Sales pressure and dishonesty can be just as bad outside the U.S.– especially in some of the less regulated former tax havens and jurisdictions. In some of the island havens there are more high-pressure con artists than sand on the beach. Why? It’s simple. Because they can get away with it.
Although most U.S. regulations exist to promote the best interests of the financial services industry rather than protecting the consumer, there are some practical investor benefits from an over-regulated financial environment. Blatant lies and misinformation will land U.S. financial salespeople in big trouble with their employers, and this can also lead to large fines and even jail time. On the other hand, in many offshore havens the investor-protection regulations sound great but in practice there is minimal enforcement and protection.
Go to exotic locations to enjoy the beach, gamble, or chase your personal pleasures, but do not make the mistake of investing much of your wealth in questionable jurisdictions. For global services and structures in a tropical environment, I personally prefer a few highly selective and professional providers in the more regulated jurisdictions such as the Isle of Man, Bermuda, Belize or the Turks & Caicos Islands. Nevertheless, I still prefer the safety and regulations of an advanced money center like Switzerland.
When you establish asset protection, insurance, or investment accounts outside your home country, be on guard even more than you would at home. Make sure you are dealing in an advanced, heavily regulated top-tier jurisdiction with a long history of financial management, expertise, and infrastructure. Be sure to confirm that the products or investment manager are all part of a long-standing institution that will not go under tomorrow. Also make sure that the offshore product is legal and designed for American investors. Most importantly, make sure you understand your regulatory and reporting requirements to the American authorities. Remember, ignorance is no defense in these matters.
“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.” — Henry Ford
Just as quality offshore providers in this post 9/11 environment will practice due diligence on you and the source of your investment funds, you too should check them out completely. If you feel any pressure or think for a moment the promises and benefits are too good to be true, then they probably are. Stay away from deals, products and strategies that are touted as all benefits and where the downside risks are never mentioned.
Full article available at:
Article Source: http://EzineArticles.com/624216
comments (0)