F&E Glossary of terms

Anonymous banking is where the banks of certain countries are used for holding currency, based on the voluntary or statutory level of secrecy the banks provide.

Switzerland is one such example, where the law only permits a bank account to be associated with an individual in cases of severe criminal acts or atrocities, such as identifying a terrorist's bank account. Otherwise, the details of the account holders are held securely, the account is only identified by a number, and a bank employee violating privacy is punished quite severely by law. Costa Rica and the Bahamas also have attractive banking laws.

There are a number of reasons to use anonymous banking:

To store embezzled money.
To launder money.
To prevent confiscation of money.
To pay less tax (banking secrecy extends to tax agencies being refused permission to examine accounts).
For any other reason which requires no-one being able to identify the amount of money you have or have earned/acquired.
Simply for privacy.

Advances in financial cryptography (e.g. public-key cryptography) make it possible to use anonymous electronic money and anonymous digital bearer certificates to achieve financial privacy and anonymous internet banking.

Anonymous banking is sometimes considered one of the main aspects of Private Banking.

The USA Patriot Act has created many new rules for U.S. Banks in an attempt to defeat Anonymous banks. A list of such banks or shell banks are given to the U.S. banks who are not allowed to wire money to them. All new customers to a bank must now be asked if they are a U.S. citizen, and if not, if they are a foreign political figure or related to one in any way. They must also give their occupation and state if they expect foreign money to be wired to them. The main goal is not as much to combat terrorism as to stop corrupt foreign politicians from being able to successfully drain their countries treasuries.

External links

J. Orlin Grabbe homepage, DMT network (http://www.aci.net/kalliste/)
End of ordinary money, part 1 (http://www.aci.net/kalliste/money1.htm)
End of ordinary money, part 2 (http://www.aci.net/kalliste/money2.htm)

source: http://en.wikipedia.org/wiki/Anonymous_banking

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