Offshore Tax Dealings Continue to Be Exposed

Offshore Account Update

Posted on October 21, 2016 |

The Bahamas has a long track record of refusing to cooperate with taxing authorities. Back in 2000, the world's leading tax policy forum, the Organization for Economic Cooperation and Development (OECD) blacklisted the Bahama's for aiding in tax dodging and facilitating tax noncompliance. While the Bahama's was taken off the blacklist after rushing nine laws through the next year, the country was put back onto the OECD's “gray list” in 2009 for its “significant nonconformity with international standards.”  The Bahamas was also on a European Union list of 30 countries in 2015 which are considered uncooperative tax havens.

With the Bahama's reputation for protecting privacy and lacking transparency, many accountholders in the Bahamas may have begun to feel comfortable that their private information would remain private. This may have come as a big relief, as an increasing number of Swiss banks and other foreign financial institutions began turning over accountholder information to U.S. authorities.

The IRS and authorities in the U.S. even found themselves stonewalled in money laundering and tax evasion investigations by the fact the Bahama's doesn't provide a digital searchable list of company directors--- which may have made accountholders feel even more secure.

Unfortunately, those with funds offshore in the Bahamas can feel confident in their privacy no longer in light of a recent leak of financial data.  If you have funds offshore, you should be very worried that your info will come to light in this leak, in other leaks, or as a result of bank cooperation. A New Jersey international tax attorney can help you to prepare for the possibility of taxing authorities gaining details about your accounts.

Hack Results in Release of Records of Account Information

A new leak of 1.3 million files has occurred, this time related to the identities of individuals who are associated with companies registered in the Bahamas. The leak follows the Panama Papers, which also shed light on offshore dealings in Panama.  The data from more than 175,000 companies, foundations, and trusts registered in the Bahamas has been made available as a result of the new leak. The data spans the time period between 1990 and 2016, so it contains a lot of information from a long period of time. 

The information has been placed into a database, which can be searched publicly. The files were first provided to a German newspaper, but the paper shared the info with the Washington D.C. based International Consortium of Investigative Journalists.

Some prominent names are featured in the database, including entrepreneurs, politicians, and many others who may have been associated with companies that were created in the Bahamas to try to hide accountholder identities from the IRS or from local taxing officials.

With this information now publicly available, the privacy that offshore accountholders expected due to the long tradition of secrecy in the Bahamas is now off the table.  With the leak of the information following so closely after the release of the Panama Papers, there is reason to worry about more unauthorized information being provided about offshore account in the future. Those with offshore funds must be prepared for their information to be made public and should contact Kevin Thorn to discuss their legal options.

Thorn Law Group

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