Offshore tax havens offer an adequate level of confidentiality, but e-business entrepreneurs should be aware that confidentiality does not equal absolute secrecy. Offshore jurisdictions’ confidentiality has been severely curtailed in for various reasons, including threats of global terrorism and money laundering. It has now become impossible to avoid the risk of potential disclosure when opening an offshore bank account.
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The convergence of recent events involving offshore banks, tax haven jurisdictions, terrorism and concerns over financial transparency, has made it extremely risky to rely on offshore bank secrecy to avoid disclosure of offshore financial information. Several global initiatives are having a decisive influence on the extent of offshore banking confidentiality. In particular, the concerted actions of the Organization for Economic Cooperation and Development (“ OECD”) and the Financial Action Task Force (“FATF”) are aimed at promoting transparency in the banking industry. In the US, e-businesses should also be aware of certain provisions of the Patriot Act of 2001, which was passed after September 11.
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Alain Megias, IBLS