Recent messages have focused on Ponzi schemes but there are other types of scams to watch out for as well, such as offshore trust IBC scams.

Some offshore trust IBC scams are ripoffs that offer overseas pure trusts, others offshore banks, some international business corporations (IBCs) or some other similar structure. We have been warning about the dangers of offshore trust IBC scams for years! In January 2001 this site outlined the dangers of offshore trust IBC scams by saying:

Offshore Trust IBC Scams Warning

“Our business has been on the forefront of using international structures for years, both in investing and in using overseas structures. We were using promoting and managing Cayman, Panama, Isle of Man companies decades before they became a rage. We were in Belize almost 20 years ago. What we used to be able to do legally was amazing, but slowly legislation eroded what can be done for most individuals unless they have really large businesses or estates.

“Unless you plan to do business out of the U.S. or have volumes in the many millions, an IBC won’t accomplish a thing, nor will an overseas trust. The rules have become so complicated and compliance so onerous that I have shut down all my overseas structures long ago.

“There are so many scam operators in this business now that you really have to beware. Using them actually makes it more dangerous and visible than not for the peculiar reason that the IRS had toned itself down within the U.S.

“The IRS has soften its stance very much in the US but because of this, to raise revenues they have hardened their focus on overseas structures, especially on promoters of such structures. I have seen several of my readers get in trouble just because they used the wrong promoter.

“If someone offers you a pure trust, constitutional trust or contract trust be especially careful. It might indeed mean a trust that does not comply with US tax regulations. This could lead to trouble!”

Now we can see great proof of how dangerous the fraudulent structures are in an ezine by David Ingram who writes aboutJerome Schneider,a man who promoted phony offshore banks for years. The Feds chased Schneider for some time and because he was a Canadian it took them longer than usual to shut him down. However they prevailed and you’ll see the horror story of his customers in Ingram’s ezine.

Offshore Trust IBC Scams Explanation

Ingram’s ezine comes right after this ad below:

Advertisement:

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My novel the 65th Octave provides an enjoyable way to learn about fraud and scams. The hero is a scam catching expert working for big banks. The book outlines why scams work and why suckers always lose. I recommend you read the book. It has some in-depth economic information but is also a fast paced, fun read. Order the 65th Octave at GaryScott.com

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Here is David’s ezine about the Jerome Schneider fraud:

“David, If an American citizen had a consulting company incorporated offshore, bu the work was all in the U.S., would it be beneficial to become a Canadian citizen?

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” David ingram replies: – Short question – long but important answer

“An American Citizen Must file a US tax return every year they are alive no matter where they live, no matter where the money is coming from and no matter what other citizenships they might have.

“Watch out for OFFSHORE corporations as well. Jerome Schneider who set up as many as anyone else over a 12 year period, was recently convicted. As part of his plea bargain for a lesser sentence, he turned in over 1,000 clients he had set up. You can read the full story at Quatloos.com

“In his plea bargain, Jerome Schneider (who used a lot of “my” material inappropriately) agreed to pay a restitution of $100,000 (supposedly all he had left after millions of fees and more importantly turn in all the clients, their lawyers, bankers and anyone else involved. You an read his plea bargain here.

Quatloos.com

“I attended one of his seminars at the Waterfront Hotel and found it joke. Also spotted a whole bunch of my material in his handouts. It was obvious that the material had come from my faxed monthly newsletters from Oct 93 to August 1998. He was a paid subscriber at $125.00 per year.

“In addition, if you have an offshore corporation, you are liable to file a form 5471 each year. Failure to file the 5471 form (which makes all the internal finances of the offshore corporation part of your 1040 Income tax return) can accrue a fine (per year) of $10,000 for the first 90 days and $10,000 every 30 days thereafter. Note that this fine does not require the corporation to have made a profit or even done any business. It is a parking meter type of fine for being the proud owner of an OFFSHORE (Canada and Mexico are offshore for this purpose) corporation and not reporting it to the IRS. Over 1,000 of Jerome Schneider’s clients can expect major fines form this because he was advising them NOT to file the form.

“In addition, if that Offshore corporation (or just you) have signing authority over foreign accounts totalling $10,000 or more, you need to file forms T DF-90.22 for each bank account you have a signing authority over. This would include a trust fund you have set up in Canada for your grandkids’ education or a church or boy scout account if you could sign them.

“Failure to file form T DF-90 to report the bank account for your offshore corporation can earn a fine of up to $500,000 PLUS five years in jail,

“Should you become a Canadian? EVERYONE should become a Canadian. Canada is a great country with everything good that the US has plus more. You have everything to gain and NOTHING to lose in becoming a Canadian.

“However, becoming a Canadian does not save you any income tax as long as you remain a US citizen. You will still have all the Income tax liabilities you have now.

“We had a 105 year old lady with a $10,000 fine for not filling in form TD F-90.22

“A 68 year old lady had a $60,000 fine.”

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YOU ARE WARNED! Watch out foroffshore trust IBC scams. They do not eliminate tax and can lead to all types of trouble!

David is a CPA who lives in Canada and I had the good fortune to meet him some years back. I have watched his very prolific writing since that time and he is a wealth of tax information regarding the U.S., Canada UK and more. His website is Centa.com

Until next message good investing and business!

Gary

P.S. You can learn about the correct way to gain the Ultimate Loophole, The Circle of 100, at our upcoming international business and investing course in Ecuador. Details are GaryScott.com

Order the 65th Octave at GaryScott.com

Sometimes one picture is worth a thousand words

scams

To avoid scams balance yourself in nature like this cabin at Gary and Merri Scott’s Merrily Farm where you are welcome to visit and stay Little Horse Creek.