Balancing compliance and confidentiality in the fiduciary industry
A vital perspective for individuals and companies that include offshore jurisdictions and offshore services in their business planning.
Here at Woodbrook Group Corporate Service, our intelligent approach to fiduciary and offshore jurisdiction services is tuned to the new era of increased regulation in which we all operate today.
Excluding the banking, stock broking and fund industries, the financial world has moved from self-regulation to extensive regulation, with requirements very similar to the banking sector. In many cases, recent world events are behind the introduction of new laws and substantially increased regulation.
Countries like the United Kingdom, for example, have passed legislation that was originally intended to deal with the terrorist threat, but is ultimately being applied for other purposes. The definition of money laundering within this legislation has been used to make lawyers and accountants informants against their legitimate clients. Because of these laws, certain banks in respected jurisdictions have passed information on depositors from the UK to the Inland Revenue.
The tax authorities of the major industrial nations have become more sophisticated, and their governments are hungry for revenues. These tax authorities increasingly exchange information with each other, although they compete against each other for revenues too. In other words, a UK citizen can no longer discuss his tax affairs in confidence with his lawyer or accountant.
All these changes require high-net-worth clients to consider the structuring of their assets with great care, as the traditional offshore jurisdictions have come under increasing pressure. Simple tasks of opening bank accounts have become complicated and time-consuming.
Nevertheless, secretarial service providers are obligated to comply with the regulatory requirements of each country where they operate. Some clients consider their freedom restricted and will object to the intrusion into their private business affairs. In most cases the standards we have been practising for years at Woodbrook Group Corporate Service exceed those stipulated by these new regulations. In the interest of our clients, we have sold subsidiaries that were once established in jurisdictions that no longer satisfy our clients’ confidentiality requirements.
Instead, we have refocused our business on countries offering tax efficiency combined with confidentiality.
For further information on compliance and corporate governance requirements, please contact us.