Most offshore jurisdictions have fiercely strict privacy and confidentiality regulations established which help to ensure that the identities and transactions of individuals and, indeed, companies are carefully shielded and protected. Whilst this confidentiality is almost legendary, it is not possible to guarantee absolute privacy and anonymity. All offshore financial centres, just like onshore financial institutions, throughout the world have an implicit legal obligation to comply with investigations into suspected serious criminal activity such as money-laundering and, more recently, the funding of terrorism. This is the only time that OFC’s will impart information to a third party.
In the vast majority of offshore bank accounts and companies, where there is no compelling criminal or terrorism accusation, personal information including the details of the owner of the offshore account and transactional information are completely shielded. These OFC’s are designed to provide complete confidentiality and serve to totally protect and safeguard individual and company information. This, the highest level of confidentiality available anywhere in the world, is especially worthy of note as it relates to protecting assets from legal action within the home jurisdiction and civil matters such as divorce or inheritance matters. The only time that an offshore bank will divulge even the slightest amount of information will be when they are compelled to by a foreign government IF certain rigorous standards and tests have been met by the governmental body.
This would be in the case of substantial evidence in a money laundering or terrorism case. The overseas banks do everything in their power to protect the identity and information surrounding the accounts they hold as their primary concern is safeguarding their investors. It is in the interest of these offshore financial centres to ensure that no leaks or breaks in confidentiality occur as it would completely shatter the confidence of other offshore account holders and investors. Along with losing face, they would stand to lose millions of pounds worth of business.
Other offshore vehicles and entities provide an even deeper and tighter level of anonymity and confidentiality. These include the International Business Company (the IBC) or Offshore trusts, although these are more complicated to set up and run than simply opening an offshore bank account.
Although anyone can open an offshore bank account, the objective should be to address the need of, and to strike the appropriate balance between, effective asset protection, reduced taxation, complete anonymity, security of transactions and accessibility.
