April 5's report ("Leaked papers reveal tax secrets of Asia's elite") evoked fears across countries where depositors use offshore financial centres (OFC) for legitimate businesses.
The worries of governments are linked to shady transactions that implicate anonymous account holders in money laundering activities, the financing of terrorism and tax evasion issues.
Many account holders create shell companies to circumvent tax and government stamp duties on their transactions.
OFCs such as the Bahamas, Bermuda, British Virgin Islands, Cayman Islands, Panama, Luxembourg, Dominica and Switzerland are established places that provide alternative banking services for commercial and corporate consumers.
Naturally, questions will arise when a government official is found to hold personal accounts in an OFC.
Likewise, any prominent businessman who uses the services of an OFC will invite unwanted attention from tax officials.
I have some questions about the law in Singapore.
- Is it legal to have an overseas banking account with an OFC?
- Can a public servant open an OFC banking account?
- Must everyone who has an OFC banking account declare it to the Monetary Authority of Singapore?
George Lim Heng Chye