What comes as news to many clients is how secretive people are allowed to be with their assets right here in the U.S. Sometimes we find that the distinction between accounts in an overseas tax haven and one in certain American jurisdictions is meaningless until you have a court order.
That’s why, when we are asked to do an asset search, we always ask whether the person contacting us is in litigation. If not, then finding indications of a bank account in the U.S. may not get you much more information than the same information about an account in Bermuda.
It doesn’t mean you shouldn’t look. It’s just that without a court order, you won’t be able to get any useable banking information legally.
The distinction changes once courts get involved. Then, it’s easier to break open the details of a bank account or even companies in Delaware. Overseas, you can get into the details in many tax havens, but it can be hellishly expensive. Only a very few of our clients have ever litigated in the British Virgin Islands. You need hundreds of thousands or sometimes, millions of dollars to be at stake to start spending the kind of money it takes to go to court in some of those places.
Lawyers who hide assets in such places admit as much. The goal is to make identification so expensive that those looking will often want to cut a deal before spending all those legal fees. Another good reason to look onshore first.
Always a Question of “Which Jurisdiction?”
Just as offshore havens vary widely in the information you can get with and without court orders, so it is in the U.S. For example, Florida offers a lot of company information online, but in Delaware you can pay to have someone form and administer your company with a professional address. There will be no link to you in any publicly available information until you present the Delaware Secretary of State with a court order.
Unless of course (and we’ve seen this) the person didn’t go to the small extra expense of having the company incorporated for him. If he did it himself, you can get the documents that link him to the company. It may cost a few hundred dollars, but in high value cases it’s always worth looking for all the public documents in Delaware just to make sure.
Finding the Clues
What are the best ways to get a sense of what assets may be hidden offshore? The same way you look for Delaware companies or anything else in the U.S. Three of the big ones are:
- Litigation. If your person did business with a bank, another person or company and things went wrong, he may have been sued. Even if he was doing business using the secret company, he could have been sued personally as well. That often happens if a borrower has to offer a personal guarantee for debt his new company takes on.
- Property. This can mean anything someone owns, but we especially like to look for real estate. Take every address you can associate with the person, and see who or what owns that property. Even if your man is renting, he may be renting from a company he controls. If your search for a landlord or owner ends at a lawyer’s door in Lichtenstein or a BVI company registered in Hong Kong, you’re getting warmer.
- Liens (called “charges” in many British-controlled jurisdictions). This is a search you can get done without a lot of money, but you need to know the name of a company to look at. Sometimes mysterious companies show up in someone’s email or on their computer hard drive. Finding out to whom your person owes money can lead to an interview with the creditor and lots more information.