Monthly Archives: May 2019

What did you do to shield your wealth?

This article will discuss many important things at once. For example, on asset protection, mixing offshore companies with onshore companies and on closing bank accounts in Hong Kong.

Right now, the BFI Inner Circle Briefing seminar is being held in the Bahamas, to which I invited my blog readers in this article:

Narrow Circle Briefing. Wealth management strategies using several offshore jurisdictions in the context of rapidly changing financial markets and regulations.

You are already late for this seminar, but if you are potentially interested in seminars in English of similar quality, I will be glad to invite you. By the way, representatives of the government of one of the tax havens of the Caribbean will attend this meeting and expressed a clear intention to seek advice on the modernization and strengthening of the offshore financial legislation of their country. The order has already been given to the government, along with strict deadlines for the delivery of the bill.

Have you done everything to shield your wealth?

One of the topics that will be discussed at the briefing sounds like the title of this article. “Have you done everything to protect your assets?” And what did you do to protect yourself? ”Have you at least thought that you need to protect yourself or how you will do this? In other words, after developing and implementing a good asset protection strategy, there is another important step. This step is personal protection. Protect your freedom, health, wealth, happiness and everything that goes with them.

Too many so-called asset protection experts focus only on the mechanics of registering excellent malta trusts to provide protection from creditors and the government. These consultants and lawyers forget that the main purpose of having capital and savings in your life is freedom. And having registered the best offshore trust in the world and the best offshore company in the world you do not want to become a slave and a hostage of your assets, do you?

Do not let your assets become a heavy burden!

It is possible that you think that money and capital (you honestly earned it) will not be a burden for you. Unfortunately, this happened to some of my clients. Instead of becoming a means to achieve freedom, their money became a burden for them. The source of stress. These clients cannot enjoy their family holiday without checking the value of their portfolio hourly. These customers are concerned about the election results. They wonder and worry about “what will happen next?”. They carefully read the news and with them absorb stress. As a result, the client has a panic and a mediocre picture with “vanity vanities” before his eyes.

I have already explained that it is important to see the big picture and the big picture and see your little picture (imagine it as a family photo), but absorbing the news and worrying about what happens around the world every day is bad for the psyche and health. And in the end – bad for your capital. You can learn more about the idea of ​​a big and small picture in the following article:

The accurate and correct answer to the question of the collapse or prosperity of the euro!

Instead of news, concentrate better on things that are important in life. Yes, you need a good asset protection strategy. Yes, you need to diversify your capital geographically and at least open a personal account in an offshore or foreign bank.

Yes, you need to double-check your chosen capital protection strategy about once a year with a specialist. It is very important that your chosen capital protection strategy is pro-active, not reactive. This will give you control. Independently conduct research and listen to the advice of professionals (from different sources, if you think that this is necessary). Dot all “i” and forget about your asset protection strategy for at least a year.

Mixing offshore and onshore

Mixing offshore and onshore

This week in my practice I have come across some things that I think will interest you. 
Yesterday I met with one private banker, who is now about thirty, with a big tail. When I met him a few years ago – he worked in the offshore sector – as a private banker in an offshore bank. Now he has gone to work at an onshore bank and works at a bank in one of the largest countries of the European Union. It is noteworthy that it is aimed at absolutely the same client base, which was aimed at working in an offshore bank. According to this former offshore private banker, and now an onshore private banker, to go from offshore banking to onshore was the only logical decision for him. Tax havens and banks, which are constantly being attacked from the press. As a result, many customers from developed countries are simply afraid to deal with offshore banks. Citizens of the United States and Europe are intimidated to such an extent that they do not want transactions to a bank in an offshore zone and transactions from a bank in an offshore zone to appear on their accounts at banks in their home country. Americans and Europeans do not want to declare offshore accounts, fearing to provoke an audit. Clients of offshore banks from Europe and the United States do not want to pay bills to accounts in offshore banks. By and large, the mass media in the western world have been brainwashed so much that they do not want to have anything to do with tax havens.

And where do all these people put their money? Where do people keep their money who don’t want to hear anything about offshore and tax havens? Of course, in onshore banks. Moreover, they choose and find such onshore banks, which in terms of the quality of investments and bank secrecy are not inferior to offshore, but have a much lower profile.

I’ll listen to your exclamations. In an onshore bank, the same level of banking secrecy as in an offshore bank? Is it possible?

Yes, it is possible. For the future and next year, the following strategy may be the ideal strategy:

Offshore company + bank account in Onshore + address to receive correspondent onshore.

For a typical average client, this structure will look like a fully onshore company. An onshore bank will register the owner of such an account as a non-resident and deposits in such an account as foreign deposits. The account holder will be a resident of a tax haven and, therefore, exempt from the exchange of tax information.

Having the structure “Offshore company + bank account in Onshore + address for receiving correspondence in Onshore” you can open a Paypal account and issue invoices with an onshore address. In my future articles, I will talk about many things that can still be done with offshore-onshore schemes and for which such schemes are ideal. Therefore, be sure to follow new articles – subscribe to the newsletter and put “I like” on our Facebook page.

For my readers, I have already prepared a surprise – Nevis LLC + Account in Switzerland + the address in Switzerland for opening a Paypal account and for representative activities.

I just want to warn you that there is only one important thing that you cannot do with an offshore company (even if a bank account for such a company is opened in an onshore bank). You cannot take advantage of double tax treaties. But there is also a solution – an onshore holding company, which is owned by an offshore company.

I already wrote about this method (an onshore holding with an owner – an offshore company) earlier, in connection with Cyprus and Malta. But in the European Union, there is a much lower profile country with an excellent network of signed double tax treaties. And very soon I will write about this opportunity.

Mass Closures of Non-Resident Bank Accounts in Hong Kong

Another important event for the offshore business that I want to talk about is the news about HSBC in Hong Kong, which closes huge amounts of accounts that have been opened for offshore companies. This is big news for those of you who viewed Hong Kong as a banking haven.

I already wrote earlier that I do not consider Hong Kong to be a really good place to register a company. The exception is a business with China or a business directly in Hong Kong. My previous advice was to register Nevis LLC and open a foreign bank account in Hong Kong (which essentially corresponds to the scheme “Offshore company + bank account in Onshore + address for receiving correspondence in Onshore” described above, if Hong Kong is considered an onshore part).

This strategy, recommended by me just three months ago, no longer works with HSBC. They are no longer willing or able to conduct documentary work with accounts of offshore companies, with the exception of working with large clients. Naturally, such news was to be expected after 
HSBC in Singapore began charging a fee of $ 2,000 for verifying documents for opening bank accounts for foreign companies. However, Singapore’s advantage is that there are a lot of banks other than HSBC that are willing to work with non-residents and offshore companies, while Hong Kong, apart from HSBC (and Hang Sheng Bank, which HSBC owns), has no more banks that are active in dealing with non-residents. Therefore, I can no longer recommend Hong Kong as an offshore banking jurisdiction for opening corporate foreign bank accounts to offshore companies. Nevertheless, I will closely monitor the banks in Hong Kong, and when banks appear in Hong Kong that are ready to work professionally with non-residents, I will definitely inform you. Do not miss the news and follow the subscription.

Asset protection – protection for prudent, not just rich

There is a misconception that the diversification of assets, especially the international diversification of capital, is worth doing only to very wealthy people. Even millionaires sin with the thought that asset diversification is only for multimillionaires and billionaires. However, the truth is that diversification is necessary not for a rich person, but for a reasonable person, regardless of the size of his condition.

When it comes to capital diversification, one gets the impression that people always believe that this concerns someone else: “This is not available to me” or “Not necessary.” And after 5 minutes they swear at the government, bankers, and corporations, which raise taxes, prices and reduce the quality of services.

Why do we need diversification? How can protect your assets? How to use it for your own benefit? About this all – below.

Capital diversification: Why diversification?

Greece, 2015 Crowds of people stand in a long line at a bank or ATM. Some of them need to pay for an apartment. Someone – for gasoline. And someone just wants to eat. As soon as the card goes to the ATM, they learn that, despite the number of funds in the account, today they can only withdraw 70 euros.

Nothing remains but to withdraw these 70 euros and get the wishes of a good day. But today is not as bad as tomorrow: the ATM ran out of money and no one knows when they will deliver the next batch of cash. Banks just closed the door and did not respond to calls.

What to do? How to live?

A similar situation was in Cyprus in 2013. But there is even worse because the funds are not just frozen, but also “trimmed” by taking a tax on large deposits. The same situation will easily develop in any European bank since Europe has officially adopted the “haircut deposits” for the official policy in the banking crisis.

And for the “enlightened Europe” repeat other countries.

Therefore, there are enough reasons to diversify, and these reasons concern not only wealthy people with billions of dollars but also an ordinary rational person who is responsible for his own life. It is easy to blame the government for short-sighted policy, but food, gasoline, and security do not give such accusations.

Capital diversification allows to level risks, relieve tension in crisis situations, to provide a zone of comfort and safety.

Even a small child can diversify, who does not immediately eat up all the candies, but puts a couple of pieces at the end of the week to eat while watching cartoons. Can diversify a teenager who invests part of the pocket money in the bank or in the resale of ballpoint pens. Can diversify the business owner who accumulates the profits of his company or dividends in the Bank of Singapore.

Diversification works on two fronts at once: it acts as insurance for an unforeseen event (crisis, unrest, unemployment, etc.), and as a new field for investment, growth and wealth (there are so many opportunities in the world that cannot be heard home country by people).

Capital diversification: varieties

Diversification can be different: it can be local when you put your assets in different banks, and you hide part of the funds in the form of cash under a pillow.

It can be international and then you open accounts abroad. Depending on the size of your capital and goals, your foreign bank account is located in Singapore, Hong Kong, Germany or Switzerland.

It may be different types of capital: deposit, cash, gold, shares of companies.

Let’s look at what each type of diversification gives and what it makes sense to count on in case of a crisis.

Diversification in one country. If you decide that it is better to keep deposits in 3 banks than in one – you are right. Moreover, different banks have different reliability and different interest on deposits.

However, there is only one problem: if the country is affected by a serious banking crisis, then not one bank will become a guarantee of security. It’s like in Cyprus or in Greece: regardless of the amount of capital, bank holidays are introduced for everyone. Ordinary people suffered.

International diversification. If you open 2-3 foreign accounts, then you are already making more sense. At the same time, we will again make a reservation that it is better than the accounts be not only in different banks but in different countries and even regions. If the collapse happens in Europe, and your account in Germany, despite the strength of the economy of this country, is a great chance to suffer.

This option for the price and feasibility is very attractive. To open a foreign account you usually need from 100-200 euros. True, if you want an account in Switzerland, then count on much larger costs and a minimum deposit. But there is a choice.

It is important to supplement one more thing: each account must be opened for some purpose. If your goal is to accumulate, then one option will do; if you achieve the maximum anonymity available in the modern world, then the other. And this also affects the price and the minimum volume of deposits.

Diversification between different types of assets. The classic deposit has its limitations. Today, these are low-interest rates (in some cases zero or negative), the problem of inflation, and currency risks. Therefore, it is worth thinking about the choice of assets themselves.

Of course, the first thing that comes to mind is cash. And this is an absolutely reasonable and logical step. Experts, from financial to those involved in extreme survival in the post-apocalypse era, talk about the necessary cash pool. Funds for 3-6 months of ordinary life is enough to survive the most acute moments of the crisis or just take a plane ticket for the whole family and get away.

Where to store? Under the pillow (not very safe), in the safe (costs, you need a good safe, but very convenient), in a safe deposit box (convenient, moderately safe), in a private vault abroad (very safe, but it is not convenient). Consider this: in some banks in the United States have already banned the storage of cash in a bank cell (except for numismatic values). In addition, if you keep in a regular bank in your home country, in the event of a crisis, the cells can also freeze along with deposits.

Therefore, the most reasonable is the stock of cash at home in a safe and in a store outside the country. Just in case.

German banks are recommended to keep cash reserves

If we talk about long-term diversification, then a reasonable contribution is gold and silver. Precious metals with a 5000-year history have not failed yet, and even today they continue to be popular. Metals are also best kept in storage – our colleagues offer a choice of place in Switzerland, Singapore, and Hong Kong.

Also, assets can be investments in securities and companies. It is worth saying only that we are not talking about speculative transactions aimed at increasing the securities themselves, but at long-term returns in the form of cash flow, which will be independent of the state of the economy — insurance and income.

Capital diversification: expanding strategy

However, there is another misconception that affects diversification, they say, only money and their derivatives can be diversified.

In your opinion, only savings in the bank are your assets? Of course no!

Among other assets that are equally important for a healthy and thinking in advance person, it is worth remembering family, work/work, professional and friendly relations, freedom of movement, freedom of choice. It is they and the conscious application of these resources not only contribute to the subjective feeling of wealth but also happiness.

However, how can you diversify your family, you ask? Of course, we are not talking about polygamy or the creation of several families around the globe. We say that you and your family always have the opportunity to be where it is safe.

What tools are there for this? In part, these are the same assets that, in the form of money, you previously transferred to reliable banks and jurisdictions. But money is not always able to withstand social, political and even economic crises. Need something else.

Powerful additions are permits to reside in another country: a residence permit, permanent residence or even citizenship. The fact is that being a forced migrant, a refugee, it is difficult to obtain proper status, and in comfortable conditions. Even among the refugees from the Middle East that swept Europe, there are very wealthy individuals who did not think in advance about obtaining status in the EU or another part of the world. And now they have to wait for their turn in the camps and other not very pleasant places.

A prearranged site will ensure the diversification of such risks. Well, if you never need it, as insurance. But it will serve as an excellent addition to the freedom of movement, choice, education, and recreation.

A little separately here is obtaining a second citizenship. The second passport is one of the most valuable tools of freedom. Just think – only in the sense of travel without visas, the second passport can offer 50-100 new countries to visit. And this, if you do not remember about the acute crisis situations when you just need to sit down and go to a safe place.

The second passports have one serious problem: getting them is a long process. Naturalization requires at best 3 years but more often takes from 5 to 10 years. And at this time it is necessary to constantly reside in the territory of another state. Someone this option is interesting, but certainly not actively moving entrepreneurs, managers, and just travelers.

But the benefits of a second passport beckon. Is there an alternative?

Oddly enough – yes. This is called the “second passport for investment.” In this situation, you invest a given amount in the country’s economy (fund, real estate, business), and in return, you get a passport. Legal, valid, respected passport of another state.

Grenada Second Citizenship for Seaside and Orchard Cottages at Levera Beach Resort – numbers, facts, and advice

The deadline for such passports depends on the state and ranges from 3 months to 1 year. Cost – from the available $ 100,000 per person (Dominica) to 1-2 million euros (Malta, Cyprus).

We invest in the second citizenship of Malta and learn to fly

During the procedure, the applicant and his family will be checked and, if everything is in order, a passport will be issued. Often, even to come to a new country is not necessary.

And the family diversifies part of their risks with the help of a second passport.