Offshore Internet Banking Pros and Cons
An offshore bank is a financial establishment located in a remote foreign location. It you live in the United States any bank that is not on American soil is an offshore depository. You can set up an offshore banking account in any jurisdiction that has favorable taxes and no legal limits. Often offshore banks are chosen for privacy and secrecy of banking activities. Offshore internet banking does need to include remote deposits of funds as well as direct deposits. ACH wire transfer and electronic fund transfers are highly important. You may also require administrative services, offshore trading accounts, and foreign currency exchange capabilities. You may also want an offshore debit card to access offshore internet banking activities.
To ensure that you have the best offshore banking experience, let the banking institution know what type of offshore services you will need. Are you a consumer or a commercial customer? The retail consumer or the average individual can be one type of customer and private banking meant for high net worth individuals or companies carries different banking situations.
The internet lists a group of common offshore banks that offer internet savings accounts, offshore internet banking, and safety. This list includes banks in Singapore, Malaysia, Cook Islands and Antigua. You can also find high end banking concerns in New Zealand, Luxembourg, the Bahamas and Monaco. Hong Kong is high utilized as is Malta and Macau. Although movies and novels depict the Cayman Islands and Caribbean Islands as offshore banks that are highly considered, these are not the best offshore banks to consider.
Offshore internet banking concerns are highly regulated and more regulations are being considered. The International Monetary Fund requires financial institutions to maintain high performance standards in terms of capital adequacy and liquidly and to report activities to the FCIC. Offshore banks are required to immediately report suspicious activities resembling money laundering, report businesses and individuals who have high holdings and benefit from interest income in their banks, and to allow the US Government to seize all assets of a financial institution if that bank holds assets of a known criminal.
Depending on the offshore banking institution you are working with you may find that highest interest savings accounts are available if you have the designated amount of funds deposited in the bank. These savings accounts can be much higher than US based banks, but again, the interest does have to be reported to the IRS and the U.S. Treasury Department.
It is not illegal to conduct offshore internet banking, but such activities carry legal implications that you must comply with. There are severe fines, penalties and legal problems if you fail to comply with requirements. Just establishing an offshore banking account can be a reason for the U.S. government to pay attention to your activities. Traditionally offshore banking has been used as a mechanism to conduct illegal activities, hide taxes, and have secret business dealings.
Conducting banking on line through an offshore bank can be a bit confusing and you do run the risk of government shutdowns, poor connections services and no consistency to deposit timelines. You can also be exposed to the risk of network scams, intrusions and breaches. Private and sensitive information can leak into the wrong hands, and you will find that more spam mail from foreign concerns will arrive in your inbox. To find the best online banking in an offshore setting, make sure the bank is reputable and possibly tied to an onshore bank.