a Vanuatu PO Box (Nauru is an island in the South Pacific that is famous for the mining of bird do-do and the creation of shell banks).

One final point to keep in mind when dealing with Cayman Island offshore banks is that, while their staff conduct themselves in a professional manner, time doesn't hold any real relevance for them. You need to understand that you will more than likely be dealing with an island mentality, and staff that run on island time. Although there is absolutely nothing wrong with this laid-back approach, it can be extremely difficult for someone coming from a major city perspective to appreciate. There have been many times that I have personally witnessed an irate customer speaking harshly to a poor bank teller for the speed at which they were processing a particular request. The point I am trying to make is that business is conducted at a different pace, and hurling abuse at the banking staff will not make for a good business relationship.

If you keep in mind the two tips mentioned above when choosing the right Cayman Island Offshore bank for your offshore investment, you'll successfully avoid getting scammed out of your money. You'll also be able to protect your investment while still maintaining a large degree of secrecy, and conduct professional relationships with the banking staff in charge of your account.

This article is just a snippet of the Global Investing Home Study Course

"Who Else Wants To Learn The Truth About Offshore Investing And How To Capitalize On The World's Most Explosive Economies?"

Click Here To Download Your Free Offshore Investment Report And MP3

3 Major Reasons To Open Anonymous Offshore Bank Accounts

2007-07-13T12:08:00.000-07:00

Choosing a bank is one of the most important decisions you’ll ever make, so you need to know all the facts. More and more people are opting for anonymous offshore bank accounts: Why? What’s so great about offshore banking?

This article will give you three main reasons why anonymous offshore bank accounts might be for you: profit, privacy, and protection – or the 3 P’s.

Let’s look at each reason separately, starting with profit. I’m going to use Australia as an example to illustrate my point, because Australia is so highly taxed. As an Australian worker, you’re taxed on your wages; you buy a few things, paying a 10% goods and services tax. You then place your remaining money in a bank, where you’re charged financial institution duty, and bank account debit taxes. Despite this, you earn a tiny amount of interest – on which you are also taxed. If this seems excessive to you, you’re not alone: banking offshore eliminates at least the last of these taxes.

Having anonymous offshore bank accounts isn’t illegal and probably never will be. You can legally move your money anywhere you want in the world: there is absolutely no restriction on the amount you can move, or where or how you move it. To come back to the Australian example, while there is no restriction on the movement of money offshore, amounts of $10,000 or more are required to be reported to the relevant government authorities. There is also a question on Australian tax return forms asking if you have $50,000 or more invested offshore: this is an individual limitation, so if you have a spouse or child, you can always put the money in their names.

The first reason for which you might want to open anonymous offshore bank accounts is simply that it’s profitable: you eliminate taxes, and you gain access to investments only offered in particular jurisdictions, which can negate the need for a structure. Finally, the compounding effect of money is phenomenal in a tax neutral jurisdiction.

The second major reason for anonymous offshore bank accounts is its offer of privacy. Many people don’t even realize lack of privacy is a problem, so the concept of it can seem totally foreign: in most westernized countries, there is no protection of your private banking details. Let me outline for you three simple steps to discovering the fundamental flaw in banking systems that don’t employ heavy penalties for banking secrecy. First, get a hold of someone’s bank account details. This is nowhere near as difficult as you may expect: if someone pays you by check, you then have access to their account details. Secondly, with those account details, go to a branch of the same bank. Never go to the branch where the account is held. Lastly, fill in a deposit slip for $10.00 and, when you deposit it, ask the teller for ‘your’ balance.

Yes, it’s really that simple to invade someone’s privacy – including your own. Anonymous offshore bank accounts have tenets of privacy and secrecy that will help you to protect your identity and your money.

This brings us to the final P in the 3P’s of anonymous offshore bank accounts: protection. The third reason anonymous offshore bank accounts are such a popular banking solution is that they protect your assets. Unlike the account mentioned in the example above, if a bank account had been held in an offshore jurisdiction, it would have been virtually impossible to find out the balance of the account. In most offshore banking jurisdictions, there are heavy fines and jail terms for the disclosure of any information relating to bank accounts.

Be careful, however: although Internet banking onshore is commonplace, if you intend to do this with offshore banks you need to be aware that all of your information is stored on your hard drive.

Profit, privacy, and protection: these are the three assets anonymous offshore bank accounts provide that no other account can. What you do with that information is entirely up to you.

This article is just a snippet of the Global Investing Home Study Course

"Who Else Wants To Learn The Truth About Offshore Investing And How To Capitalize On The World's Most Explosive Economies?"

Click Here To Download Your Free Offshore Investment Report And MP3