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We don't want to incentivize people to dodge taxes while thinking they'll enjoy all the protections paid for by taxes. This exactly. Either the deposits were i
by award_ 3y ago
We don't want to incentivize people to dodge taxes while thinking they'll enjoy all the protections paid for by taxes.
This exactly. Either the deposits were insured or they weren't (as it seems in this case). Can't have it both ways, having cake and eating it too.
- nickff 3y agoWhat "protections paid for by taxes" are you talking about? FDIC isn't paid for by taxes.
- lowbloodsugar 3y agoUS banks are regulated by the US government. One part of that regulation is that they must pay into a government body called the FDIC. Most people would say that if the government adds to your cost of doing business by forcing you to pay money proportional to some amount of money you collect or spend, then that's taxes. Ultimately, the FDIC is backed by "the full faith and credit of the United States government", which means if push comes to shove, it's backed by taxes. Regardless of whether it really is taxes or not, it is an extra cost of doing business that the Cayman islands do not have, and therefore do not pass on to their customers. So reasonably, if one puts money in the Cayman Islands one is enjoying the benefits of looser regulation, i.e. lower costs. You can't then complain when that looser regulation includes not enforcing deposit insurance and you lose all your money.