Kenneth Rijock

Kenneth Rijock

Sunday, May 27, 2012

WATCH CAPITAL OUTFLOW FROM LIECHTENSTEIN FOR DIRTY MONEY



Recently published statistics show a large exit of capital from bank accounts located in the Principality of Liechtenstein has already occurred in 2012.  Much of the "capital flight" has been attributed to the fears of American depositors that their identities will shortly be required to be reported to US tax authorities, under FATCA in 2012, and funds that will be withheld in the future. Banks in that country have sent notices to clients located in America to that effect, and some tax cheats will undoubtedly want to move their funds to Asian financial institutions, or elsewhere. Treaties with EU countries are also responsible for the list of a reported one third of assets in local banks in the last three years.



There is another group of Liechtenstein account holders that will be moving their funds out; organised crime, whether they be narcotics traffickers, illegal gambling operators, smugglers of counterfeit goods, or any other illicit trade, whose "entrepreneurs" have been secreting their criminal proceeds in Liechtensteiner banks for decades, long before effective and enforced compliance procedures were in place.



Should you routinely demand detailed (and verified) Source of Funds and corporate Beneficial Ownership information on all transfers originating in Liechtenstein ? Absolutely; to do any less probably falls below banking best practises. It may even reach a risk level that will rule out accepting any such funds. You make that decision, but it is humbly suggested that you weight the potential risks to your bank's reputation if it the media publicised its new "tax haven" policy; Be careful.


No comments:

Post a Comment

Note: Only a member of this blog may post a comment.