Private Offshore Bank

Swiss Private Banks and Confidential Banking

A private offshore bank is one owned by directors who have 100% liability. In terms of popularity, Swiss private banks are often the most sought after among private offshore banks and hold the reputation for combining absolute secrecy with shrewd financial policies. Not only is the private offshore bank more likely to pursue conservative financial policies and take less risks than a large commercial bank (since the bankers themselves will pay the penalty for mismanagement), personal liability among executives keeps the banks small by nature. Where larger banks may be multinational organisations with various banking arms and global operations, private banks tend to keep their operations in one country and aim for steady rather than exponential growth.

Do Private Banks Provide More Bank Secrecy Protection?

The term ''private offshore bank'' alludes to the idea that private banks offer their clients greater confidentiality. Smaller private banks are in fact more likely to benefit from bank secrecy provisions. This is because banks that keep their operations within the borders of one jurisdiction leave authorities from other countries no leverage with which to blackmail them. Global banks on the other hand with operations in high-tax countries like the US can be strong-armed into handing over information that should be guarded by banking secrecy. We have seen high-profile cases where even Swiss banks (bound to confidentiality by the Swiss Banking Act since 1934) have begun to hand over confidential records when they fear penalties will be imposed on their extensive US interests.

Numbered Bank Accounts and Other Ways to Protect Assets

While numbered accounts no longer exist - even private offshore banks have to identify every client, there are still various methods which bank clients can use to enhance privacy. Most will at some point or another look to bank secrecy for asset protection. In this respect, swiss offshore banks and cayman offshore banks have good reputations because of the secrecy laws in their respective jurisdictions. However, even the best intentions cannot stand up to sustained pressure from high-tax countries.

Offshore Entities Like The LLC, IBC and Offshore Trust

Another method used to conceal a financial identity from 3rd parties is through the use of offshore entities like limited offshore companies and trusts. Clients of a private offshore bank may incorporate an offshore company prior to account opening, using a company formation agent in a jurisdiction known for its secretive legislation. These secretive companies are often incorporated in tax havens, and may not reveal in any public reister the identity of company directors. The list of most confidential companies changes year by year in concert with geo-political movements, and whereas one year a BVI company may be regarded as ''ultra-private'', the next year it may be a different tax haven company, or even a place not commonly thought of as an ''offshore financial centre'' like the US!

Having set up the offshore company the client of a private offshore bank can then send and receive wires or have cards issued in the name of his/her offshore company or offshore trust. Even so, each offshore bank account must have a beneficial owner. Therefore, using an offshore company only shields financial transactions from outsiders, not from the bank itself.

Offshore Bank Alternatives

Even banking offshore with elaborate offshore structures is not enough to protect privacy if a foreign authority requests information and the offshore bank is forced to comply. As mentioned previously, this can easily happen where a multinational bank has operations in high-tax countries, or when the secrecy law itself is relaxed or reinterpreted.

For these reasons, Capital Conservator does not recommend relying on bank secrecy in any one country, or with any one bank. Instead, Capital Conservator utilizes multile financial services companies which operate independent of bank secrecy laws to protect customer confidentiality. In this way, even in a direct attack on banking secrecy or one of our banking partners, client records are kept secret.