Taxing Times For Tax Havens

Developed nations crack down on the Bahamas and its ilk

When SG Hambros, a British private bank, was looking to open an office to be closer to its trust and banking clients in Latin America, it considered New York and Miami. But after an exhaustive review, Hambros opted not to locate its Latin office in one of the U.S. financial centers, but in Nassau, the tiny capital of the Bahamas. After all, the island offered liberal trust laws, no income tax, frequent direct flights to the U.S., and, of course, balmy weather year-round. It also promised inviolable secrecy, with access to bank records given only to the signatories on the account. "There is no case where information [on a client] is going to be provided for fiscal reasons," says Pascal Hammerer, CEO of SG Hambros Bank & Trust (Bahamas) Ltd. and head of private banking for the Americas, in his office facing a tropical garden.

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