Offshore Dictionary - Terms Explained    by Ronald Edwards

This dictionary should be helpful in understanding the meanings of words used in the world of Offshore Banking and Offshore Incorporation.

Anonymous Bearer Share Corporation - In this corporate structure the ownership of the corporation is not recorded in any registry or database thus the owners are anonymous. The owners hold the physical shares of stock. There is no reportage of transfers of ownership either. Panama is the last place you can get a truly anonymous bearer Share Corporation with no loopholes and no financial statements to file and no tax returns to file. In Panama we refer to this anonymous bearer share corporation as a Sociedad Anonyma which is abbreviated as S.A. at the end of the corporation name.

Anonymous Foundation - This is found in Panama in the form of a Private Interest Foundation. It is anonymous in that the beneficiaries need not be revealed or made public. There are foundation council members which are nominee which means they do not know you. There is also a founder which is often provided by the forming law firm so as to not reveal the person behind the foundation. Foundations may or may not have protectors. Foundations can have secret instructions as to how the assets of the foundation are to be dealt with. Generally foundation assets are non sequesterable which means non freezable.

Anonymous Offshore ATM Card - This term refers to a card that is ATM only and has no name printed on the card. This assures one of greater privacy when drawing money out of an ATM machine in that the bank and operator of the ATM machine does not get your name. Today all ATM and Visa cards must have ID on file for each card which is a government issued ID like a Passport and often a utility bill is required. When you are acquiring the card through a seller in a privacy oriented jurisdiction there is a reasonable amount of privacy.

Anonymous Real Estate Ownership - this is accomplished through titling the real estate in the name of an anonymous bearer share corporation or in the name of the anonymous Panama foundation (fundacion).

Apostille - This is a commonly encountered signature verification process. One first goes to a notary public to get a document signed and notarized. After this is done one takes the document to an Apostille who certifies that the notary is a true and correct licensed notary. It is sort of verifying the notary. Apsotille certificate are usually quite official with seals, signatures stamps etc. Our law firm only requires them for immigration document verification in place of consulate authentication of documents.

For more information on Apostille click here: http://www.panamalaw.org/apostille.html

Asset Protection - This is a term applied to a person specializing in protecting the assets of others generally in an offshore privacy friendly jurisdiction with strong bank secrecy and excellent corporate privacy laws. Asset protection works better in a jurisdiction offshore to your own since the lawyers, courts and government from your own country (there are still a lot of dictatorships out there) have no authority in the offshore jurisdiction, so it is often referred to as offshore asset protection.

Bahamas Offshore Banking - This is an offshore banking and incorporation jurisdiction that was at one time private but is no longer popular. For more information on the Bahamas as an offshore jurisdiction click here:http://www.panamalaw.org/jurisdictions_to_avoid_bahamas.html

Bank - A financial institution that is licensed and regulated by a government that accepts third party deposits and can make loans.

Bank Secrecy - A term applied to offshore banks that are located in a jurisdiction with string bank secrecy laws such as Panama.

Balloon Payment - A large or balloon payment due at the end of a loan, typically a home or car loan, to pay off the amount the payments didn't previously cover. Often used as a loan type in offshore banking and asset protection. A foundation can make a loan to a natural person who then pays interest only for 60 months and then at that time must repay the principal or roll the loan over for another term.

Bearer Bond - This is an instrument where one could carry a government or solid rated bond for $100,000,000 and there is no ID required to negotiate it, well at least back in the 1980's anyway. Why one would feel good about a piece of paper worth so much money is beyond me. This is not something very often encountered.

Bearer Share Corporation - This is a corporation that is formed with bearer share stock certificates. This means the ownership of the bearer share corporation is based on who owns the physical stock certificates. With a Panama Bearer Share Corporation there is no recording of the owners in any registry or database nor is there any recording pertaining to the transfer of the ownership thus it is an anonymous corporation.

Beneficiary - A person legally entitled to receive benefits through a legal device, such as a Panama Foundation also called a Fundacion in Spanish. In Panama foundations the beneficiaries can remain off the public records, anonymous is a good word.

Corporate Agent - Generally a non-lawyer that can form corporations in certain offshore jurisdictions. These people are not attorneys and thus one has no attorney client privilege in dealing with them.

Garnishment - A court-ordered process that takes property from a person to pay a debt. For instance, a person who owes money to a creditor may have her wages garnished if she loses a lawsuit filed by the creditor. Offshore garnishment orders are not valid in countries like Panama.

Grand Cayman Offshore Banking - This refers to banking the offshore jurisdiction of Grand Cayman Islands, also called Cayman Islands. It was at one time in the past a popular offshore banking and incorporating jurisdiction but no longer so.

For more information on the Grand Cayman Islands click here:

http://www.panamalaw.org/jurisdictions_to_avoid_cayman.html

Guillotine Clause - This was an offshore banking trick that worked like this: The offshore bank was given standing wiring instructions to immediately wire the total amount of money in a particular off shore bank account to another bank account in another off shore jurisdiction the very instant any inquiries were made concerning that account by any interested parties. Of course the next bank would have similar instructions and so on down the line so the money could almost stay in constant motion. While banks are no longer allowed to have such Guillotine instructions, a Panama Foundation can have them and execute them by having the foundation protector generate instructions based on certain events spelled out in the Foundation secret instructions pertaining to any asset the foundation has.

Heir - One who receives property from a deceased individual. The term is used commonly when discussing Panama foundations and trusts.

Internet Banking Offshore - This term references a bank that allows clients to access their bank account using the internet from anyplace in the world.

Judgment - This is a term to reference a decision rendered by a court after it has heard a case. It may say so and so has to pay the other entity so much money. In the world of offshore asset protection judgments from other countries are generally not enforceable in the offshore jurisdiction as is the case with Panama.

Jurisdiction - The authority of a court to hear and decide a case. Generally in offshore jurisdictions the courts will not hear a case when the events occurred outside of say Panama and the only reason the case is being brought to Panama is because the entity was a Panamanian Corporation and or there was a Panama bank account involved.

MLAT or Mutual Legal Assistance Treaty - This is a treaty where certain countries agree to help certain other countries obtain evidence in criminal cases. These treaties are full of exceptions, special clauses so there is no universal formula for these, they vary from treaty to treaty.

Natural Person - This is a common offshore legal term meaning a living breathing person as opposed to an unnatural person such as a corporation.

Nominee Directors - In an anonymous bearer share corporation or a Sociedad Anonyma, directors of the corporation are recorded in the public registry, owners are not recorded. So what is done is nominee directors are used who are paid employees and do not know you at all. These people are generally professional directors sitting on the boards of hundreds of corporations seriously confusing anyone trying to track down information from the public registry about any corporation filed in Panama. The nominee directors in Panama are a dead end as far as this is concerned. We normally supply resignation letters from each nominee director giving you control over them. If you are the signatory on a bank account in Panama the banks will not add signatories or remove signatories without the written permission of the existing signatory.

For more information please visit: www.panamalaw.org -- Email us at: panamalegal@hush.com -- or -- Call us at: (507) 6-480-1279

About the Author

The writer is a researcher with years of experience in law and finances.