Wealth International, Limited

Offshore News Digest for Week of July 28, 2003


Bermuda Premier Jennifer Smith was ousted by members of her own party late on Sunday, three days after winning the general election in the British colony. Smith, viewed by her critics as arrogant and secretive, had scraped to a win by just eight votes in her own constituency in last Thursday’s election and then faced a party revolt. Works Minister Alex Scott is now the Leader of the Progressive Labour Party (PLP).

More on this story here and here.


A 1998 review of financial and court documents by The Philadelphia Inquirer show that Lebanese businessman Watche A. Manoukian has used the Philadelphia Park racetrack racetrack as the hub of an expanding American gambling empire that ships tens of millions of dollars overseas -- virtually tax free -- to a family company in Liechtenstein, a country renowned as a tax haven. A follow-up story by the Inquirer last year showed the pattern continuing through the end of 2001.

More on this story here.


Speaking at a recent seminar attended by OECD tax policy and administration center official, Jeffrey Owens, Advocate Peter Ferbrache observed that: “[In Delaware] you do not have to say who you are, whereas here if you want to open a business, you almost have to state your heritage going back to 1066.” He continued: “How on earth are you going to have a level playing field?”

More on this story here.


With a population of 28,000, the Republic of San Marino is Europe’s second-smallest country, after the Vatican City. It covers just 24 square miles, a landlocked city-state in the northeast of Italy, six miles inland from the coastal resort of Rimini.

Residents share the Italian language and the Catholic religion with their neighbor, but they take pride in their separate nationality -- as well as their lower taxes, higher per-capita income and 17 centuries of history that lead them to call their country the world’s oldest republic.

San Marino is one of a handful of European microstates -- in addition to the Vatican, the others are Monaco, Liechtenstein and Andorra -- that are thriving in a Europe that is de-emphasizing national boundaries. San Marino, which joined the United Nations in 1992, uses the euro, as do Italy and most of the rest of Europe. But it is not and may never be a member of the European Union. That would require changes in its tax, banking and citizenship policies, changes Sammarinese say they are not interested in making.

San Marino’s top personal income-tax rate is 12%, versus 33% in Italy. No wonder, then, that the only way to become a citizen is to live there for 30 years.

More on this story here.


Saga, which sells other insurers’ cover to one million UK drivers, insists it is making the move only because offshore regulations mean it can sell its own insurance.

More on this story here.


A judge has accused Scotland Yard of committing a “state-created” crime by setting up an undercover money-laundering operation to catch suspected drug dealers. Southwark Crown Court heard that detectives set up a false company, laundered £15 million and then gave it back to the suspects so that the police could continue gathering evidence.

The case has lasted five years and taxpayers are now facing an estimated bill of £25 million for the costs, with the possibility of civil action by defendants seeking compensation adding to the bill.

More on this story here.


Switzerland’s highest court says the country’s system of direct democracy must stay within the limits of the law. The Federal Court’s comments came in a written explanation of a ruling made on July 9, banning secret ballots on applications for Swiss citizenship.

The judges said that Swiss voters, while traditionally having the last word on all political decisions, were still obliged to respect federal legislation. Several Swiss communities, most notably Emmen in canton Lucerne, hold secret ballots to decide on citizenship. Critics of the procedure say it leads to racial discrimination. The federal judges upheld this view in their written ruling, saying that unfair ballot decisions cannot be justified by claims that direct democracy overrules everything else.

More on this story here.


Offshore discretionary trusts were originally created for the management and protection of the assets of the truly wealthy, usually in cases where a meaningful donation had been made, and this still remains their primary role. However, the many problems attached to offshore trusts are pushing investors more and more to explore offshore alternatives, says Dr. Barry Spitz, an international tax and trusts expert.

According to estimates by Scotland Yard and the United States Federal Bureau of Investigation, 60% of all of the money in the world is held offshore. Industry specialists claim that some 40% of that amount is held in or under offshore trusts. If these figures are correct, that would mean that offshore trusts hover over about a quarter of the world’s investment wealth.

Spitz says a trust has, at its heart, a number of essential fundamentals that South African and other clients frequently refuse to accept as part of the trust relationship, including the fundamental requirement that a trustee should take full legal ownership and control of the assets settled in the trust by the settlor, or the person who set up the trust.

“Where the settlor later seeks to protect his funds against creditors, spouses or tax authorities, in a discretionary offshore trust, but has used devices, such as letters of wishes or protectors, to keep control of the funds, the courts are now seeing right through the trust and declaring the assets to be still vested in the hands of the settlor. Papers before the House of Lords indicate that perhaps 90% of all offshore trusts are invalid on the grounds that the settlor is calling the shots.”

More on this story here.

More reasons for South Africans to fret about offshore assets.

Since July 1 2001 there have been two major developments that may well be the persuading factors in getting taxpayers to apply for the offshore amnesty. Neither are directly related to tax.

More on this story here.

SA police arrest man in Absa Net bank fraud case.

South African police have arrested a man on suspicion of the fraud involving the illegal transfers of hundreds of thousands of rand from Internet accounts held at Absa, the country's largest bank. The case involves the unauthorised removal of R500,000 (£41,300) from bank accounts run by an estimated ten separate Absa customers.

Meanwhile, despite been criticised for its handling of the problem earlier this week, Absa said it had signed up an extra 1,273 new clients in the past four days. Absa has 405,000 Internet banking clients.

More on this story here.

Mandela’s good intentions amount to little for the poor.

The very structures and institutions that Mandela presided over as president are increasingly undermining the social democracy envisaged by the man whose entire life’s project was about liberating himself and others. As South Africa enters its 10th year of democratic rule, and while political rights, human rights and social justice are enshrined in its constitution, economic inequalities are rife. Poverty persists and unaffordable health services remain a gripping reminder that the political revolution of 1994 has not produced the social services necessary to keep a nation healthy.

More on this story here.


The index ranks 50 countries, taking into account the burden placed on firms by personal, corporate and social security taxes. The lower the index score achieved, the higher the country will be placed on the ranking. Hong Kong, with an index score of 43 is placed first in the league table, whilst France props up the list with a score of 179.4. Other notable scores include the USA, which is ranked eighth, and India, which is placed third in the survey. China, meanwhile, was ranked 45th.

More on this story here.

Hong Kong tipped as offshore renminbi center.

Hong Kong would be chosen if the mainland proceeds with the plan, Chief Executive Tung Chee-hwa said, while revealing other free-trade measures being rolled out to help Hong Kong’s economic recovery and restructuring. The mainland will consider allowing Hong Kong banks to conduct renminbi business for individuals on a trial basis, including deposits, remittances, exchange and credit card business, Tung said.

More on this story here.


Government corruption and inefficiency -- the issues that caused the ouster of former Philippine leader Joseph Estrada in 2001 -- are now threatening his successor, Gloria Macapagal Arroyo. Although a mutiny against Mrs. Macapagal by nearly 300 young elite army officers and soldiers ended on Sunday, the revolt is likely to dash any prospects that she will stand again in presidential elections next year.

The military rebels, some of whom have been fighting Islamic extremists in the southern Philippines, have highlighted the issue of military corruption as the main cause for the government’s failure to end terrorism in the country. The government’s credibility in the fight against terrorism has been weakened by allegations that generals have abetted the illicit sale of arms and ammunition to Muslim rebels to prolong the separatist war.

The military has also been accused of staging the bombing of mosques to snare tens of millions of dollars in US military aid, some of which is suspected to have been diverted into the pockets of senior officers.

Many Filipinos, although not supporting the mutiny, seemed ready to grant credibility to some of the rebel soldiers’ allegations.

More on this story here.


From October 1, more than 100,000 New Zealanders will not be allowed into the United States because their passports are not machine-readable. The rule applies equally to those visiting the US or in transit through any airport there.

If you try to enter an American airport without a machine-readable passport after the rule comes into force then you will be put on a plane home. There is a quick way to check what type of New Zealand passport you have. If your passport is a machine-readable version then its number will begin with the letter X, L, N, or F or the letters AA. If it is not, then the number will begin with the letter J or M.

Have a nice day.

More on this story here.


Responding to the UK government’s background paper on residence and domicile in the United Kingdom for tax purposes, tax consultancy WJB Chiltern has suggested that in its opinion, no major changes should be made to the existing system, as increasing the tax burden on non-domiciled residents could harm the country’s international competitiveness.

However, given the amount of adverse publicity generated by a “loophole” which allows non-domiciled citizens to avoid UK taxation on a significant portion of their earnings, it seems unlikely that the government will be able to avoid making some changes to the way in which such people are taxed. In the event, then, that the government does implement changes to the tax regime for so-called “non-doms”, the firm has released a list of five measures that it would support.

More on this story here.

Damning report on Inland Revenue conduct issued.

The Treasury Select Committee has issued a damning report “Inland Revenue Matters” on the conduct of the Inland Revenue and the Paymaster General Dawn Primarolo. The Committee has a remit to examine the work of the Inland Revenue on a regular basis. On this occasion the report covered three matters in particular: restricting the use of offshore tax structures by bidders to procurement contracts; the implementation of the new tax credits; and the suspension of National Insurance Contributions Deficiency Notices.

More on this story here.


There is a fairy tale: “In the late 1980s, a country adopted a unique model of wage determination, involving extensive consultation and agreement between the social partners. The two key elements were wage restraint in return for income tax cuts and ongoing participation in economic decision-making through social partnership committees. National pay agreements kept the lid on pay claims during a period of unprecedented output growth and thus enabled this growth to translate into higher employment and lower unemployment.”

This is no fairy tale; it is the history of Ireland. Ireland has had the fastest growth rate among OECD members. The unemployment rate has dropped from a peak of almost 20% in 1989 to below 4% at present. Over the past 10 years, the work force in this land of 3.7 million people has grown from 1 million to 1.8 million.

More on this story here.


North American and European private banks may have had it rough last year as wealth destruction continued, albeit on a smaller scale compared to 2001, but their counterparts in Asia (ex-Japan) were revelling in it as they bucked the trend, results of a Global Wealth Report show.

The Boston Consulting Group (BCG) said along with millionaire investors who were hard hit, in North America they lost $2 trillion and €500 billion, private bankers shared the pain, as shrinking wealth resulted in lower fees and commissions.

Many Asian private bankers celebrated their best ever year in 2002, with a profit growth of 18% average whilst their US and European counterparts struggled to stay profitable,” said its BCG Singapore office vice-president and director Roman Scott, who is also Asia head of wealth management.

Scott pointed to the “great combination” which allows for Asia’s growth -- the economic fundamentals that support new wealth creation continues to be strong, and the industry’s immaturity, which allows for lots of room for growth.

More on this story here.


Fair-weather players in the global arena, the Big Five seldom miss an opportunity to miss the opportunity of leveraging their unshakeable strength at home. They have not the stomach to wait out bad times abroad, snap up faltering rivals and be counted among the robust survivors after periodic setbacks.

Why? For Alcan and Magna, global success is a matter of survival. But with a lucrative oligopoly at home to fall back on, the Big Five can afford to fail abroad. And so they chronically do. At home, the Big Five are protected from foreign competition by their entrenched position and laws that severely crimp offshore interlopers. Add to that bankerly caution, lack of entrepreneurial spirit and the absence of CEO accountability arising from the Big Five’s widely held status, and the inevitable result is timidity.

More on this story here.


While some European countries have banned the industry -- a multimillion-dollar industry providing advice for people pursing immigration claims, making it illegal to offer advice for money, the use of agents in Australia is so entrenched that this is not regarded as viable. While they can perform a useful intermediary role, there are concerns about exploitation and abuse.

Scams involving registered agents continue to surface. There have been reports of their deep involvement in trafficking prostitutes through poorer Asian and European nations into unlicensed brothels. The Government is feeling the political heat. It has set up a taskforce to identify unscrupulous operators and target related criminal behaviour.

More on this story here.

New Zealand parliament seeks legal advice over MP’s status.

Parliament is seeking independent legal advice on the status of Labour MP Harry Duynhoven, who has fallen foul of a quirk of an aged electoral law. He had apparently broken an “ancient” provision of electoral law by renewing his Dutch citizenship.

More on this story here.


A federal appeals court dealt a blow to accountants’ ability to protect the identity of investors in tax shelters, ruling that one firm must turn over clients’ names to regulators. The decision by a panel of the United States Court of Appeals for the Seventh Circuit, which covers Illinois, Wisconsin and Indiana, makes it very likely that the accounting firm, BDO Seidman, will have to give the names to the I.R.S. -- which will then know whose tax returns to audit, lawyers said.

The court’s decision turned on its finding that under the tax code, BDO has an obligation to keep records on and report to the I.R.S. the identity of investors in tax shelters. That requirement means that the investors in the shelters did not have “an expectation of confidentiality in their communications with BDO, an essential element” of the privilege, the court found.

Lee Sheppard, who critiques tax issues for the magazine Tax Notes, said the BDO decision “means that if you filed a tax return with a tax shelter then your name is not a secret any more and you have no reason to believe that the guys who sold you the tax shelter will keep it secret.” Ms. Sheppard said the decision was a victory for the government and “the fact that there is no confidentiality to what you put on a tax return.”

More on this story here.

Judge orders Southern California tax attorney to stop selling services.

A federal judge has barred Eduardo Rivera from selling alleged tax-evasion plans over the Internet and in person. The judge also ordered Eduardo Rivera to identify his clients to federal investigators and post the injunction on his Web site.

Rivera’s Web site states, “The focus of our service is to provide legal documentation, educational materials, and workshops to educate, inspire and assist the people in their desire to opt out of the voluntary tax system with the least amount of risk.”

More on this story here.

More delays in IRS modernization program.

The IRS announced last week that a major milestone in the agency’s massive modernization project will not be met. The first phase of the Customer Account Data Engine (CADE), a database that will eventually hold tax records of all of the nation’s taxpayers, was scheduled to go online in August, 2003, after an earlier postponement from December, 2001. Delays in programming will postpone the launch for at least another year.

More on this story here.


The handiwork of the 105 members of the convention which, led by former French President Valery Giscard d’Estaing, worked on drafting the EU constitution document for 16 months reflects a failure to grasp what a proper constitution does and does not do.

A proper constitution distributes power among legislative, executive and judicial institutions so that the will of the majority can be measured, expressed in policy and, for the protection of minorities, somewhat limited. A proper constitution does not give canonical status, as rights elevated beyond debate, to the policy preferences of the moment. But that is what the proposed European Union constitution, with more than 400 articles, does.

Europe’s evolving domestic arrangements would profit from what clearly has not yet occurred -- a serious study of ambiguities and difficulties that have surrounded the oldest and most successful written constitution, America’s.

More on this story here.


The EC moved to limit the damage caused by a rumbling fraud scandal, ordering all departments to check if they hold illegal cash reserves. It also severed contracts between Eurostat, the commission’s troubled statistics agency, and three outside firms suspected of involvement in what French investigators have called in one instance “a vast enterprise of looting”.

More on this story here.


Polls show that Bulgarians strongly support their country’s effort to join the European Union. This is striking when compared to the situation in the former communist countries acceding to the Union next year. Sure, Bulgaria’s EU prospects are rather distant and romantically vague; and sure, such public support will decrease as these prospects become clearer and closer. This has been the trend all over Central and Eastern Europe. The more interesting question here is: What would be the effect of this process of integration not on public opinion, but on real life in Bulgaria and on the freedom of its citizens in particular?

In a country where it is not uncommon to need between 15 and 20 licenses and permissions to open a small cafeteria -- and, if one survives the procedure, to be totally unprotected from the blackmail of low-level government employees and the neighborhood gangs -- it is obvious that there is something very wrong. Plenty of other examples are available to show why corruption of the bureaucracy and an ineffective legal system are listed as top problems by the citizens and small domestic businesses, as well as by the few big foreign corporations that dare to invest. What effect could Bulgarian EU integration have on all this?

More on this story here.


Congressman Ron Paul praised two landmark votes in Congress that could mark a turning point in the battle to protect civil liberties threatened by the Patriot Act. Paul has been an outspoken critic of the Patriot Act since its hasty passage in the weeks following the 9/11 terrorist attacks.

The House of Representatives recently passed two amendments to the annual Justice department funding bill that show many in Congress are having second thoughts about the Patriot Act. However, the battle against the Patriot Act has only just begun as the Senate could strip the new restrictions passed by the House. Both the administration and congressional leadership continue to support the Act, despite public outcry against it and growing opposition among rank and file members of the House. Paul and hundreds of his House colleagues now hope to capitalize on their momentum by working to repeal all or part of the Patriot Act itself.

More on this story here.


America’s prison population grew again in 2002 despite a declining crime rate, costing the federal government and states an estimated $40 billion a year at a time of rampant budget shortfalls. The inmate population in 2002 of more than 2.1 million represented a 2.6% increase over 2001, according to a report released Sunday by the Bureau of Justice Statistics.

Experts say mandatory sentences, especially for nonviolent drug offenders, are a major reason inmate populations have risen for 30 years. About one of every 143 U.S. residents was in the federal, state or local custody at year’s end.

The cost of housing, feeding and caring for a prison inmate is roughly $20,000 per year, or about $40 billion nationwide using 2002 figures, according to The Sentencing Project, a nonprofit organization that promotes alternatives to prison. Construction costs are about $100,000 per cell.

More on this story here.

Population bomb behind bars.

The massive expenditure of tax dollars on prison construction has spawned some bizarre dynamics. A generation ago, few people wished to live near a prison. Today, small towns and cities undergoing hard times tenaciously lobby for prisons to be built in their backyards. Those cities that are unsuccessful go back to the state legislature to push for more prison construction -- and then vie again for the coveted selection site.

In California, the Correctional Peace Officers Union has grown so large that it is now a political force. With over 27,000 dues-paying prison guards, the union gives political contributions to the candidates who promise to build more prisons, hire more guards, and increase guard salaries and benefits. And the private firms who contract with the prison authorities for assorted supplies are political players too -- since they are well aware that as the prison population grows, their revenues rise ever higher. Some analysts have dubbed this political racket the “prison-industrial complex”.

A close look at crime statistics reveals that the drug war is fueling the remarkable growth in our prison population. In 1981, only 22% of federal inmates were drug prisoners. Today [early 2000], 60% are drug prisoners. One nasty (but unavoidable) effect of waging a drug war with limited jail space is that violent criminals will sometimes be released from prison in order to make room for drug offenders.

More on this story here.


Immigration Minister Denis Coderre said Canadians will be carrying highly secure national ID cards by 2005 because of increasing pressure throughout the international community, particularly the United States, for tougher security measures.

It is the “highly secure” aspect of his statement that is cause for concern. Just this week, it was revealed that Canada’s Maple Leaf card for new immigrants is already being counterfeited in Europe. That card was hastily issued following intense pressure from the U.S. in the wake of Sept. 11 so we are not overly confident in the government’s ability to produce a tamper-proof national ID card.

Rest of this editorial here.


NTT, Mitsubishi and Hitachi said they have succeded in developing a more effective type of cryptography based on what the companies call elliptic curve cryptosystems.

More on this story here.


A well-designed and transparent touch-screen ballot system with proper cryptographic protections and a robust auditing mechanism would go a long way to avoiding recount debacles like the one in Florida that made the 2000 elections so intriguing. Unfortunately, the systems that state and local governments have been throwing taxpayers’ money at are closed, poorly protected against fraud, and lacking in adequate auditing features.

Such is the conclusion of a group of university researchers who got their hands on some of Diebold’s e-balloting software. A recent study finds that the Diebold system lacks basic fraud prevention features.

More on this story here.


One in ten jobs in US tech vendors and IT service providers will move offshore by the end of 2004. And one in 20 tech jobs in end-user enterprises will be shipped overseas to cheaper countries during that time, technology analyst firm Gartner estimates.

The accelerating move offshore will surely encourage more US workers in tech industries to seek union representation. Only today, Techweb reports that employees at IBM are starting to organise in response to plans from their employer to move thousands of jobs abroad.

More on this story here.


A pension crisis -- one that is inviting comparisons to the massive savings-and-loan-industry bailout of the late 1980s -- is coming to the forefront in Washington. Last Wednesday, Congressional investigators designated the government-sponsored program that insures the pensions of 44 million private-sector workers as “high risk”. In fact, the Pension Benefit Guarantee Corp. is running the highest deficit in the program’s 29-year history, prompting the Bush administration to say the nation’s private pension system needs major reforms.

The PBGC has suffered a $15 billion downturn in its financial health since 2000, moving from a $9.7 billion surplus three years ago to a $5.4 billion deficit by April. To blame is a surge in pension-plan terminations, with private companies that cannot meet their pension obligations ending their plans and turning over their pension assets to the PBGC, which then continues paying retirees.

With an estimated $300 billion in underfunded pensions among the nation’s corporations as of April, the PBGC sees more trouble brewing. Employers are struggling with massive pension-underfunding problems caused by the downturn in the market, low interest rates and an increasing number of aging workers. Airlines have $26 billion in pension underfunding, the PBGC has said, and automakers have $60 billion in unfunded obligations.

More on this story here.


Home working is not new but a recent survey by the Economist Intelligence Group for AT&T indicates organizations expect much more home working in the future. As the survey puts it, “Its time has come”. A global survey of 237 senior executives showed that a bare majority of employees are expected to work from the main office by 2005. Full time telecommuters now make up 6% of US employment and in Western Europe the number of telecommuters is expected to double to 8.7 million by 2005.

There are three reasons why growth is happening now. Firstly, virtual teams are being increasingly used to support distributed global organisations. Secondly, we are all increasingly comfortable with working electronically using email, instant messaging and shared workspaces. Thirdly, improvements in the price, performance and ease of use of teleworking tools make it feasible to provide every member of staff with a rich set of tools that can do the job.

Of course, teleworking will not happen unless people accept new ways of working.

More on this story here.


Citizenship is the relationship between an individual and a sovereign State, defined by the law of that State and with corresponding duties and rights. A passport is a personal identification and travel document for international use issued by a sovereign State. Generally, only passports which are issued based on a person’s citizenship are of any interest and use. Only through the acquisition of full citizenship can you legally acquire the right to a passport.

More on this story here.

Dual passport and other swindles.

As offshore services become more popular, offshore scams and frauds proliferate. There are many sources for scam growth, but the Internet is a new favorite for fraudsters.

More advice here.


Effective July 29, all Mastercards issued by Leadenhall Bank and Trust were canceled. Leadenhall, which was established in 1975, marketed offshore credit cards to expatriates as a means of accessing personal funds outside The Bahamas. The IRS views this and similar offshore credit-card operations as tax-avoidance schemes.

“This is a very sophisticated operation that is IT-oriented and good for The Bahamas, but you don’t go around rubbing it in Uncle Sam’s eye. They should have been more discreet,” according to one financial analyst.

More on this story here.


Tackling money on a level playing field in Guernsey.

Only 10 miles of the English Channel separate Guernsey from France. The island is either lynchpin or bete-noire of the European Union, depending on one’s point of view. Its European neighbours’ plans to allow exchange of information between tax authorities on savings is causing considerable concern among Guernsey’s local politicians and its financial institutions.

Currently there is fierce local debate on how Guernsey should react to the planned European Savings Tax, aimed at curbing tax evasion in EU member states. One reason that Guernsey may opt for a withholding tax rather than agreeing to exchange information with other tax authorities, is that Switzerland has opted for the withholding tax and several Swiss banks operate on the island.

More on this story here.

Jersey aims to build up confidence.

Every major world financial centre is suffering from the current lack of confidence among investors, and Jersey is no exception. However, the creation in August of a new headquarters for the HSBC banking group in the island’s capital, St Helier, shows that at least one global financial institution is confident about the island’s future as an international financial center.

More on this story here.

Isle of Man red card for those who don’t play the game.

The Isle of Man is regarded as one of the safest investment centers for individual investors. The island’s investor protection system is among the most thorough of Europe’s offshore financial centers.

In return for providing protection and fair dealing, the Isle of Man authorities do not tolerate international investors who “don’t play the game”. The island strictly abides by international anti-money laundering agreements and its financial institutions enforce thorough “know your customer rules”. These may seem irksome to legitimate customers, but they are designed to keep your money safe.

After some uncertainty over which method to adopt, the Isle of Man government has opted to levy a “withholding tax” rather than provide automatic exchange of information with the tax authorities of an EU investor’s home state.

More on this story here.

Jersay banks gain as investors switch to deposits.

International investor nervousness is boosting deposits at Jersey banks as customers prefer to keep their funds in cash rather than risk them on the stock market. The next set of Jersey deposit figures is expected to show a healthy rise from the previous £135 billion. Despite this, not all is rosy for the island’s banks and some are trimming staff numbers and moving some activities elsewhere in order to cut costs.

More on this story here.


Less than three months before Switzerland’s general election the battle for votes between the country’s four main political parties is heating up. A planned poster campaign by the rightwing People’s Party depicting the Swiss as “negroes” has sparked controversy amid accusations of racism. The poster, which was drafted by the party’s St Gallen branch, criticizes the government’s asylum policy.

More on this story here.


Business bank account that is designed for British expats.

Expats running their own businesses are being targeted with a new bank account from Lloyds TSB Offshore, which can be accessed over the internet. The new Overseas Company Club is a business bank account “designed especially for Britons living overseas who incorporate their financial affairs under the umbrella of a company or for businesses with offshore accounts”.

More on this story here.

Getting more for your money with a private bank.

Wealthy expats looking for something more from their bank should consider using the services of a private bank which offers a wide range of services. The entry level for each of the private banks is distinct and this, as much as the services on offer, could determine which bank you choose.

More on this story here.

Set your sites on advisers who make you feel secure

Expatriates looking for advisory services could do worse than pick a UK-based adviser as you know what level of regulatory protection you can expect, and many also have facilities that are accessible online.

More on this story here.

Mentor for those moving to or visiting China.

Malcolm Thorp moved to China four years ago and is willing to answer your questions about Shanghai. Whether thinking of transferring to China, visiting China as a tourist or in need of general information on the country, Malcolm is likely to be able to point you in the right direction. Ask questions and read the answers on the Mentor Noticeboard Shanghai.

More on this story here.

Make sure your details stay your business.

Expats using the internet to contact their banks or independent financial advisers should be sure there are minimum levels of security to keep their details safe. While more and more expats are finding the internet and email useful to manage their day-to-day financial needs, they should not become complacent about security.

While you should not worry unnecessarily, the risk of a security breach is very real, and it is best to know what security signs to look for before you start to manage your financial affairs online.

More on this story here.

Telegraph’s Expat Home page here.


After more than three years of dodging declining markets, money managers greeted a surprisingly bullish second quarter with sighs of relief. Markets everywhere moved up smartly. Indeed, every one of the 500 mutual funds managed outside the U.S. and tracked by BusinessWeek’s quarterly Offshore Funds Scorecard finished the quarter with positive returns. And more than 96% turned in double-digit gains for the quarter ended June 30. A look at the funds’ 12-month performance, of course, is more sobering: Only five of the top 25 had positive returns over a yearlong period. That is a reminder that quarterly performances can vary widely.

In the latest quarter, German and European equity funds came out on top, with funds focusing on German stocks taking six of the top 10 spots in the ranking. Some would say German equities had nowhere to go but up. They were 75% off their highs of spring, 2000, before the recent bounce. That made the stocks appear pretty cheap to value investors.

Offshore funds are typically based in tax havens such as Luxembourg and the Isle of Man and cannot be marketed to U.S. residents because they do not file reports with the Securities & Exchange Commission. But they represent the collective judgment of fund managers from around the world.

More on this story here.


On July 23rd the House of Representatives’ Committee on Financial Services proposed a law requiring investment firms to disclose commissions paid on the sale of mutual funds. Nine days earlier, state regulators in Massachusetts had charged Morgan Stanley with lying about the preferential terms given to brokers and branch managers for pushing the firm’s own products. The Securities and Exchange Commission (SEC) and the National Association of Securities Dealers are also said to be investigating.

The investigation into Morgan Stanley’s practices has big implications. The mutual-fund industry is a $6 trillion business, and the investigation raises two important questions about how financial firms sell their products. The first of these is whether, in selling a financial product, investment firms have a duty, like doctors and lawyers, to be truly objective in their advice. The second -- just as important, especially if the likelihood of objectivity is slim -- is whether customers should be made aware of the incentives that salesmen have to push one product rather than another. These the industry is reluctant to reveal.

More on this story here.


At present, taxes on hedge funds investments and investments in similar products are often avoided by purchasing the investments through a life insurance or annuity contract, which both enjoy favorable tax treatment. Under proposed rules taxpayers will no longer be able to hide their income from hedge fund investments behind these tax shields.

More on this story here.


When asked what defines “rich”, a lot of people say it means never having to worry about money again and working only if the mood strikes. Robert H. Frank, a professor of economics at Cornell and author of Luxury Fever, has noted in his work how wealth is perceived and defined in relative terms. He cites H.L. Mencken, who “defined a wealthy man as one who earns $100 a year more than his wife’s sister’s husband.”

Rich is not just a quantitative experience. It is a qualitative one. Money is great, but only if it contributes to your sense of well-being rather than detracts from it. How you choose to spend your money has something to do with how wealthy (or poor) you feel. If you are constantly confusing need with desire (desire to keep up, desire to have the latest and greatest, desire to show off), chances are you will never feel rich enough.

More on this story here.

High net-worth individuals seek financial advice during downturn.

There were an estimated 2 million high net-worth individuals (HNWI) in the United States at the end of 2002, according to a report from Merrill Lynch. However, that represents a decline of about 100,000 high rollers from the previous year.

“Their numbers and wealth were undermined by continued declines in U.S. equity markets,” said James Gorman, president of Merrill Lynch’s Global Private Client group. “However, the decline in their wealth was substantially less than the 22% drop in the value of the Standard & Poor’s 500 index over 2002, indicating that high net worth investors have strategies in place for wealth preservation.”

Assets under management by independent financial advisers who specialize in serving wealthy clients rose by 11% in 2002, with the median account size rising by 3.2% to $702,868. “It seems that during 2002, wealthy individuals whose portfolios had suffered at the hands of their brokers or because of their own poor judgment continued to turn to independent advisers for counsel,” said Kieran Beer of Bloomberg Wealth Manager magazine.

More on this story here.


The strongest attack yet on the Patriot Act is coming from the American Civil Liberties Union, but 309 House members have now joined the ACLU in opposing part of the terror-fighting powers granted to law enforcement by Congress shortly after the Sept. 11, 2001 terror attacks. “I think [law enforcement officials] are trampling on our rights and they are doing it in the name of trying to protect us from domestic terrorism,” said Rep. Butch Otter, R-Idaho.

Otter led the fight for an amendment to the State, Commerce and Justice departments' spending bill that passed the House last week. The amendment stops funding for so-called “sneak and peek” searches, where federal agents first conduct a search, then notify the suspect after the fact. If made into law, Otter’s amendment would prohibit the use of funds to ask a court to delay notice of a search warrant.

More on this story here.


Next time you book a flight to the United States, be prepared to leave your private life at the check-in desk. That, in effect, is what you will be expected to do as a result of sweeping new security measures. If you book through a travel agent, you might hear some bland talk of “the need for details of all bookings to be passed, of course, to the US authorities”. If you book online or by phone, you will probably give little thought to the small print on the website or the telephone-menu option on “what we do with your data”. It says something like this: “We are required by new laws introduced in the US and other countries to give border control agencies access to passenger data. Accordingly, any information we hold on you and your travel arrangements may be disclosed to the customs and immigration authorities of any country on your itinerary.”

Among that information is your passenger name record, or PNR, which includes your name, the date and time of your flights, the flight numbers, the destination and any stopovers. Depending on how you booked, and whether you are a regular customer, the PNR* can also include your date of birth, address, credit card numbers, emergency contacts and frequent-flier details. It may reveal information about your state of health (“uses wheelchair, can control bowels”) and, indirectly, your religion (“always requests kosher meal”) -- and it can list the cities and hotels you stay in regularly, the people with whom you stay, and whether you ask for one bed or two. It can, in short, lay bare a traveler’s life.

* In the words of Edward Hasbrouck, an American travel writer and campaigner on privacy issues, PNRs show “where you went, with whom, for how long, and at whose expense ... Particularly in the aggregate, they reveal trade secrets, insider financial information, and information protected by attorney-client ... and other privileges.”

More on this story here.


The IRS is seeking an attorney’s testimony and documents in investigating allegations of improper tax accounting at San Francisco-based Levi Strauss & Co. It is an attorney-client privilege case with a major twist: The attorney is a terminated Levi’s lawyer who is trying to give the IRS what it seeks.

Fenwick & West, on behalf of Levi, has filed a petition to quash the IRS summons in U.S. district court in San Francisco. Levi Strauss & Co. v. United States of America, No. C 03 3212 MMC (N.D. Calif.). The petition asks the court to set up a procedure for viewing documents and hearing testimony in camera to determine what information may be privileged.

“We believe the documents were stolen, and an attorney-client privilege is not waived for stolen documents,” said James Fuller, a tax practice partner for Fenwick & West.

More on this story here.


The Pentagon office that proposed spying electronically on Americans to monitor potential terrorists has a new experiment. It is an online futures trading market in which anonymous speculators would bet on forecasting terrorist attacks, assassinations and coups. Traders bullish on a biological attack on Israel or bearish on the chances of a North Korean missile strike would have the opportunity to bet on the likelihood of such events on a new Internet site established by the Defense Advanced Research Projects Agency. The initiative, called the Policy Analysis Market, is to begin registering up to 1,000 traders on Friday.

The Pentagon called its latest idea a new way of predicting events and part of its search for the “broadest possible set of new ways to prevent terrorist attacks.” Two Democratic senators who reported the plan called it morally repugnant and grotesque. The senators said the program fell under the control of Adm. John M. Poindexter, President Ronald Reagan’s national security adviser.

The senators also suggested that terrorists could participate because the traders’ identities will be unknown. “This appears to encourage terrorists to participate, either to profit from their terrorist activities or to bet against them in order to mislead U.S. intelligence authorities,’ they said in a letter to Admiral Poindexter.

More on this story here.


July 11th earned the dubious distinction as “Cost of Government Day” for 2003, the date when the average American has worked enough in the calendar year to pay for government at the federal, state, and local levels. In other words, most Americans turn over more than half of everything they make to government -- in taxes, fees, and in the form of regulations that increase the price of goods and services. The good news for Americans is that the Cost of Government day is finally behind us for the year. The bad news is that the day keeps falling later and later, in fact 17 days later than 2000.

Only during World War II -- a momentous event requiring a huge mobilization of men, machinery, and supplies -- did the federal government consume more of the nation’s productive economy than it does now.

Of course both Congress and a succession of presidents are responsible for the spending mess. It is easy to talk about smaller government, but few actually vote against the 13 annual appropriations bills that fund so many wasteful and unconstitutional departments, agencies, and programs. There are simply too many special interests counting on the money contained in the appropriations bills, and those same interests will take their campaign contributions elsewhere if a congressman fails to play the game.

The American people are also responsible for the growth in government, however. We have allowed our constitutional republic to deteriorate into a virtually unchecked direct democracy. Today’s political process is nothing more than a street fight between various groups seeking to vote themselves other people’s money.

More on this story here.


Police have to make sure they follow strict guidelines on undercover tactics. They cannot entrap people into committing crimes they would not otherwise have committed. This is where “Operation Cotton” ran into trouble.

According to the judge at Southwark Crown Court, they were offering a wholly exceptional money laundering opportunity. They could guarantee its success because they were running it and this made it different from other sting operations.

More on this story here and here.

U.K. law agencies need clear money laudering rules, says minister.

Caroline Flint, in charge of measures against money laundering, hinted at concern in government that attempts to combat the trade could be hindered if the hands of the police were tied too tightly. Without referring directly to the collapse of the Gibraltar case at Southwark Crown Court, she said: “Organized criminals are sophisticated and that presents a big challenge to the police ... police need to be three steps ahead and have the ability to prosecute successfully.”

The current system for tracking reports of suspicious transactions was falling short of its aims of deterring money-laundering, she said. There were serious failings in the way transactions were being investigated.

More on this story here.


Eavesdroppers, including stalkers and jealous spouses, are listening in on hundreds of thousands of private conversations in Britain every week because of a legal loophole. Telephone tapping without a valid warrant is illegal under both the 1998 Wireless Telegraphy Act and the Regulation of Investigatory Powers Act 2000.

The law relating to intrusive surveillance devices -- bugs -- is less clear. But it is legal to trade in taps, bugs and covert cameras, which explains the myriad websites, mail order businesses and spy shops. Their customers include businessmen, private investigators, suspicious spouses and even stalkers.

Conservative spokesman on home affairs, Patrick Mercer, said this loophole needed to be closed and people should need licences to buy any covert surveillance device.

More on this story here.

A-Z of Secret Britain.

The laws relating to secrecy and privacy in British life are numerous and some of them often appear to contradict each other. BBC News Online offers a glossary of laws and agencies governing “Secret Britain”.

More on this story here.


UK Prime Minister Tony Blair knocked the wheels off Home Secretary David Blunkett’s ID card bandwagon, citing “huge logistical and cost issues that need to be resolved” before the cards can be implemented. If words such as “privacy” and “freedom” also figured in his reasoning he neglected to share them.

In the long run he thinks there is a case for Britain “moving towards a system of ID cards.” And that phrasing effectively runs the curtain down on any kind of big bang, compulsory rollout. Which, perhaps, sets the government back on the road to sanity.

More on this story here.


The US Treasury’s success at cracking down on offshore tax shelters was called into question on after it was revealed that a much-touted amnesty program had so far recovered less than $1 million in unpaid tax. The program, which the IRS hoped would bring in $100 million, has an estimated cost of $56 million.

The IRS disputed the findings, saying the campaign had been “productive”, and that it had collected about $75 million as of last week through the Offshore Voluntary Compliance Initiative, as the amnesty scheme is known, and by examining individual taxpayers. The IRS did not specify, however, how much of that money resulted directly from the program.

More on this story here and here.

“Offshore Tax-Avoidance Schemes and IRS Compliance Efforts”, straight from the horse’s mouth, here.

IRS indictments target O’Brien Group tax service.

SAN DIEGO: A 78-count indictment was handed down today against eight Southern California residents in an alleged tax evasion scheme. The indictment targets The O’Brien Group, which ran businesses that provided tax-related services to clients.

One of the group’s customers was accused of of evading taxes while operating the Grand Animal Hospital in San Diego. The customer and his former girlfriend created a trust, received income in a fictitious name, concealed assets and income, skimmed cash receipts and made false statements to the IRS, an IRS special agent said.

More on this story here.


Bermuda’s new Cabinet was finally sworn in on Wednesday, almost a week after a general election which saw the government hamstrung due to a revolt by members in the ruling party. Former Premier Jennifer Smith resigned on Monday after half the lawmakers in her center-left Progressive Labor Party refused to serve after their election victory because of her secretive leadership style.

New Premier Alex Scott took office on Tuesday, promising to unify both the PLP and the wealthy, low-tax island where there is still racial tension between the black population, which makes up 60% of the 62,000 residents, whites, and foreigners working in the offshore financial sector.

More on this story here.


The IMF has published the results of its 2003 article IV consultation with the Bahamas, in which it praises the jurisdiction’s previous economic management, but warns of significant challenges ahead and slower than anticipated economic growth.

More on this story here.


Battered and bruised by falling markets, attacks on bank secrecy, tax amnesties and threats from up-and-coming financial centres, many observers predicted the end of the road for Switzerland as a model of wealth management. For its hundreds of large and small private banks, the last three years have been some of the toughest ever, forcing drastic cost cutting and restructuring measures, including mergers and joint ventures.

But despite constant pounding, Switzerland, home to a third of the world’s offshore wealth, is clinging to its title as the global hub for managing the fortunes of the seriously rich -- at least for now. “Talk of the death of Swiss private banking is utter nonsense, but it will change dramatically in response to regulation and tax pressures on the international stage,” said the director of a London-based consulting firm.

More on this story here.

Private banking seen shifting to Asia.

A change in banking secrecy and tax laws in Europe is causing wealthy investors to shift their money to Asian offshore centers like Singapore and Hong Kong, according French-based SG Private Banking. The move was partly behind the 30% growth in Asian (ex-Japan) assets under management seen by the end of June from a year earlier, SG Private Banking Asia-Pacific Chief Executive Officer, Daniel Truchi, told Reuters in an interview.

More on this story here.


An annual survey released by the Hong Kong Securities and Futures Commission (SFC) this week has revealed that the territory has maintained its position as a major fund management center in the Asia Pacific region. According to the SFC’s figures for last year, total assets under management grew 0.4% to $1.49 billion. Of these, some 37% were derived from Hong Kong investors, a jump of 23% compared with 2001.

More on this story here.


Singapore said it planned to tighten anti-money laundering regulations as consultancy firm PricewaterhouseCoopers said the city state was an attractive destination for money from criminals. A U.S. state department report issued last year named Singapore as a country of “primary concern” for money laundering in a list which included Britain, the United States and Hong Kong.

PricewaterhouseCoopers said an estimated $200 billion of illegal funds from drug trafficking, tax evasion and other serious crimes were laundered annually in the Asia-Pacific region.

More on this story here and here.


The Cypriot Finance Ministry has hit back at a recent Financial Times report which claimed that the EC has identified nine harmful tax breaks given to businesses in Cyprus. Although the Cypriot government acknowledged that the nine areas of concern did exist, it stated this week that the measures in question have been abolished as part of recent taxation reform.

More on this story here.


Lawmakers on urged the government to abandon a controversial plan to share sovereignty over Gibraltar. A cross-party parliamentary committee on foreign affairs said the government should focus instead on promoting cordial relations between the British territory and Spain. The people of Gibraltar overwhelmingly rejected shared sovereignty in an unofficial referendum in November.

In addition, the U.K. has proposed that Spain relax border controls between Spain and Gibraltar in return for the Rock’s full participation in the European Union.

More on this story here and here.

Youth spent in Gibraltar inspires hit play.

Two years ago Gregory Burke had an overnight hit at the Edinburgh festival with Gagarin Way. He describes how growing up in Gibraltar inspired his new play.

Excerpt: “Gibraltar’s historical and psychological sense of itself is rooted in the idea of being under siege. The rock is riddled with fortifications and scars from and monuments to innumerable conflicts. Patriotic reminders of Britain’s martial past are on every corner. Gibraltar isn’t physically an island (it’s an isthmus), but it is psychologically adrift from the continent it is part of -- just as Britain is psychologically adrift from its continental shelf (or should that be self?).”

More on this story here.


For years, the IRS has brought lawsuits to invalidate the generous tax breaks claimed by family limited partnerships -- popular vehicles often used to pass wealth to younger generations. And for years, the IRS has had little success. But in May, the tax man’s luck changed, when a U.S. tax court rocked the quiet world of estate planners by declaring tax breaks off-limits to a Texas partnership.

The court did so on the grounds that its donor had retained too much control over key decisions, such as the distribution of money among partners. “For a lot of people who set these up, maintaining control is very important,” says Joanne Johnson, managing director at JPMorgan Private Bank in New York. “But now, they may have to compromise on that control.”

More on this story here.


Stunned by the public outcry against auditors and the flurry of shareholder lawsuits and regulatory probes, major accounting firms have been struggling since then to reshape themselves. They have improved training for auditors, backed away from some types of businesses and started to craft new kinds of relationships with clients.

A look into the operations of one of the influential Big Four accounting firms, Ernst & Young LLP, illustrates that a number of changes in the audit process are working as lawmakers had hoped. Ernst’s experience also reflects how difficult it can be to try to shift gears in a mammoth company at a time when new rules are not yet written, key court cases have not been decided and scandals keep erupting.

More on this story here.


The debate over revaluing the Chinese yuan is gathering steam. At its current fixed rate of 8.28 per U.S. dollar it may be undervalued by as much as 30%. Many in the West argue that the Chinese, by keeping their currency artificially cheap, are ruining other nations’ ability to compete in global trade and building up a dangerously large foreign currency reserve. Chinese officials, politely but firmly, have basically told the West: Get lost. China’s domestic economy needs to soak up millions of jobless workers and recover from the ravages of SARS. Cheap exports are vital in this exercise. No way is a major revaluation possible.

Don’t fixate on the high-level chatter of the world’s finance ministries. Rather, look at what ordinary businesses and individuals in China are doing -- that is, at the day-to-day flow of money across China’s ever more porous border. In this realm, stockbrokers, fund managers, corporate executives, and currency traders are all betting on a revaluation by pouring money into the country. The very weight of all this money will force officials to act, analysts say, or risk unbalancing China’s domestic economy.

More on this story here.


Europe ranks as the most expensive region in the world in the latest survey by a prestigious London research group, the Economist Intelligence Unit. Seven of the world’s 10 most expensive cities are in Europe, according to the report. Tokyo and Osaka remain on top of the list, as they have for a decade. Hong Kong ranked fifth.

The editor of the report, Bill Ridgers, said strong European currencies, led by the euro, account for the continent’s high cost of living. The relatively cheaper dollar caused New York City to drop out of the top 10. It now ranks as the 13th costliest city.

More on this story here.


The head of Congress’ investigative arm, in a highly unusual move, will issue a stern warning to the American public that the U.S. economy is facing “a large and growing structural deficit” that requires dramatic action and tough choices to curb.

“My son ... was a Marine Corps company commander in Iraq, and I actually have less concern about him being in Iraq in that capacity than I do about what the future may hold for him and his new daughter because of this fiscal imbalance, because at least in Iraq he had some control over his own destiny,” General Accounting Office head David M. Walker told United Press International.

More on this story here.


Slowly but surely, it is dawning on the public and the experts. New Labour’s return to the big spending style of the pre-Thatcher era is not working. Unfortunately, Tony Blair’s administration is refusing to recognise this reality. Having already hit middle Britain with large-scale tax increases which came into effect in April, it is grubbing around looking for new stealth taxes to pay for its poorly executed expansion of government.

All it has successfully achieved so far is a huge increase in the regiments of public sector workers which almost exactly parallels the shrinkage in the wealth-creating manufacturing sector of the economy.

More on this story here.


In June, Annette Carson, who lives in South Africa, lost her case challenging the government’s expat pensioner policy at the Court of Appeal in London. Although the Court of Appeal refused Ms. Carson a right of appeal, she has now applied to the House of Lords’ Appeal Committee for permission to challenge the decision.

Ms. Carson is among an estimated 490,000 British pensioners who live overseas and have had their pensions “frozen” at the rate they were first paid abroad.

More on this story here.


Only a day after it was disclosed, outraged senators of both parties for the immediate end to the online trading bazaar that would have rewarded investors able to predict terror attacks and other global unrest. Pentagon officials raced to oblige, saying it would be shut down posthaste.

Until Virginia’s John Warner, chairman of the Armed Services Committee, persuaded his counterparts on the Senate Intelligence and Appropriations committees to join him in telling the Pentagon to pull the plug on a government-funded terrorist futures market, the Bush administration was actually planning to encourage speculators to bet on the next Sept. 11 atrocity.

More on this story here and here.


The American Civil Liberties Union joined several Islamic and Arab American groups in filing a legal challenge to a key provision of the USA Patriot Act, which allows the government to seize business, library and computer records in terrorism investigations without publicly disclosing that it has done so.

The lawsuit, filed in federal court in Detroit, argues that the law violates free-speech rights and constitutional protections against unreasonable searches and seizures. The plaintiffs, including a Michigan Islamic group and an Oregon mosque, also allege in the lawsuit that they have been targeted for investigation by the FBI because of their ethnic and religious characteristics.

More on this story here and here.


Representatives of the FBI have met at least twice in the past three weeks with senior officials of the Federal Communications Commission to lobby for proposed new Internet eavesdropping rules. The FBI-drafted plan seeks to force broadband providers to provide more efficient, standardized surveillance facilities and could substantially change the way that cable modem and DSL (digital subscriber line) companies operate.

The new rules are necessary, because terrorists could otherwise frustrate legitimate wiretaps by placing phone calls over the Internet, warns a summary of a July 10 meeting with the FCC that the FBI prepared. “Broadband networks may ultimately replace narrowband networks,” the summary says. “This trend offers increasing opportunities for terrorists, spies and criminals to evade lawful electronic surveillance.”

More on this story here.


In a move that has outraged civil rights advocates, Russian intelligence services have gained access to millions of private cellular telephone conversations, claiming national security interests. At least three times over the past year, Russian officials have ordered cellular telephone providers to switch off their encryption systems, thereby allowing the Federal Security Service -- the KGB’s main successor -- or other agencies to listen into calls.

The switchoffs were not announced and phone users were alerted to them only by the appearance of unfamiliar, and easily ignored, icons on their phone screens.

More on this story here.


The Senate Banking Committee approved legislation to ban credit card and other types of electronic payments to offshore casinos. Passed on a vote voice with no debate, the Unlawful Internet Gambling Funding Prohibition Act (S. 627) carries criminal penalties of up to five years in prison for violators. A similar version of the bill has already been passed by the House of Representatives.

The bill creates a new crime of accepting financial instruments, such as credit cards or electronic fund transfers, for debts incurred in Internet gambling. Also, because the operators of Internet gambling sites are off-shore and beyond the reach of U.S. law enforcement tactics, the legislation enables state and federal attorneys general to request that injunctions be issued to any party, such as financial institutions and Internet service providers, to assist in the prevention or restraint of the new crime.

Despite current laws, Americans are driving the growth of online gambling sites, which grew from about two dozen sites in 1995 to almost 2,000 locations in 2002. Last year, the sites are estimated to have pulled in more than $4 billion in revenue.

More on this story here.

PayPal settles over gambling transfers.

The online payment service, which is now owned by eBay, will pay the U.S. government $10 million to settle allegations that it knowingly transferred funds to unlawful offshore gambling sites. The $10 million settlement represents what both parties agreed represented forfeitable revenue that PayPal obtained from processing the gambling transactions.

More on this story here.


As Europe mulls the idea of implanting radio chips into euro notes, Japan has gone a step further with plans to incorporoate the controversial technology in currency that will enter circulation next year. New 10,000 Yen bills (worth about £51) currently entering production are to be implanted with IC chips from Hitachi in a bid to combat counterfeiters and money launderers, according to Japanese reports.

More on this story here.


Facial features are most likely to be the unique human characteristic that will be introduced in the Singapore passport, because the International Civil Aviation Organization (ICAO), the world’s authority on airline travel, favors using facial features over eye scans and fingerprints. The ICAO identified the features of a face as a primary biometric identifier over iris scans and fingerprints, which are viewed as secondary identifiers.

More on this story here.


American expats were issued a fresh terrorism alert Tuesday, the same day that the US government warned of new September 11-style plane hijackings. The US State Department urged American citizens living abroad to maintain a high level of vigilance, to remain alert and “take appropriate steps to increase their security awareness”.

It said terrorists could launch suicide operations, hijackings, bombings or kidnappings at facilities where Americans and other foreigners congregate or visit. And for the first time, the alert said attacks “may also involve commercial aircraft”.

For more information on terror warnings, visit http://travel.state.gov.

More on this story here.
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