Many company founders and shareholders of offshore companies are faced with the ever increasing demands of the banks. In most cases, a company without a bank account is essentially useless and pointless, which is why it is so important that not only the incorporation, but also the opening of the bank account should be supported by professionals.

bank accountThere have recently been changes in international money laundering laws, making the opening of corporate bank accounts more and more complicated, as a result it has become essential to employ a specialist company for this. To summarise the changes, a company’s business activities were previously not examined too much. Now, a company, or trust, wanting to open a bank account, has their business activities closely scrutinised by bank compliance departments.

The most recent international money laundering laws insist that banks have data to support the business activities of the client’s company, not just state the business activities. Here are 2 fictitious illustrations:

1. SAMPLE INC. is an IBC company in Belize. The company currently trades via another company, based in Europe; because of an increase in export business, they decide to trade as an IBC company (i.e. an offshore company) to make the most of (legally) using an IBC company to trade over international borders, without incurring corporation tax or VAT. The company has been in business for several years, so evidencing corporate activities is not difficult. The company has a website, so by conducting a Google search, a bank’s compliance department can check that the account application is authentic and conforms to the bank’s internal rules, by viewing the company’s products and services online. Alternatively, evidence could be provided by providing previous customer contracts or similar, if the company did not have a website.
As long as the company’s activities are in accordance with bank policy, the bank should open the account without any problem. It may seem odd, but international banks are not too worried about the private financial affairs of a company’s directors or beneficial owners. Thomson Reuters World-Check, a financial intelligence service providing evidence of past criminal or terrorist activities by a bank account applicant, is used by the bank to carry out the main checks. Excluding this, no other checks take place, not even a check for credit scoring.

2. The second company is a new business, with no company website or record of previous business activities. As a new company, we can assume that the owners have created a business plan or similar. In order to open an account for this company, a copy of the business plan will be sent to the bank, together with a copy of the résumé of the company’s beneficial owner(s) or shareholders. By providing this information, the bank will have a good idea of the company and its planned activities.
The reason why banks are now searching further into their clients’ business activities? Most application forms now require more detailed information about the client’s services or products; they also want to know the estimated turnover and the countries where the business will operate. The first company, “SAMPLE INC”, for example, will state on the bank application form that they will sell widgets in the South America, Russia and also Europe, and that the estimated revenue will be 150,000 US$ per month. If, after the account has been open for 3 months, 300,000 US$ is suddenly transferred into the bank account from Asia, this transaction will be flagged as unusual by the bank’s compliance department. The reason for this is that the funds are much greater than those stated on the initial bank application form; they are also from a different country from those stated on the application form. The compliance department of the bank will pick up that this is possibly a form of money laundering. The bank will subsequently suspend the account until they are satisfied that this is a genuine transaction. The bank will, at the same time, contact the client to request further details about the transaction. This action could take a few days, or it could be several months before the investigation of the origin of the funds is completed.

Now you will probably realise why it is no longer a straightforward process to open a bank account – it is wise to give the task to the professionals. GWS is a licensed banking specialist; we are licensed to several international banks. Our administration and advice team are fully acquainted with our banks’ requirements, enabling the seamless opening of your bank account.

Unlike our competitors, we provide more than just companies; we offer our clients a complete package, including company and bank account, plus a nominee director who is a professional trust company, and also a full nominee shareholder service.

Many competitors provide their customers only with empty account contracts, so it comes to no surprise that the customer receives a company that was incorporated in due form but no bank account. That is precisely the reason why we guarantee a bank account for any and every reputable and legal business.