5 ms·

I am no expert, it would be great to read it from someone with knowledge in this field. What if a shell corp is created in a country that is not included in th

I am no expert, it would be great to read it from someone with knowledge in this field. What if a shell corp is created in a country that is not included in the list of the ownership info automatic exchange? Instead of option A, someone could go with option B and would be fully protected: Option A: Owner in the UK -> Swiss Bank account Option B: Owner in the UK -> Shell corp & legal entity in a country not included in that list -> Swiss Bank account not on the name of the owner, but held by the shell corp/legal entity

teunispeters 7y ago
From following the Vancouver/BC/Canada real estate market, this is very common and normal. (related : Vancouver BC reaching third most expensive city in the world status a couple of years back, for reasons that have little or nothing to do with local populations) The closest I can get to sources though: https://www.cbc.ca/news/canada/british-columbia/laundered-money-bc-real-estate-1.5128769 https://www.cbc.ca/news/canada/british-columbia/laundered-mo... https://www.cbc.ca/radio/podcasts/current-affairs-information/sold/ https://www.cbc.ca/radio/podcasts/current-affairs-informatio...
- magduf 7y ago
  >related : Vancouver BC reaching third most expensive city in the world status a couple of years back, for reasons that have little or nothing to do with local populations What is it due to? I imagine ease of access to Chinese people who want a place to park their savings, plus nice weather, are the biggest factors. After all, all those wealthy Chinese people could just go to another city, like Edmonton, but they don't: what kind of insane person would want to live in a place where it's -40 in the winter if they didn't grow up there?
  - teunispeters 7y ago
    Really healthy support of money laundering by other countries (eg USA, Russia). People blame China "because visible". Although chasing the money there it more seems like China too is making for a nice place for ultrarich (1%) and others (eg drug dealers) trying to dodge taxes or other laws in various countries. There's no data tracked though, and outside of the RCMP investigation there's basically no public information beyond speculation of possible causes. Other than it's not population pressure. There's very large ties between Vancouver, India and China visibly - but nothing to the degree costs hit. I found living there that the influences of India and China helped moderate things and help the city be more liveable.
  - novok 7y ago
    - Accessibility to flights - A large chinese community already being there, seeded by the HK hand over to china. The HK wave did not cause a real estate crisis. - Being known as a "good investment" in China. - RE firms that market in china for vancouver. - Most importantly of all, bad enforcement of money laundering and foreign income laws compared to the USA. If money laundering and tax laws were enforced as badly as Canada in the USA, I bet many of these chinese would be in the USA. The pacific north west is not considered a good place weather wise in the USA.
    - Scoundreller 7y ago
      Such a mess that lawyers got exempted from a bunch of money transfer reporting regulations. I get the need for lawyer-client confidentiality if you’re on trial for murder. You don’t need it if you’re buying property.
    - generatorguy 7y ago
      Climate change has made it much nicer during the real estate boom! 2013-2016 had great summers and no smoke.
    - deleted 7y ago
      [deleted]
    - magduf 7y ago
      >The pacific north west is not considered a good place weather wise in the USA. Where did you get that crazy idea? The PNW is known for being mild, though rainy and not terribly warm. People who like a lot of sun wouldn't like it. But compared to most parts of the country, it's known for "good" weather: in the northeast, it's snowy and brutally cold during the winter. In the southeast, it's brutally hot and humid during the summer, and there's hurricanes. In the (desert) southwest, it's horrifically hot during the summer. In the middle/plains states, it's brutally cold in the winter and there's regular tornadoes. In the Dakotas/Minnesota area, it's horrifically cold in the winter. The PNW doesn't have any of that stuff. Compared to southern California, the weather may not seem as nice to many people, but most of the rest of America does not have the consistently mild and warm weather year-round that SoCal has. But PNW does have consistently mild weather year-round for the most part, albeit without so much sun, and a lot of rain.
freddie_mercury 7y ago
You would have to deal with UK CFC reporting.
silvestrov 7y ago
Wouldn't a logical next step to extend this to all countries that USA + EU trades with? Banking moves slowly, so it will take many years, but I don't think Panama will be able to hide stuff in 50 years from now. If they can strongarm the Swiss, why shouldn't they be able to do it to a lot of other countries who want to trade with USA+EU ?
- captainpiggies 7y ago
  In my personal opinion individuals entirely hiding their assets from their native governments is a thing of the past. Why hide your assets and risk going to jail when you could just pay a consulting firm a fixed amount of money to optimize your tax rate and deductibles to the point where you essentially pay nothing at all.
Havoc 7y ago
That's where the concept of UBO comes in - the reporting party is supposed to trace this through to the ultimate beneficial owner. And if they can't then they're not supposed to accept the business (KYC fail). https://en.wikipedia.org/wiki/Beneficial_ownership https://en.wikipedia.org/wiki/Beneficial_ownership A lot of the offshore locations a laymen can name report this stuff anyway (to varying degrees of course). The whole straight up hiding money approach(Or to put it in hn terms "security through obscurity") isn't really a thing anymore.
- Muromec 7y ago
  Wasn’t there an article recently describing how you can register a company in UK through a web portal and put absolute rubbish in a UBO field without having to submit any single piece of documentary evidence?
  - skunkpocalypse 7y ago
    Irrelevant -- the banks don't use that field; they are required to do their own independent UBO investigation. People don't seem to get this that "shell corporations" are only "shells" until they try to open a bank account or do anything involving money.
  - Havoc 7y ago
    No idea what UK company registration processes look like. Possibly. You're not gonna get far moving your mountain of coin without the help of lawyers, accountants, investment bankers, banks, prime brokers etc. ...none of whom will touch you if you can't prove this stuff reasonably well. As for people submitting straight up fraudulent info - rules don't stop people like that in the same way sternly telling a mugger that it's illegal won't stop them from taking your wallet. Checks & balances sure but beyond a certain level of illegality more rules achieve nothing.
    - _trampeltier 7y ago
      Analysis by Global Witness shows 87,000 properties – 40% of them in London – are anonymously owned by firms registered in tax havens https://www.google.com/amp/s/amp.theguardian.com/uk-news/2019/mar/17/100-billion-of-uk-propert-secretly-owned-anonymous-firms-tax-havens https://www.google.com/amp/s/amp.theguardian.com/uk-news/201...
captainpiggies 7y ago
Very broadly speaking this is what KYC (know your customer) regulation is for which not only deals with the party in business with the financial institutions but also more importantly with the beneficiary of whatever entity this is. So in your example the bank would be under the obligation to ask prior to establishing any business relationship with the shell corporation where does the money come from and where do any gains etc. go to. However if the controller does not do his or her job properly or gets coerced by either the client or the asset manager to enter false or incomplete information this regulation is obviously not very effective and requires regular auditing by the authority (in the case of Switzerland FINMA which is the equivalent of the FTC) There are much better and most importantly legal ways to “optimize taxes” than a simple shell corp. Some of these “corporate constructs” or however you want to call it use loopholes “double Irish with a dutch sandwich” is one of the most notorious ones.

teunispeters 7y ago

From following the Vancouver/BC/Canada real estate market, this is very common and normal. (related : Vancouver BC reaching third most expensive city in the world status a couple of years back, for reasons that have little or nothing to do with local populations) The closest I can get to sources though: https://www.cbc.ca/news/canada/british-columbia/laundered-money-bc-real-estate-1.5128769 https://www.cbc.ca/news/canada/british-columbia/laundered-mo... https://www.cbc.ca/radio/podcasts/current-affairs-information/sold/ https://www.cbc.ca/radio/podcasts/current-affairs-informatio...

magduf 7y ago
>related : Vancouver BC reaching third most expensive city in the world status a couple of years back, for reasons that have little or nothing to do with local populations What is it due to? I imagine ease of access to Chinese people who want a place to park their savings, plus nice weather, are the biggest factors. After all, all those wealthy Chinese people could just go to another city, like Edmonton, but they don't: what kind of insane person would want to live in a place where it's -40 in the winter if they didn't grow up there?
- teunispeters 7y ago
  Really healthy support of money laundering by other countries (eg USA, Russia). People blame China "because visible". Although chasing the money there it more seems like China too is making for a nice place for ultrarich (1%) and others (eg drug dealers) trying to dodge taxes or other laws in various countries. There's no data tracked though, and outside of the RCMP investigation there's basically no public information beyond speculation of possible causes. Other than it's not population pressure. There's very large ties between Vancouver, India and China visibly - but nothing to the degree costs hit. I found living there that the influences of India and China helped moderate things and help the city be more liveable.
- novok 7y ago
  - Accessibility to flights - A large chinese community already being there, seeded by the HK hand over to china. The HK wave did not cause a real estate crisis. - Being known as a "good investment" in China. - RE firms that market in china for vancouver. - Most importantly of all, bad enforcement of money laundering and foreign income laws compared to the USA. If money laundering and tax laws were enforced as badly as Canada in the USA, I bet many of these chinese would be in the USA. The pacific north west is not considered a good place weather wise in the USA.
  - Scoundreller 7y ago
    Such a mess that lawyers got exempted from a bunch of money transfer reporting regulations. I get the need for lawyer-client confidentiality if you’re on trial for murder. You don’t need it if you’re buying property.
  - generatorguy 7y ago
    Climate change has made it much nicer during the real estate boom! 2013-2016 had great summers and no smoke.
  - deleted 7y ago
    [deleted]
  - magduf 7y ago
    >The pacific north west is not considered a good place weather wise in the USA. Where did you get that crazy idea? The PNW is known for being mild, though rainy and not terribly warm. People who like a lot of sun wouldn't like it. But compared to most parts of the country, it's known for "good" weather: in the northeast, it's snowy and brutally cold during the winter. In the southeast, it's brutally hot and humid during the summer, and there's hurricanes. In the (desert) southwest, it's horrifically hot during the summer. In the middle/plains states, it's brutally cold in the winter and there's regular tornadoes. In the Dakotas/Minnesota area, it's horrifically cold in the winter. The PNW doesn't have any of that stuff. Compared to southern California, the weather may not seem as nice to many people, but most of the rest of America does not have the consistently mild and warm weather year-round that SoCal has. But PNW does have consistently mild weather year-round for the most part, albeit without so much sun, and a lot of rain.

freddie_mercury 7y ago

You would have to deal with UK CFC reporting.

silvestrov 7y ago

Wouldn't a logical next step to extend this to all countries that USA + EU trades with? Banking moves slowly, so it will take many years, but I don't think Panama will be able to hide stuff in 50 years from now. If they can strongarm the Swiss, why shouldn't they be able to do it to a lot of other countries who want to trade with USA+EU ?

captainpiggies 7y ago
In my personal opinion individuals entirely hiding their assets from their native governments is a thing of the past. Why hide your assets and risk going to jail when you could just pay a consulting firm a fixed amount of money to optimize your tax rate and deductibles to the point where you essentially pay nothing at all.

Havoc 7y ago

That's where the concept of UBO comes in - the reporting party is supposed to trace this through to the ultimate beneficial owner. And if they can't then they're not supposed to accept the business (KYC fail). https://en.wikipedia.org/wiki/Beneficial_ownership https://en.wikipedia.org/wiki/Beneficial_ownership A lot of the offshore locations a laymen can name report this stuff anyway (to varying degrees of course). The whole straight up hiding money approach(Or to put it in hn terms "security through obscurity") isn't really a thing anymore.

Muromec 7y ago
Wasn’t there an article recently describing how you can register a company in UK through a web portal and put absolute rubbish in a UBO field without having to submit any single piece of documentary evidence?
- skunkpocalypse 7y ago
  Irrelevant -- the banks don't use that field; they are required to do their own independent UBO investigation. People don't seem to get this that "shell corporations" are only "shells" until they try to open a bank account or do anything involving money.
- Havoc 7y ago
  No idea what UK company registration processes look like. Possibly. You're not gonna get far moving your mountain of coin without the help of lawyers, accountants, investment bankers, banks, prime brokers etc. ...none of whom will touch you if you can't prove this stuff reasonably well. As for people submitting straight up fraudulent info - rules don't stop people like that in the same way sternly telling a mugger that it's illegal won't stop them from taking your wallet. Checks & balances sure but beyond a certain level of illegality more rules achieve nothing.
  - _trampeltier 7y ago
    Analysis by Global Witness shows 87,000 properties – 40% of them in London – are anonymously owned by firms registered in tax havens https://www.google.com/amp/s/amp.theguardian.com/uk-news/2019/mar/17/100-billion-of-uk-propert-secretly-owned-anonymous-firms-tax-havens https://www.google.com/amp/s/amp.theguardian.com/uk-news/201...

captainpiggies 7y ago

Very broadly speaking this is what KYC (know your customer) regulation is for which not only deals with the party in business with the financial institutions but also more importantly with the beneficiary of whatever entity this is. So in your example the bank would be under the obligation to ask prior to establishing any business relationship with the shell corporation where does the money come from and where do any gains etc. go to. However if the controller does not do his or her job properly or gets coerced by either the client or the asset manager to enter false or incomplete information this regulation is obviously not very effective and requires regular auditing by the authority (in the case of Switzerland FINMA which is the equivalent of the FTC) There are much better and most importantly legal ways to “optimize taxes” than a simple shell corp. Some of these “corporate constructs” or however you want to call it use loopholes “double Irish with a dutch sandwich” is one of the most notorious ones.