Banking Secrecy: Why Opening an Offshore Banking Account in Puerto Rico Still Makes Sense

Offshore banking was once a haven for many wealthy individuals to use as a legal place to store their money for a rainy day. Unfortunately, drug dealers, embezzlers, and corporations and individuals looking for tax havens have all but eliminated this option.

Those who don’t know often associate offshore banking for these bad uses, but uncertainty and lack of confidence in the banking system – especially the Western banking system – is actually one of the most common reasons to use offshore banking to protect one’s assets.

Opening an offshore bank account

AEoI and CRS make asset protection difficult

Due to rules like Automatic Exchange of Information (AEOI), and Common Reporting Standard (CRS) laws, it’s becoming increasingly more laborious and less practical to secure your hard-earned money in an offshore bank. To make it worse, there are groups of people specifically targeting these banks to leak personal information, such as was recently divulged in the recent Paradise Papers last year, and the Panama Papers the year before.

Those are inevitable, though – given the fact that some people use offshore structures for illegal purposes. Unfortunately, for those who just want to protect their wealth legally and enjoy lower taxation in the process, the whole situation is rather unfair for two main reasons:

1. Establishing business entities and creating bank accounts overseas in order to reduce tax obligations is perfectly legal

U2 frontman, Bono, was publicly shamed when the Paradise Papers outed him for investing in a foreign shopping mall using perfectly legal overseas businesses he owned to accomplish this. In fact, many people are using such structure to merely find a save, legal haven for their wealth from uncertain political and economic situation in their countries.

2. Relying on your government to protect your wealth is a bad decision

Ideally speaking, your government should be taking care of you – that’s why you pay your taxes diligently. However, in reality, the governments of the world are having a hard time taking care of national challenges, let alone taking care the welfare of the citizens.

In the US, The FDIC only protects deposits up to $250,000 (in most cases). This means if you have any sort of wealth worth protecting, you might need dozens or more in separate bank accounts to receive this protection. Even in situations where a bank fails and the FDIC takes over, the wealthy are still at risk. If the organization can’t find a successor bank to take over your wealth or your holdings is unsecured, your money can be tied up for years or lost forever.

Recent transparency laws have created a ‘witch hunt’ against those who have significant wealth and/or just do not have faith in trusting their money in their own country.

So, what are the solutions to this problem? Should we just give up and trust everything we have to your local financial system? Fortunately, there’s one of the no-longer-many solutions you should seriously consider: Banking in Puerto Rico.

Puerto Rico flag

Puerto Rico: No reporting requirements, low-tax offshore jurisdiction

So, why should you open a bank account in Puerto Rico, a US territory? Here’s a list of the benefits you can expect:

1. Low tax rates

Puerto Rico, a US territory, offers the lowest legal tax rate you’ll find, in addition to other incentives — if you choose to make a move and reside there:

  • Income tax rates as low as 4% — compared to 39.6% that’s common stateside.
  • Tax free dividends on company profits and investments.
  • Tax free capital gains (on, for example, real estate and corporate shares).

2. You’re offshore, but not out-of-country

Strangely, the US doesn’t exchange information with other countries under the AEoI and CRS standards. They are allegedly a global tax evasion haven for asset holders from other countries to store their wealth in. The US is the strongest, actually.

3. Full reserve banking

It’s well-known that you can’t just walk into a Bank of America and ask the teller for $1M in cash. Called fractional reserve, the vast majority of banks take your money and lend it to others to generate a profit. It’s a standard banking practice, and it doesn’t really matter to you – until you need to get your hands on your cold hard cash.

Our partner bank in Puerto Rico is one of only a few that offers full reserve banks, that keep your cash on hand, and can give it to you upon request with limited hassle.

4. Minimum account balance required

You don’t need to be rich, or willing to part with your entire life savings to open a Puerto Rican bank account. This is a big contrast to other offshore banks which, understandably, require a hundred thousand or more in cash, to open an account with you.

As a minimum, USD or EUR 500 is all you need to open an offshore account in this country. Why is this possible? They make money by charging you higher fees for the privilege. Those higher fees make it worth their while to serve you, and offer you the benefit of privacy, easy access, and security.

5. No AEoI/CRS

Perhaps the most significant upside of banking in Puerto Rico is the fact that the jurisdiction isn’t obliged to share a client’s personal information with anyone. That’s right, Puerto Rico isn’t required to share your account information with your local taxmen, making it an ideal jurisdiction for asset protection.

San Juan, Puerto Rico
San Juan, Puerto Rico

Should you move to Puerto Rico for opening an offshore banking account?

To enjoy lower tax rates and diversify where your money is held, it might seem like the only option is to ditch your passport and move abroad.

Fortunately, you don’t have to.

The reasons for not wanting to physically move to Puerto Rico are many including business, family, and other roots you may have wherever you’re currently located. That doesn’t mean you shouldn’t open a secure offshore account though. You can, in fact, open the account without the need for physically present at the bank; just use a trusted International business service provider’s service, and they will take care of your account opening process.


As you can see, Puerto Rico offers advantages to both wealth and limited income individuals looking to secure their money outside the US banking system. Merely having your money in an account that the entire world doesn’t have access to makes it so worth it to move some of your money into Puerto Rican banks.

So, is there still a good reason to put your money in an overseas bank account? The answer is yes, as long as we’re talking about Puerto Rico and you make a well-informed decision. Your next step today is to consult with your trusted financial consultants and attorneys, to see whether going offshore is the way to go.