Anonymity / Bank Secrecy / UBO. Best jurisdiction to protect your id.

[kefth]

Hi,


I currently own a Holding company in Cyprus (non-resident). A have appointed nominee Shareholder and Directors. I am the sole signatory of the company's bank account.


I would be grateful if you can help me with the following questions:


- How much protection does the current scheme really provides in terms of anonymity?


- Is it possible for the nominee Shareholder to be forced to reveal the id of the beneficial owner?


- Whilst the Nominee shareholder may offer some protection, the beneficial owner is in fact vulnerable at the Bank. Any investigating body can apply to the Cyprus High Court for a court ”˜production order'. Is it possible for a foreign Tax authority to obtain a "court order" forcing the Bank to provide information on the beneficial owner of the Company and its Bank account?


- Will a Seychelles IBC (owing the Cypriot Company) offer any advantageous in terms of anonymity (revealing the id of the beneficial owner - bank secrecy)?


Thanks in advance for all your help.

 

[JohnLocke]

Whilst the Nominee shareholder may offer some protection, the beneficial owner is in fact vulnerable at the Bank. Any investigating body can apply to the Cyprus High Court for a court ”˜production order'.
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Not really as long as we speak Cyprus. Actually you are protected by the banking secrecy that Cyprus still maintain and that prohibit the bank to exchange any information without local court order, this also set's beside any TIA's or DTAA etc.

- Will a Seychelles IBC (owing the Cypriot Company) offer any advantageous in terms of anonymity (revealing the id of the beneficial owner - bank secrecy)?
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It add an additional layer of privacy protection since it isn't possible to trace down the UBO of an Seychelles IBC, again this would require a local court order in the Seychelles.

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[hugger]

kefth said:
Hi,
I currently own a Holding company in Cyprus (non-resident). A have appointed nominee Shareholder and Directors. I am the sole signatory of the company's bank account.


.
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I am curious about this. Are you a Director of the company? (If so, then you can easily be found by the tax authorities)


If you are not a Director, how did you open the bank account ?


And how can you be a sole signatory if you are not a Director?

 

[kefth]

Thanks Admin for your prompt reply.


What do you exactly mean "this also set's beside any TIA's or DTAA etc."?


There are definitely less international tax agreements signed by Seychelles compared to Cyprus (exchange of info re Tax).


If there is in force a TIA or DTTA between Cyprus and the Foreign Tax Authority, does that mean that the bank secrecy can be lifted automatically by the foreign authority directly or indirectly via the Cypriot competent authority, in order to get more info re the UBO?


Will it be more difficult for a foreign tax authority to get a "local court order" in Seychelles compared to Cyprus to lift bank secrecy (especially in the absence of a DTAA)?


I have read that "bearer shares" in Seychelles companies can be used to obtain 100% anonymity. However, I have also read about the associated problems opening a bank account with bearer shares (no EU based bank accepts them any more). What is your opinion about that? Are bearer shares still an option or they are being sited by old and not up-to-date websites?


Thanks again for all your help.

Last edited by a moderator: Mar 16, 2012

 

[kefth]

hugger said:
I am curious about this. Are you a Director of the company? (If so, then you can easily be found by the tax authorities)
If you are not a Director, how did you open the bank account ?


And how can you be a sole signatory if you are not a Director?
Click to expand...

I am not a director of the Cypriot company. The Board of the directors gives instructions to the bank re the opening of the account. As far as I know, anybody can be assigned as the signatory.

 

[tax-haven]

I am curious about this. Are you a Director of the company? (If so, then you can easily be found by the tax authorities)
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Do you actually read OP ? He has appointed nominees 😉 So if the CSP's is reliable and has many years of good reputation in Cyprus I would not worry. I would do worry if the CSP is new and unknown to the Cyp. Authorities since it can bring lot's of troubles to the light:w:

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[tax-haven]

If there is in force a TIA or DTTA between Cyprus and the Foreign Tax Authority, does that mean that the bank secrecy can be lifted automatically by the foreign authority directly or indirectly via the Cypriot competent authority, in order to get more info re the UBO?
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Only if it can be proven that you are into Money Laundering, Financing of Terrorism etc. it may be possible to gain a court order. This has happend, sure, but only a handful times. It is way difficult to get such an court order so if you don't push figures in the million range through your account I wouldn't worry. If you stick behind the border line you are safe.


You need to play this game right. Governments today all over the world want you to believe that you can't hide you anywhere any longer. True, but you can escape to pay tax and you are able to let money vanish if the amounts are not too high:angel:

Last edited by a moderator: Mar 16, 2012
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[hugger]

kefth said:
I am not a director of the Cypriot company. The Board of the directors gives instructions to the bank re the opening of the account. As far as I know, anybody can be assigned as the signatory.
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Thank you for your response.


How have you protected yourself from having the Board of Directors revoking the instructions assigning you as the sole signatory (and potentially installing themselves as the new signatories)?

 

[JohnLocke]

How have you protected yourself from having the Board of Directors revoking the instructions assigning you as the sole signatory (and potentially installing themselves as the new signatories)?
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Well, if someone is doing so, it is a crime and will be prosecuted by applicable laws. Further, the bank's wouldn't agree to the change just so, there is still a UBO. However, it is a great hypothetical question. If you have a big figure in assets, I would recommend you to fly to the destination, find a reputable law firm work out some legal documents get them cross checked by a local lawyer, that's the best protection you can gain for money. But can anyone protect us from the 3rd WorldWar?

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[hugger]

kefth said:
I am not a director of the Cypriot company. The Board of the directors gives instructions to the bank re the opening of the account. As far as I know, anybody can be assigned as the signatory.
Click to expand...

Hi kefth,


How have you protected yourself from having the Board of Directors revoking the instructions assigning you as the sole signatory (and potentially installing themselves as the new signatories)?


If you are using a nominee Directors, it must (at some time) become very tempting for the Director to access the assets in your account. (Even Bernie Madoff couldn't resist the temptation. He was pillaging the accounts for 40 years before the Financial Crisis brought him undone).


The temptation to a small time lawyer in some tax haven (acting as Nominee Director) to access a couple of clients offshore banking accounts must be hugely tempting.


Also, Prosecution would seem very unlikely , given the nature of the account, and the exposure from the legal case.


I am very interested in following what you have done, BUT I want to make sure that my assets and income flows into the accounts are protected.

 

[kefth]

hugger said:
Hi kefth,
How have you protected yourself from having the Board of Directors revoking the instructions assigning you as the sole signatory (and potentially installing themselves as the new signatories)?


If you are using a nominee Directors, it must (at some time) become very tempting for the Director to access the assets in your account. (Even Bernie Madoff couldn't resist the temptation. He was pillaging the accounts for 40 years before the Financial Crisis brought him undone).


The temptation to a small time lawyer in some tax haven (acting as Nominee Director) to access a couple of clients offshore banking accounts must be hugely tempting.


Also, Prosecution would seem very unlikely , given the nature of the account, and the exposure from the legal case.


I am very interested in following what you have done, BUT I want to make sure that my assets and income flows into the accounts are protected.
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Here is a simple tip for you. Once I transfer an interim dividend from the subsidiary to the Cyprus holding company and the money are in the bank account, then the same day I pay myself an interim dividend to my private account. After that I give an order to the Directors to do a dividend resolution dated 2 days ago.

 

[hugger]

kefth said:
Here is a simple tip for you. Once I transfer an interim dividend from the subsidiary to the Cyprus holding company and the money are in the bank account, then the same day I pay myself an interim dividend to my private account. After that I give an order to the Directors to do a dividend resolution dated 2 days ago.
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Hi kefth,


Thank you for your intelligent and rational response. I can now see how you are approaching the problem.


You are using the offshore banking account (which is attached to the Cyprus holding company) as a "transit" account, which you then transfer to a personal account.


I have been approaching the problem by wanting to use the offshore account as a final destination "asset holding" account.


Kefth, Can I ask two more questions:


1) Is the subsidiary account (which I assume all your clients pay into) in your home country?


2) Is your private account (which is your final asset-holding account) in your home country?


If the answer to 1) is yes, then are you concerned that paying all the funds from your subsidiary across into a Cyprus based company and offshore Bank account might be a "red flag" to your home tax authorities?


If the answer to 2) is yes, then are you concerned that receiving all your funds from a tax haven might be a "red flag" to your home tax authorities?


If the answer to 2) is no, then how is it possible to access the money in your home country.


Kefth, thanks again for your rational responses. I think you and I are travelling the same path with you being just a couple of steps in front of me.

Last edited by a moderator: Mar 16, 2012

 

[crosslink]

Can you help me to understand what this all means? I need my money out tax free from offshore company?

 

[kefth]

hugger said:
Hi kefth,
Thank you for your intelligent and rational response. I can now see how you are approaching the problem.


You are using the offshore banking account (which is attached to the Cyprus holding company) as a "transit" account, which you then transfer to a personal account.


I have been approaching the problem by wanting to use the offshore account as a final destination "asset holding" account.


Kefth, Can I ask two more questions:


1) Is the subsidiary account (which I assume all your clients pay into) in your home country?


2) Is your private account (which is your final asset-holding account) in your home country?


If the answer to 1) is yes, then are you concerned that paying all the funds from your subsidiary across into a Cyprus based company and offshore Bank account might be a "red flag" to your home tax authorities?


If the answer to 2) is yes, then are you concerned that receiving all your funds from a tax haven might be a "red flag" to your home tax authorities?


If the answer to 2) is no, then how is it possible to access the money in your home country.


Kefth, thanks again for your rational responses. I think you and I are travelling the same path with you being just a couple of steps in front of me.
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Hugger,


You need professional advise on tax. Every case is individual and you can't draw conclusions from other peoples' arrangements.


Hope that helps.

 

[crosslink]

kefth said:
Hugger,
You need professional advise on tax. Every case is individual and you can't draw conclusions from other peoples' arrangements.


Hope that helps.
Click to expand...

But it can help me to understand what direction I have to look at :=)