Top 12 Offshore Banking Myths Busted

1. Offshore bank accounts are mostly used by spies and criminals -- It would be silly to say that this does not happen, but the reality is that most of the funds kept offshore are deposited by fortune 500 companies shielding their asset base as part of their risk management strategy.  I personally know a TV personality that every person reading this knows, and He banks in Panama among other countries to reduce his risk and protect his assets.
2. Banking offshore is just too much trouble for the average guy -- If you tried to setup your offshore banking structure yourself without the aid of an offshore professional this would certainly be true.  Today, however, an offshore bank account owned by an offshore company is commonly done and only takes about 5 days.  Since governments around the world have been moving to tax individuals on their world wide income, an offshore bank account is usually setup with a bearer share corporation and/or a foundation.
3. Offshore bank accounts are only for rich people.  -- A typical offshore package is less than $2000USD to setup.  Once in place an offshore bank account and offshore company are the basis for a rock solid asset protection and tax plan.
4. Since 9/11 there is no such thing as bank secrecy.  -- This is simply false.  Several offshore jurisdictions like Panama have bank secrecy laws that impose prison sentences to those who violate your bank secrecy.  In addition, Panama also has bearer share corporations that just a private as the infamous numbered Swiss bank accounts.
5. You have to visit the offshore jurisdiction where the bank is located.  -- This is not true.  Everything can be done by phone, fax, email, and courier by an offshore banking professional.
6. Bank secrecy is useless now that all the offshore jurisdictions are in the MLAT (Mutual Legal Assistance Treaty).  -- If you are a criminal there is some merit to this statement.  If you are not a criminal, but just someone trying to protect your money this statement is false.  For an MLAT request to be honored, it must be based on a crime in BOTH countries.  If the offshore country doesn't consider the activity a crime, they will NOT comply with the request.  A great example is tax evasion.  This is a crime in countries like the USA and Canada but in countries like Panama for instance it is not a crime.  MLAT requests for tax evasion are simply denied.
7. Tax treaties now allow most governments to share information freely -- Sadly this is true for many countries, but it is not true of serious offshore jurisdictions like Panama.  Panama has NO TAX TREATIES WITH ANYONE!
8. The authorities will know if I use an offshore bank account -- That is simply not true.  E-commerce and banking all over the internet today rely on secure online encrypted communications.  The largest banks in the world use it and it is completely secure.  It is impossible for anyone to see what you are doing.  Companies like findnot.com can add a second layer of security for those who feel they need it.
9. Offshore banking won't protect me in a lawsuit because the court will order that I bring the funds back. -- If you setup your asset protection plan before you get sued you are well protected.  Once you donate your money to an offshore foundation, for example, they money is not legally yours to get back.  The judge cannot order anything illegal.  If legal proceedings are already under way and you move the funds you might be charged with fraudulent conveyance.  There are ways to avoid this, but it is beyond the scope of this article.
10. Someone will be able to track the money to its offshore destination -- It is true that if you send a wire to an offshore bank their will be a trail.  This is avoided by first wiring the money to another offshore bank usually in another offshore haven.  For example,  the money is wired to a bank account located in Belize and then wired again from Belize to Panama.  Now someone would have to break Belize bank secrecy to even know what country the money is now in.  This is very strong security.
11. I can use my offshore bank account to do everything I currently do with my onshore account. -- There is one thing you can't do with an offshore bank account.  You can't pay bills online.  This is the only feature lacking from most offshore accounts.  This is easily rectified by an good offshore asset protection plan by making a portion of the money available in your onshore account.  This also brings up another feature that deserves mentioning.  Most offshore bank accounts come with a cash card that can be used to withdraw funds anywhere in the world.  The card only traces to the corporation which is often a bearer share corporation (meaning the ownership of it is anonymous)
12. It is illegal to use an offshore bank account -- There is no doubt that you could use an offshore bank account to do something illegal, but opening up an offshore company and bank account is 100% legal.  In fact many fortune 500 companies keep much of their assets safe in offshore countries.