american international holding llc © 2006 american international depository & trust 2006 caib...

American International Holding LLC © 2006 American International Depository &

Trust

2006 CAIB Conference2006 CAIB Conference Trinidad, November 17thTrinidad, November 17th

Opportunities in Onshore Banking for Non-US Families and their companies vs. Operating in the New World of Offshore Banking

Colorado Foreign Capital Depository

The Incorporation of the USA Patriot Act Provisions in the Regulatory Regimes

of the Region


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American International Depository & Trust is:

An International Private Bank and Trust chartered under the Foreign Capital Depository Statutes of the State of Colorado, and

The first and only Foreign Capital Depository within the U.S. strictly legislated for the benefit and protection of non-citizens who are non-residents of the U.S.


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US PATRIOT ACT of 2001

Section 5318 (i) requires U.S. financial institutions to establish due diligence policies, procedures, and controls reasonably designed to detect and report money laundering through correspondent accounts and private banking accounts that US financial institutions establish or maintain for non-US persons.


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ENHANCED DUE DILIGENCE

• Enhanced & Extraordinary Due Diligence Required

– U.S. Patriot Act requires any U.S. bank with accounts from non-U.S. persons or non-U.S. residents that require a minimum deposit of at least $1 million to establish appropriate, specific, & “enhanced” due diligence polices, procedures, & controls to detect & report instances of money laundering

– Colorado law requires the Bank to exercise “extraordinary” diligence to determine the genuine identity of a customer


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Know Your Customer

• To make reasonable efforts to determine the true identity of potential customers.

• To take particular care to identify ownership of all accounts and those using safe custody facilities.

• To take reasonable steps to be aware of any unusual transaction activity.


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Anti-Money Laundering-Laws and regulations are changing on a daily

basis--Know Your Customer

--Ascertain the source of funds

--All crimes are indictable, not only those related to drug dealing

--Financial intermediaries included

--Compulsory reporting of suspicious activity

--Mutual legal assistance

--Monitoring of trends: AML, E-Commerce


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Identify Your Customer

Request a copy of the prospective client’s passport or other clear means of identification such as a driver’s license with a picture.

Insure the prospective c1ient is the principal and not an agent for someone else. If an agent, determine who the principal is and obtain the requisite identification.

If the prospective client is an entity, obtain proof of creation and good standing, addresses of offices, names of officers and directors, partners or members and the purpose(s) of the entity.

If the prospective client is a trust, obtain the identity of, and addresses for, the trustee(s) and/or beneficiaries, as well as a copy of the trust agreement.


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Identify Your Customer cont.Obtain one or two letters of recommendation from a reputable,

independent source, such as a financial institution, professional advisor or the like.

If the engagement is ongoing, the required information should be updated periodically, at least annually.

Identify and understand the nature of the engagement

Identify the parties involved.

Determine the nature of the engagement.

Identify any pertinent relevant information necessary to represent the client for the engagement, such as insuring there are no conflicts of interest, or, if there are, obtaining appropriate waivers.

If any information is unclear it should be verified.

An engagement letter, including a description of the services to be rendered, should be prepared and executed by the client.


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Risk-Based Procedures Adopted

– Procedures point out when Bank will use documents, non-documentary methods, or combination of both methods

– Bank’s detailed account opening forms specify required identifying information to be obtained from each customer

– Bank also fulfills verification requirements through non-documentary methods—e.g. by comparing information provided by customer to information received from consumer reporting agency, public database, or other source


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“OFAC”

The Office of Foreign Assets Control ("OFAC") of the U.S. Department of the Treasury administers and enforces economic and trade sanctions based on US foreign policy and national security goals against targeted foreign countries, terrorists, international narcotics traffickers, and those engaged in activities related to the proliferation of weapons of mass destruction.


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Colorado Foreign Capital Depository

BEFORE 9/11

BEFORE THE US PATRIOT ACT


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-“The Colorado Foreign Capital Depository Act sets out some favorable conditions for international banking clients, especially with respect to the civil & criminal liability of state & local regulators, as well as the Bank’s personnel, and in addition the restrictions regarding the enforcement of foreign judgments under the aspect of asset protection.”

FCD- Signed into law June 2001


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What is a Foreign Capital Depository?

• A Foreign Capital Depository (FCD) is a Financial Institution in which individuals and their business entities, who are not citizens or residents of the United States, may deposit assets for investment and safekeeping. Since an FCD is not a traditional commercial bank, it does not engage in lending.


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The First FCD:• American International Holding LLC

was established in April 2003.

• On October 31st 2003, American International’s Foreign Capital Depository charter was granted by the State of Colorado Banking Board. It is the first and only Foreign Capital Depository in Colorado AND the United States.

• Under the U.S. Federal Reserve Act, American International is a financial institution with a direct Federal Reserve account.


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Compliance

– Bank is fully compliant in every way

– Compliance Policies & Procedures modeled largely from Swiss banking rules

– Bank intends to have “first class depositors, do first class business, in a first class way”—(old J.P. Morgan slogan)


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The Components of Colorado Law:

• Financial Anonymity

• Powerful Asset Protection

• U.S. Political and Economic Stability


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Financial Anonymity

• Pseudonym accounts are the only identification used for transactions.

• American International has the statutory duty to protect and hold all client information confidential.

• American International must defend the customer’s private interests in US courts as required by law.


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Powerful Asset Protection

• Foreign judgments are not easily recognized.

• There are substantial monetary penalties when a lawsuit brought against one of our clients filed in Colorado is unsuccessful (up to $1 million).

• Hiring attorneys on a contingency fee basis to sue a client of American International is prohibited.


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Client Needs:• Investment Products:

Access to competitive products in various asset classes

• Asset Protection:Legal safe haven from seizure or currency devaluation due to economic/political instability

• Confidentiality:Identity of the account holder is privileged and protected by law

• Favorable Tax Treatment:Possible mitigation of tax impact

• Real-Time Information Access:24/7/365 access to information, quick response to client requests


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• Risk-Based Procedures Adopted

– Procedures point out when Bank will use documents, non-documentary methods, or combination of both methods

– Bank’s detailed account opening forms specify required identifying information to be obtained from each customer

– Bank also fulfills verification requirements through non-documentary methods—e.g. by comparing information provided by customer to information received from consumer reporting agency, public database, or other source

The Private Bank’s Strengths (cont’d)


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Privacy Protection (cont’d)

• Correspondent Banking Relationships

– Recent legislative changes—especially in European Union—have eroded several important privacy & asset protection features that were previously available to depositors in those jurisdictions

– Some depositors may want privacy & asset protection features of a Private Bank, but want to keep funds in their native currencies, before the actual transfer of funds into Colorado or the United States


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• Bank may not disclose information to non-government entities & has a high threshold of disclosure to federal, state, & local government agencies

• Bank has received a FCD Colorado State Banking Charter & therefore is regulated only by the Colorado State Banking Division

Privacy Protection (cont’d)


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Asset Protection

• Since no individual is permitted to even request information from Bank, judgment creditor is unlikely to learn that a person is a customer of Bank in the first instance

• Person seeking recognition of foreign judgment against a depositor of Bank must prove all of the following:

– Foreign court had jurisdiction over subject matter,

– Foreign court had personal jurisdiction over customer when judgment was rendered, &

– Judgment was rendered under a system that provides impartial tribunals or procedures compatible with requirements of U.S. due process of law


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• With it’s growing focus on business, scenic beauty, world class skiing and summer tourism, Colorado has always been a destination, to live and to holiday, for people around the world. Now, it can be home to their assets as well.

American International is located on the top floor of the Republic Plaza in Denver, CO.

Our Location: Denver, Colorado


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Thank you for your time

John L. PageRegional Director Latin America & the Caribbean

American International Depository & Trust

Denver, Colorado U.S.A.

[email protected]

1-561-789-7472


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Management

• E. Jerry James – Chairman, Founder; current President of The Offshore Institute

• John L. Page – Regional Director; Latin America & the Caribbean

• Sailesh C. Barchha-Managing Director; Europe, Middle East, India & Asia

• Ray Juncosa – Senior Vice President, Compliance Officer, over 25 years in Bank Management

• Richard Rosenberg – Privacy Officer; 15 yrs management experience at Qwest, Accenture, Budget and the US Navy

• Walter Diamond – Chair, Advisory Board, Renowned International tax expert & author, including: KPMG,

Deloitte Touche and Federal Reserve. (Tax Havens: Matthew Bender)

The Newest Form of Private Banking

in the World is in Colorado and its name is:


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american international holding llc © 2006 american international depository & trust 2006 caib...

Documents

international private

customer slide

ecommerce slide

nonus persons

extraordinary diligence

nonus families

private banking accounts

diligence policies