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Tuesday, November 15, 2005 - Vol. 7 No. 230
In This Issue:
* COMMENT:
"Public" Records Are Getting a Lot More Public
* OFFSHORE:  Sovereign Society Leads China Visitors. Gibraltar Rocks?
Report from Hong Kong.
* WEALTH: Tax Avoidance of Tax Evasion?
* PRIVACY & RIGHTS:  U.S. Visa Reform Needed.
"Public" Records Are Getting a Lot More Public

Dear A-Letter Reader:
If you've ever served in the military, attended public schools, purchased real estate, obtained a business or professional license, been involved in a lawsuit, or were merely born in the USA, a "public record" exists of those events.

Until about 20 years ago, all that meant was that somewhere in a musty basement in a county courthouse, in a dust covered volume, a record existed of whatever interaction you had with a particular government authority.

If someone wanted to know, for instance, if you owned property in West Virginia, he could literally have to visit every county courthouse in the state (all 55 of them) to check the property records there. And he might have discovered that the property records weren't even indexed by name, but by the address of the property. To make matters even more difficult, the address might not be listed as "19 E. Virginia St., Charleston, West Virginia," but as a "plat number." If you didn't know the "plat number," you might not be able to find out who owned the building at 19 E. Virginia St., or anywhere else, for that matter.

My, how things have changed! Today, you don't need to blow the dust off of a moldy book to discover who owns a particular property, has a business license or has been sued. You merely need to visit one of hundreds of Internet web sites that advertise their expertise in searching public records.

Want to know more about me, or any of 300 million other US persons? Just visit one of these web sites, where you can search public records by name, date of birth, Social Security number, case number, etc.

If you don't know where the person you're investigating actually owns real estate, has a business license or has a bank account, that's no problem. These online services will search hundreds of millions of public records, instantaneously, and tell you. Now that's convenience!

Want to know details of former Secretary of State Colin Powell's mortgage? It's online. What about the social security numbers for Florida Governor Jeb Bush and CIA Director Porter J. Goss? Just point and click.

As a journalist and consultant, I've personally benefited from being able to retrieve public records from the Internet at the click of the mouse. But with this ability comes a host of problems:

* Identity theft: If someone knows your name, date of birth and Social Security number, they have enough information to steal your identity. And that information is freely available over the Internet. Example: a 2004 study by the US General Accounting Office found that public records in 41 states and the District of Columbia, many of them available online, contain SSNs.

* Stalking: Online records are a stalker's paradise. Home addresses for doctors, nurses, lawyers, architects, real estate brokers and other professionals in many states are also held in public records. If someone has a grudge against you, and finds your home address in an online public record, it's a simple matter to use a service such as Yahoo! Maps to obtain driving instructions on how to get there from any location in the US.

* Frivolous lawsuits: Divorce decrees and many other types of legal documents that can be retrieved online often obtain real estate values, mortgage information, bank account numbers and other financial data. This information is invaluable to investigators to determine if you're "worth suing." In many cases, an investigator will call up your bank or broker, pretend to be "you" and ask for details about the account. Such "pretexting" or posing as the investigative target, is now illegal, but the practice remains widespread.

* Inability to obtain employment, housing or insurance. It's now possible for employers, property owners and insurance companies to conduct online background checks. Have you ever been arrested? If so, this information is probably available online and easily retrieved by a prospective employer. Have you made a claim under your homeowner's insurance coverage? This information goes into an online database and may make it difficult or impossible for you to ever obtain homeowner's insurance again.

What can you do to fight back? Here are a few suggestions:

* Contact banks and brokers with which you do business and ask them not to answer inquiries about your account without a code word or phrase that you designate. Make sure the word or phrase wouldn't be easy for an impostor to guess, such as your birthday or the last four digits of your SSN.

* If you are involved in litigation, ask that the records be sealed. If that's not possible, you may have the right to request that personal information such as your SSN, bank account numbers, etc. be placed in a confidential addendum that can't be retrieved without legal authorization.

* If your business or occupation requires that you obtain a license, don't list your residential address or SSN on the application. List a post office box or mail receiving service address instead. And instead of the SSN, ask if you can provide a driver's license number or have a random identifying number assigned.

* Consider acquiring real estate in the name of a business entity, rather than your own name. This strategy may have tax implications, so be sure to check with your tax advisor before you do it. In some states, you can use a device called a "land trust" to cloak your ownership of real estate, yet preserve tax benefits.

Finally.

* Move "nest egg" assets outside the US into offshore jurisdictions that are serious about preserving privacy. The egregious violations of privacy we accept in the US for the sake of "convenience" simply aren't tolerated in countries like Switzerland, Panama and many other offshore centers.

Mark Nestmann, Phoenix, ArizonaThe Nestmann Group, Web site: http://www.nestmann.com E-mail: assetpro@nestmann.com

PS: So far this year, 56.3 million Americans have had their identities exposed by security breaches by companies and public agencies, according to the ID Theft Resource Center. Not to mention about 1.8 million who were sued, or the 30,000 who became subject to secret investigations under laws like the PATRIOT Act. Big Business and Big Brother want to keep you and your wealth in plain sight, to be profitably tracked and easily seized. However, you can still legally create international 'lifeboats' of wealth and privacy that are practically invulnerable to snooping or confiscation. To learn more, click here:
LINK: http://www.agora-inc.com/reports/190SLIFE/W190F403 .

By Mark Nestmann, editor of The Sovereign Individual, the Sovereign Society's "Members Only" monthly newsletter, author of many books on privacy rights and tax planning. He heads the Nestmann Group.

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Offshore

 Sovereign Society Leads China Visitors. Gibraltar Rocks? Report from Hong Kong.

FROM THE EDITOR: Bob Bauman Says

BEIJING: No sooner does the Sovereign Society Far East Investment tour arrive in CHINA then the world follows behind us. President Bush is on his way here and yesterday, Terminator Arnold Schwarzenegger, millionaire movie star and governor of California, made a big splash at his first event in China as he and his security detail were mobbed by photographers and fans in the Chinese capital. We missed Arnold by one day as we flew to Shanghai, but he's following us there as well. Just goes to show how effective our leadership is. Now if we can just explain the virtues of democracy to the "Communist" Chinese government....
-----
* Will The Rock Have a Role? Possibly good news from (and for) GIBRALTAR. The EU previously has ordered the UK, which controls Gibraltar, to end its status as an offshore tax and asset haven. While Gibraltar is appealing this to the EU Court, it appears that Gibraltar's 'separate' status could save its role as a global finance center. Gibraltar as a tax haven could be saved from the EU following an opinion by the European advocate-general on another issue with Gibraltar implications. It seems the Court has said that "a tax rate lower than the national tax rate, decided upon by a local authority and applicable only within the territory of that local authority" may be acceptable. Stay tuned for developments.
-----
* Hong Kong at Crucial Stage We will be in HONG KONG tomorrow for four days of seminars. After months of relative calm, Hong Kong's debate on democratic reform is building towards a climax. In October the government's Constitutional Development Task Force released a draft plan that proposed limited reforms: doubling the size of the committee that elects the chief executive in 2007 to 1,600, and expanding the Legislative Council from 60 to 70 seats at the election in 2008. HK chief executive Donald Tsang is walking a tightrope between Beijing and his city-states' people who want more democracy. We'll report more later this week.

 Meanwhile, SWISS entrepreneurs who want to enter the booming Chinese economy were told to be bold but well prepared for a market with more than its fair share of risks. That was the message from discussions this week at the Swiss International Business Forum in Zurich devoted to "Fascination China". 

Wealth

Tax Avoidance of Tax Evasion?

American courts generally support the view that a US taxpayer has a duty to pay no more taxes than the law requires, which would seem to be self-evident.

 What is not self-evident for most taxpayers, is exactly what the US Internal Revenue Code requires a person to pay. Because the IRC is a morass of complexities, with thousands of pages of verbose rules, the ability of a taxpayer, or even professional advisors, to understand what is owed, is often a major question. Similar questions are raised by the tangled tax laws of the United Kingdom. Billions of dollars and millions of man hours are expended each year by taxpayers trying to determine what they owe.

The question is what constitutes "tax avoidance," which is legal, and what crosses the line into "tax evasion," which is not.

W. William Woods, a member of the Sovereign Society Council of Experts, describes a position that, until recently, US courts endorsed: "There is nothing sinister about tax minimization arrangements; the technical term for such a strategy is 'tax avoidance'. Tax avoidance is legal and smart. What is not legal and not smart is tax evasion. Tax evasion is when you breach the letter of the law and it often boils down to outright deception or fraud."

In case of both the IRS and the UK Inland Revenue, there is a conscious, ongoing effort to distort the meaning of legal tax avoidance by lumping it together with illegal tax evasion. For example, John Healey, a UK Treasury official, says: "Tax avoidance and the industry that drives it are increasingly an international phenomenon, and it is vital that we have effective international co-operation to tackle it, as we do for tackling terrorism, organized crime, money laundering and fraud."

So now we have an official position that claims what was once legal tax avoidance is now in the same bracket as terrorism and money laundering.

Let this word blurring bureaucratic trend serve as a caution when you do your tax planning. Make sure yours is legal avoidance, not evasion. If you need advice, The Sovereign Society can recommend trusted experts.* To join The Sovereign Society, click here:
LINK: http://www.agora-inc.com/reports/SVS/ESVSFB09/

Privacy & Rights

 U.S. Visa Reform Needed.

Among the dumber things the US government has done since 9-11, supposedly to protect Americans from terrorists, are unreasonable passport and visa restrictions on foreigners. Some of the new rules are needed, but the one-size-fits-all government attitude has hurt foreign students who want to attend US colleges and universities. Now US education and business leaders are calling for changes to student visa policy as data show international enrollment at US universities fell for the second year in a row.
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THE SOVEREIGN SOCIETY OFFSHORE A-LETTER .
* Bob Bauman, Editor * Daniel Aponte, Jr., Managing Editor,
* Matthew Barrett , E-Commerce Mgr. * Erika Nolan, Publisher.
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The A-Letter provides accurate information on the subject matter covered and advertisements displayed, so far as we can ascertain. We cannot certify the absolute accuracy of referenced articles nor do we necessarily endorse products advertised herein. The Sovereign Society advocates full compliance with all applicable tax and financial reporting laws. All LINKS are operative at time of publication. Nothing herein should be considered personalized investment advice. Although our employees may answer general customer service questions, they are not licensed under securities laws to address your particular investment situation.
LEGAL NOTICE: This document is based on SEC filings, current events, interviews, press releases and knowledge gained as financial journalists and may contain errors. Investment decisions should not be based solely on this document. The Sovereign Society expressly forbids its writers from having financial interests in securities they recommend to readers. Sovereign Society, its affiliated entities, employees and agents must wait 24 hours after an initial trade recommendation published on the Internet, or 72 hours after a direct mail publication is sent, before acting on that recommendation.

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All contents COPYRIGHT © 2005 by Sovereign Society Ltd. All rights reserved. Reproduction of all or part of this document in any form is prohibited without express written consent of Sovereign Society. Protected by US copyright laws 17 USC 101 et seq., 18 USC 2319; violations punishable by 5 years imprisonment and/or $250,000 in fines.
 
 
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