One of my clients today asked me about reporting of offshore (foreign) bank accounts. I reminded him that if you have $10,000 or more at any time in a foreign bank account or accounts, they must be reported by checking the boxes on Schedule B and by completing Form TD F 90-22.1 and mailing that form to the Department of the Treasury. The penalty for not reporting starts at $25,000. You can find yourself serving hard jail time if you don’t report them. The anti-money laundering statute has real teeth.
My client wisely agreed that reporting his foreign bank account was the right thing to do.
Of course, when I get home and check my email, I see this:
Dear ColleagueGullible Victim,
Thank you for your interest in our offshore fund products. The [deleted] Fund (Cayman) is a product that is attracting attention worldwide.
Offshore advisers and consultants are attracted to the product because it offers their clients exposure to private equity and because it pays significant cash commissions and the opportunity to participate in the profits of the fund manager.
Scam Highlights
Class A private equity shares target 20% to 25% annual returns
Class B shares provide a guarantee of principal by a financial institution rated AA by Standard and Poor’s with a term of five years and a target return of 12% to 15% per annum
Commissions paid to consultants and advisers are from 4% to 6%
Trailer allows you to participate in the profits of the manager for five to ten years
Class “A” Private Equity Shares are designed to provide sophisticated investors the opportunity to invest in a private fund that invests in some of the most promising alternative asset managers using a high growth strategy. The minimum initial purchase for Class A Shares is US$50,000 with a target return of 20% to 25% per annum.
Class “B” Capital Guarantee Shares are designed to provide investors with exposure to private equity without risk to capital. The Class B Shares also have a defined redemption date with a specified return rate. The minimum initial purchase for Class B Shares is US$50,000. Class B Shares shall be redeemed by the Fund in year five at a redemption price of 175% (75% over the original price).
If offering this product is of interest to you, please review the materials that can be found on the following link: [deleted]
We believe once you have read our materials and understand our fund model you will see the economic possibilities are substantial.
We look forward to your response.
Sincerely, [deleted]
In case you’re wondering, I didn’t request information on these offshore funds. I love how they say they’re targeting a 20% to 25% return. We all want a 20% to 25% annual ROR on our investments. The lack of comments such as, “Our Scam1 Fund returned 38% last year,” shows that the operators are becoming more sophisticated.
Now, it’s always possible that this fund is legitimate. Really….
