[HashThis]

100%. Elites are allowed to do "money laundering" while commoners are put in jail for it.

FinCen exists to put commoners in jail, for the same things the Elites can do without going to jail. The Elites use Shell Companies to do the same tactics.

The following have FinCen put commoners in jail, but elites move money the same way via Shell companies and stay out of jail: 1) Breaking up transactions, to hide total amount. Commoners=Jail vs Elites=Shell Companies.

2) Fee assets when law enforcement comes = "Obstruction of Justice". Commoners=Jail w/FinCen. Elites=no jail via Shell companies articles of incorporation

3) Keeping identity secret. Commoners=Jail w/FinCen. Shell Companies= No Jail

4) ...list every way commoners go to jail via FinCan and cross boarder. Elites do full list via Shell companies and don't go to jail.

[nine_k]

From your comment, shell companies look like some magical protective gear.

Are they that expensive to set up? I think a discerning commoner could consider doing so if the amount of money is enough to certainly trigger AML.

[yourapostasy]

> Are they that expensive to set up?

It depends.

Usually it isn't the shell company itself per se that is expensive, it is the professional advice to use it to achieve your desired ends that you pay the big bucks for.

That said, a run of the mill offshore company in <insert-island-banking-nation-here> runs around $3-5K USD per year in various administrative and filing fees, depending upon your specifics.

Slightly less for a US shell company.

However. In order to avail yourself of advice for various tax minimization tactics and strategies, and have those tax attorneys nearly indemnify you when the IRS comes a-knockin'...now you're talking percentages of AUM. It isn't the specific consultation fees, though those are fairly healthy. These consultants won't really materially help you when the IRS audits you unless you have been running your entire bookkeeping and CPA book of business through them the entire time. Those fees rack up quickly over the years.

Once I worked out their business model and the numbers, it suddenly made sense why the fancy tax minimization strategies were commonly employed only by large companies hiring these folks, large companies with in-house teams like this, or count-the-commas-club UHNWI's. The strategies they shared with me were clever, years later I independently confirmed they would have worked, but I don't have nearly enough FCF to sanely justify using them.

[3np]

I'd imagine that insights into specifics and knowing who you can trust for what is a major barrier.

[yamtaddle]

From what I've gathered from various schemes like this, including smaller-fry ones, it seems like the minimum requirement is to have enough Serious Business Shit going on that you can plausibly mask a bunch of activity (international, ideally) as part of that. Normal people don't.

You've also got to have enough money that any tax authority looking at you decides you'd be an expensive target, so they won't try it unless they're sure it's a slam-dunk.

[nine_k]

OK, if we assume that it only works if you can hide a small amount of illicit activity in a flurry of legit activity, it can't be such a large problem; maybe you can make 5% of your transactions illicit, but not even 50%. I don't think this is the case with Russian oligarchs right now.

I always had thought that the idea of shell companies is that there is a long chain, or even DAG, of companies that own basically nothing but obligations of other such companies, and the structure is large enough that tracing it back to the original masters and beneficiaries becomes infeasible.

If running a typical no-op LLC is $200-300 a year, running 30 of them is $6-9k, not an entirely trivial amount but quite feasible for anyone interested to hide even mere $200-300k of illicit activities, like selling a moderate-size home.

[6510]

we cant accurately enough guess how these boutique wealth management firms do their thing... but we could pay them to do the guessing for us.

[Red_Leaves_Flyy]

>we could pay them to do the guessing for us.

No we can’t. Their clients would drop them with prejudice if they even suggested serving commoners.

[6510]

They can chose the persecution if they insist?

[zoklet-enjoyer]

I imagine super cheap and easy to set up. Can't be much more complicated than creating an LLC

[nine_k]

Such was my idea, too. But a peer comment mentions that the scheme only works if there is enough background activity to hide a particular tree in the forest. I'm puzzled.

[temp2022account]

$50/year for an llc in Delaware from what I recall hearing a few years back