APGI - Why Offshore

Why Go Offshore? It may save your financial life!!!

For those who are concerned or apprehensive about "going offshore" for asset protection, investments or even for business, it may be helpful to remember that risk is relative. Jumping out of a two-story window is certainly high on the risk scale, but if the building is on fire and you can't get out any other way, the two-story jump is a lot less risky than staying where you are.

Before discussing some of the ways in which you can reduce the risk of losing your assets by moving them offshore, let's look at some of the alternatives and the reasons why an increasing number of people in the US and Europe are moving some of their assets offshore.

There is a rancorous debate going on between those who believe there is "no place like home" (the USA) and those who believe the USA is rapidly becoming a police state in which our traditional liberties are being circumvented by a host of Machiavellian laws. The USA does continue to offer many economic and personal benefits not readily available in other countries. The US still has the largest economy in the world with substantial freedom to choose what kind of work one's wishes to do. There is great freedom of movement within the borders of the US and citizens are not burdened by a multiplicity of languages. While the mass media seems to have an enormous bias toward socialist policies, it is still possible to write and publish information critical of the government and its policies. Despite the many complaints about the current medical system in the US, it still offers more choice and access to care than many other medical care systems in the major countries of the world.

But there are cancers growing in the political institutions and many fear that these are irreversible. One is the so-called "war on drugs" which led to the creation of a curious felony known as money laundering. While this law was created on the pretext that it would hurt the drug dealers, it's become a trap for people who have no ties to any form of criminal activity. Another casualty of the war on drugs is the right to be secure in the possession of our property, which is ostensibly protected by the Fourth Amendment to the Constitution. With no legal proof, nearly any government agent or police officer can accuse you of some crime and then proceed to confiscate any property you have that is remotely connected with the alleged crime. Abuses of the asset forfeiture laws are becoming legendary. The recent reform law that was intended to curtail these abuses is not expected to have much impact. In many federal agencies, states, counties and cities, revenues from forfeitures are assumed to be available as a substitute for budgeting the funds to pay for the law enforcement efforts. Thus, the law enforcement personnel are forced to create opportunities for forfeitures in order to meet their budgets.

The US has recently passed a unique milestone according to the Financial Freedom Report. It seems that the US now has more people in prison per 1,000 citizens than any other country in the world. A high percentage of our prison inmates are there for crimes that do not involve harm to others or any kind of theft or fraud. They are there because their behavior is not consistent with politically accepted norms. The US has reached a point where it is virtually impossible for any resident of the USA to be totally innocent of every kind of crime because there are many thousands of crimes at every level of government and no one can be sure they have never violated any of them. For example, did you know it is a crime to carry any prescription drugs in any container other than the one provided by the pharmacy? This means that the elderly who need to remember which pill to take at certain hours or on certain days are breaking the law when they go to their neighborhood pharmacy and purchase a plastic pill organizer. Should they be arrested and tried for wanting to remember and organize their medication which often times is vital to their existence?

Those in the USA who are financially successful are not safe or secure in their possessions for many reasons -- including a burdensome level of taxation on the well to do. The top 10% of the income earners in the US pay more than 50% of the total individual income tax. The USA has become a country where those who work and save are not allowed to keep most of what they have earned. The mass media and many politicians rail against tax policies that "favor the rich" -- which really means that the successful members of society can't keep what they have produced and saved. Many of the alleged "tax-cuts" for the rich are passed into law by the rich themselves. How many of the Senators or Representatives in the US government come from low income, average middle class, or poor families?

Those who are thinking of leaving the USA for more hospitable countries will want to have some assets offshore before they are ready to take that step. Often times this is an unattainable goal for those who want to become expatriates due to the financial, cultural, and language issues involved. Therefore we have dedicated many man hours and funds towards making offshore services and asset protection available for everyone. Offshore structures and banking accounts are not services which are only available to on the millionaire who lives in a castle on the hill. This is a thing of the past. APGI has made offshore structuring and asset protection a reality for the average individual or small mom and pop company.

Perhaps the best reason to have some assets offshore is the possibility that the USA will establish currency controls and will prohibit citizens from taking any assets out of the country. If that were to happen, your future may be limited to the controls set by the US government on your money. So you have worked hard to earn your money, you have paid a hefty tax on your earnings, insurance, bills and you will no longer have control of your money.

And -- there are other benefits in having some assets offshore.

Access to Foreign Investments:

While there are an abundance of investment opportunities in the USA, they are not necessarily the best investments for every investor. There are many investment choices only available outside the USA. Some of the top mutual fund managers in the world have formed investment funds outside the USA that are not available to the US investor. Many of these foreign funds are even managed by US fund managers.

Financial Investment Diversification:

For maximum profits there is an adage that you should "Put all your eggs in one basket, and then watch that basket closely." This is fine for those who are able to spend all of their time staying on top of their investments, but it poses great risk for those who are still working and unable to devote all of their time to "watching their investment basket." The alternative is a risk avoidance method of investing. It's simply an organized system of diversification to mitigate different kinds of risks. The main kind of investment risk is the risk of not being able to cash in your investments at full value at any time. This risk is minimized or avoided by investing in low yield and liquid forms of savings like money market funds, savings accounts, short-term certificates of deposit and short-term government securities. However, those investments are subject to a loss of purchasing power due to inflation and the income they produce is heavily taxed. Common stocks, real estate and natural resource investments tend to provide the best protection against inflation and they offer some tax deferral, but they are exposed to the risk of a deflationary economy.

There are in fact many different kinds of risk besides the most often discussed risk of not being able to get full value at any time. A diversified investment portfolio would include investments in different industries, in different countries and even in different currencies. While you can obtain investments in different currencies and countries through US sources, having some investments outside a single political jurisdiction would be another form of diversification from a different kind of risk.

Global Trade Opportunities:

It's become a cliché' to say "The world is getting smaller", but cliché's become cliché's because they are abundantly true. If you want to do business outside the US, there will be occasions when you need to have some financial assets outside the US. That may be all the reason you need to "go offshore".

Safer Banks & Insurance Companies:

The "free" government "insurance" for US savings and checking accounts isn't free and isn't insurance. Real insurance involves a fund of assets that are based on the statistical likelihood that some event may occur. The premiums paid by all of the policyholder are based on the averages of the payments to some of the policyholders. Thus, if one out of 1,000 policyholders is likely to incur a loss of $100,000, then each of the policyholders would have to pay $100 to cover their statistical share of that loss. And, insurance companies don't insure people who are likely to have a claim. That's why you have to have a physical exam for life or health insurance. You can't get flood insurance if you insist in living on a flood plane - unless it's government "insurance".

With government "insurance" there is no study of the average losses. Instead, when a loss event occurs, it's paid for from the general funds of government -- which come from tax revenues. Thus, there is no visible cost to each of those who are "insured" because it's buried in the total tax bill. Nor is there any way for the taxpayers to know how much this "insurance" is costing them. Thus, government "insurance" is never based on any rational analysis of costs and benefits. A good argument can be made that government insurance for savings and checking deposits force bankers to be more aggressive than they would be without the "insurance". S&Ls and banks compete with each other to offer investors the highest possible returns on their savings. To the extent that the depositors are protected by government insurance, the individual banks and S&Ls are freed form the discipline to be conservative in investing the money entrusted to them. This encourages more risky kinds of investing -- such as buying long term bonds with funds that were derived from short-term deposits. A few years ago, some of the S&L managers were using their deposits to invest in high risk "junk bonds" or in speculative derivative and option investments.

Many of the leading international (non US) banks and insurance companies are far more conservative and less susceptible to failure than their US counterparts -- because they don't have the illusion of government backed insurance to protect their depositors. The US banking system is far more leveraged than many foreign banking systems because of the federal insurance programs. While depositors will be protected in the event of a few isolated failures, there is a much greater risk that the efforts of US banks to attract deposits with high interest rates based on speculative investing could cause the entire system to collapse.

It would be prudent for a conservative investor to have some funds outside the US banking system.

The U.S. Litigation Epidemic:

One of the major reasons for the flight of huge amounts of assets outside the US is the run-a-way litigation and the huge awards that are being granted by US juries and judges. One publication recently commented that the US has more than 90% of the lawyers in the world and less than 10% of the world population. The US is the only country in the world that permits lawyers to work on a contingent fee basis and to collect huge fees from punitive damage awards.

Every law that confers a "right" on one segment of the population also imposes a duty on everyone else to subsidize that right. Family medical leave is an excellent example. The government passes a law requiring employers to grant extended leave for new mothers and to make their job available to them many months later. The laws that provide accessibility and accommodations to the disabled are another example. The cost is paid by businesses that provide services to the public. The civil rights laws attempt to remedy discrimination in the US, but the bill is paid by businesses and employers who are alleged to be in violation of the law. The employer initially pays for the costs of compliance with all these and other laws. In addition, whenever an employer is accused of violating any one of the hundreds (thousands?) of laws, a lawyer is usually close at hand to sue the employer for damages to the employee.

Anyone who owns real property is subject to an incomprehensible assortment of laws that protect various species of animals, birds, and even insects. For a detailed discussion of the growth of laws in the US, APGI encourages you to read, The Death of Common Sense, by Philip K. Howard.

All of these laws give someone the right to sue you for failing to comply with the laws.

To add insult to injury, the US courts and juries have become the most generous in the world in awarding damages to plaintiffs who sue for recovery under these varied laws. The judges and the juries are sympathetic to the claims of the plaintiff and look for someone to pay for the damages. Where there are multiple defendants, the one with the most money usually gets to pay the bill even if that person or company had very little involvement in causing the injury. Because of the great risk of large judgments in US courts, the insurance companies badger their customers to settle to avoid a trial. This in turn encourages opportunistic lawyers and plaintiffs to look for some way to sue anyone with insurance. How do they know that you have insurance? If you have visible assets it's likely that you have some insurance to protect those assets. However, in some professions or businesses, the cost of malpractice or product liability insurance is so prohibitive that the professional or manufacturer must "go bare" or go out of business.

Growing Loss of Financial Privacy:

The US has become a financially transparent society. Anyone who is interested in your financial condition can quickly find out what's in your credit records, your real estate holdings, your business interests and your investments -- often for less than $99. With the Internet, anyone who wants to invest some time can get most of this information for a lot less than $99. This is a small amount for a potential plaintiff to pay when the potential for a large settlement or judgment in his or her favor may be granted. Government agencies regularly monitor most of the mobile phone transmissions, email, wire transfers and other electronic communications looking for a pattern of messages that might suggest there is some drug or other criminal activity being discussed. The serious criminals are aware of this and take steps to protect their communications from prying ears. So it's often the unsuspecting individual who gets investigated because of some innocent comments made electronically. The police or DEA come rushing in and promptly seize everything in sight.

The Magnet of Power:

"Power corrupts and absolute power corrupts absolutely" - Historian Lord Acton (1834-1902)

The founding fathers of the USA attempted to create a system of checks and balances so that government would not become an adversary of the people. But individuals with political power frequently don't like the boundaries the Constitution imposes on their power. Over the last two centuries, they have hashed away at the restrictions. In 1913, a large group of advocate voters convinced the rest of the voters that we should adopt an income tax system in order to make those rich capitalists in the Northeast pay their "fair share" of the taxes. The income tax was sold on the promise that it would only apply to the very rich and that poor or average income citizens would by no means be subject to the income tax. That amendment to the US Constitution opened the door to a flagrant disregard of the system of checks and balances in the Constitution. The income tax system imposes "civil laws" in blatant defiance of many provisions of the Constitution that were ratified in order to protect the public from disproportionate taxation.

Why does anyone seek to spend hundreds of thousands or millions of dollars to become an elected Representative or Senator (or President) when those "jobs" pay a salary that is a mere portion of the cost of getting elected? The supporters of the candidates pay for the cost of getting elected and these big contributors expect to get big benefits at the expense of someone else as usual. Often times the little contributors and campaign workers often want someone in power to pursue a single issue like environmental laws, laws for the disabled, laws that favor the elderly and other laws that grant benefits to the supporters at the expense of the supporters of the candidates who lost the election.

The US has become a cannibalistic society in which people compete in the political arena for the power to impose their political policies on others. It has been said that those who mind their own business, work hard and are thrifty eventually find themselves as the meal ticket for those who find politics to be more fun and less work. Some of the individuals who have amassed some assets are beginning to set aside a "stash" or a nest-egg offshore where it will be safe from the politically connected vermin in the USA.

For a very detailed discussion of this process in the form of a novel, we encourage you to read, Atlas Shrugged by Ayn Rand. While it was written in the fifties, it has become an insight into the direction of the US political system.

Another Reason To Have Some Cash Offshore

Here's a copy of an email advertisement that one of our employees received explaining how this company can locate bank accounts of debtors in spite of the alleged new banking privacy rules in Senate Bill S 900. Forget about saving taxes offshore. If you don't want potential plaintiffs to quickly and easily find out how much money you have in your bank accounts, then you don't want to have all your bank accounts in the U.S. where these people can find them.

Bank Asset Searches Are Back -- using new search techniques that are in full compliance with new federal legislation (Senate S.900) -- Recent federal legislation restricted the manner in which certain asset searches could be conducted, especially those relating to "liquid assets", such as bank accounts, investment accounts, etc. With more than ten years of experience in the asset search field, our investigators have developed new search techniques and procedures that are in full compliance with current federal and state financial privacy laws. We can once again provide our well- known Enhanced Bank search and Investment Account search using these new techniques. Our seasoned asset searchers have been instrumental in identifying more than $2 billion of debtor assets. Our well-known "no-hit/no charge" Bank Account Locator search has been instrumental in locating millions (and millions!) of dollars of debtor assets, and it's still priced at just $125. Our basic asset search packages, such as our Level 2A (conducted on an individual) and our Level 2C (conducted on a business entity) are priced at just $325. To obtain our catalog of asset searches, please contact us at 800/675-6636."

Protect Your Assets From Predatory Lawsuits !

If you have any type of net worth be it positive or negative and live in the U.S., Canada, or Europe you are at risk for being sued by opportunistic lawyers working on a contingency fee for a predatory plaintiff. If just one lawsuit results in sympathy damages in excess of your insurance, you could be wiped out, your family assets could be lost, your employees could be out of work and your legitimate creditors won't be paid. You could also lose your assets because of the growing problem of civil forfeitures in the U.S. That's why you need a nest egg of assets outside the U.S., Canada, or Europe.

If you would like further information or would like begin structuring your personalized offshore protection plan please feel free to contact us . ***All correspondence is confidential. Link to the contact page.