As I predicted, German policymakers just announced they will seek European Union approval for a general “crackdown” on all tax havens in Europe. They’re specifically targeting Liechtenstein, Monaco, Andorra and Switzerland. (Switzerland is not an EU member state.)

As I commented last week, Germany launched police raids on the private homes and offices of a thousand or more German citizens. Many of them were well-known names. The justification was alleged tax evasion by Germans with bank accounts in Liechtenstein. (Neither Liechtenstein nor Switzerland are EU member states).

The German secret police agency, the Federal Intelligence Service (BND), (the equivalent of the U.S. Central Intelligence Agency), paid a €5 million (US$7.3 million), bribe to a disgruntled employee of LGT Bank in Liechtenstein. The German government assumes that every German name on the list of potential tax evaders.

In violation of Liechtenstein’s bank secrecy and criminal laws, the well-paid informant sold the BND a compact disk alleged to contain the names of German citizens with accounts at the bank. German Finance Minister Peer Steinbrück authorized the payment.

Same Complaints, Different Day

Germany is using this illegal bribe and questionable information as an excuse to try and shut down all so-called tax havens. Never mind that these jurisdictions are sovereign nations that have a right to make and enforce their own laws.

The major objection from Germany and other high tax, socialist nations, is that these tax havens allow statutory bank secrecy. These blessed havens also give you the right to set up trusts, corporations and family foundations without revealing publicly the names of the parties involved – and they do all this legally. (That really upsets these meddling busybodies.)

The new German proposals include expanding the scope of the EU tax directive to cover not only interest payments, but all payments, not just to individuals but to all legal entities. Under the so-called “EU tax directive”, EU member nations withhold taxes for EU citizens with an account in other EU nations. Germany is also demanding agreement from tax havens to share upon demand from tax havens to share all individuals’ tax and financial information with other governments.

Another Media Circus…Yawn

Excuse me while I yawn. Those of us in the offshore world are perfectly aware that welfare state tax collectors have been trying to shut down legal offshore activities for over a decade or more – and they haven’t succeeded yet. But the frustrated tax collectors leading this charge have managed to form the Organization for Community and Economic Development (OECD), as their global mouthpiece.

The real offshore financial havens, meanwhile, have continually refused these high handed demands. Liechtenstein, for example, steadfastly has refused to alter its financial privacy laws. If you’re a freedom-loving citizen of any nation, you need to recognize this latest campaign for what it is: Just the continuation of a well-marketed media war, that’s meant to scare you away from fully legal offshore activities.

The best way to fight this is to continue to take your assets offshore – but follow the tax rules and regulations. The tax bureaucrats tend to frustrate easily when they find you’ve done everything the law requires – and you’re enjoying the much better global investment and wealth preservation opportunities offshore.

BOB BAUMAN, Legal Counsel

P.S. Next week, our experts will be on scene in Whistler, Canada for an extremely unique annual event: our Permanent Wealth Protection Summit. Each of our experts will meet with our privileged couples privately, and help them create their own personalized wealth plans. Still thinking about taking next week off and joining us? Click here for details now.