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So does this mean Bearer Deposit Notes[1] are illegal? [1]: https://www.tdsecurities.com/tds/pdfs/Manulife_Bank.pdf https://www.tdsecurities.com/tds/pdfs/Manul

So does this mean Bearer Deposit Notes[1] are illegal? [1]: https://www.tdsecurities.com/tds/pdfs/Manulife_Bank.pdf https://www.tdsecurities.com/tds/pdfs/Manulife_Bank.pdf

JumpCrisscross 9y ago
Bearer bonds [1] are intriguing, mechanically and historically. You will note, under the Restrictions section of your Manulife memorandum [2], that its sale outside Canada or to Americans is prohibited. This is because the issuance of such instruments was practically banned in the United States in 1982 [3]. Bearer instruments are, while prevalent, in decline [4]. It is an active area of global financial regulation [5] where even institutions like the Bank of England have to work to get their notes issued and treated properly. TL; DR A reputable offshore bank might be able to issue a bearer token redeemable for one British pound or Canadian dollar provided they go to great extents to ensure they don't end up in the hands of Americans or anyone in the United States. It would be an uphill battle, however, which in turn necessitates a heavy issuance premium. [1] https://en.wikipedia.org/wiki/Bearer_bond https://en.wikipedia.org/wiki/Bearer_bond [2] https://www.tdsecurities.com/tds/pdfs/Manulife_Bank.pdf https://www.tdsecurities.com/tds/pdfs/Manulife_Bank.pdf [3] https://www.investopedia.com/articles/bonds/08/bearer-bond.asp https://www.investopedia.com/articles/bonds/08/bearer-bond.a... [4] https://ftalphaville.ft.com/2016/04/04/2158236/so-you-thought-bearer-securities-werent-a-thing-anymore/ https://ftalphaville.ft.com/2016/04/04/2158236/so-you-though... [5] http://www.fatf-gafi.org/media/fatf/documents/reports/ML%20and%20TF%20in%20the%20Securities%20Sector.pdf http://www.fatf-gafi.org/media/fatf/documents/reports/ML%20a...
- bradleyjg 9y ago
  I looked into the law that banned bearer bonds, TEFRA, and I think maybe the relevant provisions wouldn't apply to instruments that mature immediately (which is certainly less than 183 days) and pay not interest (including in the way zero coupon bonds pay interest).

So does this mean Bearer Deposit Notes[1] are illegal? [1]: https://www.tdsecurities.com/tds/pdfs/Manulife_Bank.pdf https://www.tdsecurities.com/tds/pdfs/Manulife_Bank.pdf

JumpCrisscross 9y ago

Bearer bonds [1] are intriguing, mechanically and historically. You will note, under the Restrictions section of your Manulife memorandum [2], that its sale outside Canada or to Americans is prohibited. This is because the issuance of such instruments was practically banned in the United States in 1982 [3]. Bearer instruments are, while prevalent, in decline [4]. It is an active area of global financial regulation [5] where even institutions like the Bank of England have to work to get their notes issued and treated properly. TL; DR A reputable offshore bank might be able to issue a bearer token redeemable for one British pound or Canadian dollar provided they go to great extents to ensure they don't end up in the hands of Americans or anyone in the United States. It would be an uphill battle, however, which in turn necessitates a heavy issuance premium. [1] https://en.wikipedia.org/wiki/Bearer_bond https://en.wikipedia.org/wiki/Bearer_bond [2] https://www.tdsecurities.com/tds/pdfs/Manulife_Bank.pdf https://www.tdsecurities.com/tds/pdfs/Manulife_Bank.pdf [3] https://www.investopedia.com/articles/bonds/08/bearer-bond.asp https://www.investopedia.com/articles/bonds/08/bearer-bond.a... [4] https://ftalphaville.ft.com/2016/04/04/2158236/so-you-thought-bearer-securities-werent-a-thing-anymore/ https://ftalphaville.ft.com/2016/04/04/2158236/so-you-though... [5] http://www.fatf-gafi.org/media/fatf/documents/reports/ML%20and%20TF%20in%20the%20Securities%20Sector.pdf http://www.fatf-gafi.org/media/fatf/documents/reports/ML%20a...

bradleyjg 9y ago
I looked into the law that banned bearer bonds, TEFRA, and I think maybe the relevant provisions wouldn't apply to instruments that mature immediately (which is certainly less than 183 days) and pay not interest (including in the way zero coupon bonds pay interest).