Items you will need
- Valid passport or a notarized copy
- Documentation of current local address
- Reference from your current bank
- Personal character references
- Funds for deposit
Offshore bank accounts provide attractive benefits like higher interest rates, tax havens, anonymity and freedom from tedious regulations. Traditionally, most consumers have established their accounts in Switzerland, the Cayman Islands and the Channel Islands. Offshore accounts are available in other countries as well. Americans can still take advantage of offshore bank accounts as long as they follow the latest anti-terrorist and tax regulations.
Check the IRS and the U.S. Treasury Department regulations, including the Patriot Act, before you look for an offshore bank. Once you are familiar with the rules for offshore banking, it will be easier to wade through real and empty promises.
Visit OFAC for a list of officially sanctioned countries. Financial transactions by American citizens and businesses in these countries are prohibited by law. Ignoring sanctions can result in criminal charges and severe penalties.
Review the International Monetary Fund's assessments of offshore financial centers to narrow the possible country choices and to reduce your risk of rip-offs or bank failures.
Compare banks to find one that provides all the services that you may need such as wire transfers and online banking.
Contact two or three offshore banks (or their local representatives) to determine qualifications that depositors must meet.
Ask about minimum deposits for savings, checking and private banking. These differ by bank and by country. Expect to deposit $10,000 at minimum in any offshore account. Certain accounts may require a deposit of more than $100,000.
Plan a trip to visit the bank if there is no broker or local representative available near you. Collect the required documentation. You may need to have documents notarized, so plan for this step. Many local banks have notaries.
Arrange a transfer of documents to the bank or its representative by secured mail or courier service.
Expect to deposit funds by wire transfer or certified funds if your application is approved. Be sure to find out how to withdraw funds as needed.
Most consumers can easily afford offshore savings accounts. Fees for private checking accounts are normally much higher at offshore banks.
Switzerland is currently the only country that observes tax treaties with the United States. The IRS can legally obtain information about your offshore accounts in most other countries. Many offshore banks can not offer the same protections that the FDIC provides for depositors in the United States. Find out what recourse you have in case of bank failure. Don't get scammed. Use trusted financial institutions with good reputations and solid backing. Publicly traded international banks are more likely to be solvent over the long haul.