Why it is a bad idea to try to work with an offshore bank directly

By Ron • December 6th, 2008

Background – We advise potential clients that we do not divulge the names of the Offshore Banks we work with for a variety of reasons, one of which is the banks do not wish to be contacted directly by people interested in opening an account. People generally ask questions that the staff in the new accounts department cannot answer and/or are not allowed to answer.

Can you explain Bank Secrecy to me? – This is a hard question for an employee at the bank. Generally such employees would be trained in new account opening procedures and would not be qualified to provide answers to such questions. Further, this type of question would fall under the category of “legal advice” and generally speaking banks do not provide legal advice. There are many variations of questions like this i.e., how secret are wire transfers going in and out of my account, etc and in almost ALL CASES the employee at the bank is not qualified nor permitted to answer such questions.

Do I have to pay taxes on the interest I earn in my account ?- A complex question that depends on a wide array of variables. Rules vary from country to country but generally speaking there is no capital gains tax in most offshore jurisdictions so usually the answer would be NO. A new account employee at a bank is not trained enough to answer such questions and the bank does not want them providing tax advice to perspective new clients.

How can I take money out of the account ? – This they may understand but they may not offer you the extra services like secured MasterCard card, and online banking because they have no training with such and can not explain to you how they work. They have no understanding or appreciation of offshore asset protection strategies and if you do get an answer it will more than likely be incomplete.

What kind of interest can I earn ? – Here again the new account employee probably is not trained to understand the different programs such as currency, minimum deposit, term and interest rate. The new account employee is not the same as the person who works as your account manager.

How private my corporate bank account is going to be? – An employee in the bank whose job it is to open new accounts will have no idea how to answer this kind of question. They do not know how your corporation is being structured and the bank does not permit them to provide legal advice.

How long will it take for me to send and receive wires from such and such country? – This is a question for the wires department not new accounts, they will not know.

Why the Banks Prefer Customers Referred by an approved agent or intermediary

They know that the intermediary conducts due diligence on the potential accout hodler, and that the intermediary will not jeopardize their relationship with the bank by referring questionable persons.
The bank knows the intermediary already went through the same due diligence they are required to do. This means to the bank that they are not wasting their time.
The bank knows we have explained asset protection, banking procedures, how the various entities we create work, etc so the bank can focus on the mechanics of assisting the client only in the operating details of the bank account like how does the online banking program work.
The client is in a strange country and it will be much easier for the bank if the intermediary represents the client during the account opening process.

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