The financial failure of the ABLV Bank gave me plenty to think about once again. How fragile the financial system still is to this day, and how we the clients are all at the mercy of the banks. Some of our acquaintances and clients almost certainly lost a significant amount of their money when the Latvian bank went down. And it’s not the first time: 5 years ago the bankruptcy of LAIKI Bank sent shockwaves through the European business world. At this stage, some of the experts start trying to explain what we did wrong, and what we shouldn’t do now. I would rather concentrate on what we should do if we want to avoid similar situations in the future.
At the beginning of 2018 a number of banks, who had not already done so in the second half of last year, hurried to send out the Common Reporting Standard (CRS) forms to companies – particularly foreign ones – holding accounts with them. To be precise, the form was a data sheet in which the representative of the company „provides assistance” to the bank, on a self-assessment basis, in satisfying the CRS requirements. By comparing the information on teh data sheets with the data already held on their own files, the banks decide which person, or people, they will send a report, or reports, on, in connection with a given company.
Just eighteen months ago when the Panama Papers were released, we published the LAVECO Newsletter with the following headline: Panama Papers, Bahamas Papers, UK Papers, Germany Papers, USA Papers, ...........? What I wanted to imply in the title was that there would be a follow-up to the Panama Papers, and true enough less that one and a half years later, the second “instalment” was released.
Autumn is upon us, and we are publishing the latest edition of the LAVECO Newsletter. Our leading article tackles a question which has been relevant for many years and is still relevant today: is it worth having a foreign company and bank account in the era of information echange? Is it worth holding money in a foreign bank account? Which is better, accumulating, or spending everything straightaway? Of course, rather than giving the definitive answer, we try to offer guidance fpr further thought, taking into consideration the situation of the modern world economy.
A study published by the „experts”/journalists of the Tax Justice Network (TJN) in 2011 claimed that between 21 000 and 32 000 billion dollars is either hidden, deposited or invested in the various Offshore Financial Centers (OFC). This is the amount which the „experts” at TJN estimate has been accumulated in jurisidictions from Switzerland to the Cayman Islands over the last 50 years.
The second edition of LAVECO’s 2017 Newsletter can’t compete with the benefits offered by the summer, but I’m sure it will contain one or two thoughts which may be worth pondering over as you kick pebbles on the beach.
I have to start with an apology: the title of the article is extremely misleading. The process began some time ago, is still ongoing, and will probably never come to an end. The reason behind this is the speed with which the internet has „invaded” every day, hour, minute and even second of the average person. Because an awful lot of us now begin the day by reaching for our mobile phones to see what messages we received from friends or business partners while we were asleep.
New year, new thoughts! The leading article of the first edition of the LAVECO Newsletter for 2017 analyses the trends in the international company industry with regard to both consumers and service providers. We draw your attention to 3 significant moments in each case which will define the year. 2017 will be the year of purges on both sides, with clients and the service providers who serve them being affected.
