 "A money changer counts US dollars. Reuters")
America’s rich may be staying right where they are under US President Donald Trump.
But it’s a different story when it comes to their money.
The richest Americans are scrambling to open bank accounts in Switzerland.
The development comes as many of the elite in the US fear a coming economic downturn and becoming targets of the Donald Trump administration.
Hundreds of millions of dollars are said to be flowing out of US coffers.
But what do we know? What do experts say**?**
Let’s take a closer look:
What is happening?
According to Financial Express, more and more financial experts are witnessing clients in the US approaching them to set up bank and investing accounts in Switzerland.
This despite Americans technically being unable to open Swiss bank accounts due to Foreign Account Tax Compliance Act (Fatca).
However, if a Swiss adviser is registered with US Securities and Exchange Commission, they can open accounts and manage the money for clients.
But if a Swiss wealth or asset manager is registered with the SEC in the US, they can help clients open accounts and manage the money.
As per Daily Mail, the rich are removing money from the US and shifting it to Switzerland and the Channel Islands of Jersey and Guernsey.
Robert Paul, co-head of private clients at UK-based wealth management firm London and Capital, told _The Telegraph, “_These are big chunks of money. We’ve had five cases in the last three or four weeks, and the sums have been $40 million, $30 million, $30 million, $100 million and $50 million.”
“I am expecting to have at least this again if not more.”
Judi Galst, the managing director of private clients at Henley & Partners in New York, told The Telegraph one fourth of her clients are enquiring about Switzerland.
Some are eyeing migration strategies like New Zealand’s investor visa scheme, but others “really just want to open bank accounts in Switzerland,”Galst said.
“I hear a lot about Switzerland and Liechtenstein. I talked to somebody at one Swiss bank who told me that they’d opened 12 accounts like this for Americans in the past two weeks,” she added.
They’re concerned that it is not in their best interests to hold all of their assets in the United States. They want to diversify any risk and that involves them potentially moving some part of their portfolios to other countries.”
Why is this happening?
Experts say clients, looking at Trump ’s trade policies, want to diversify their assets.
Josh Matthews, co-founder of wealth management firm Maseco, told Financial Times he has previously seen this during the financial crisis .
Matthews laid the blame on this squarely on “the uncertainty of a Trump presidency.”
Paul told The Telegraph, “There has been fear around capital controls and movement of money. Why it’s heightened in the past four weeks is because the rhetoric is chopping and changing pretty quickly.”
“A lot of this is discussions around dinner parties of the ultra-wealthy,” he added.
But others begged to differ.
A chief of a small US-based wealth management business told Financial Times that it wasn’t that the demand for Swiss bank accounts had increased.
Rather, Swiss financial institutions had begun understanding how to deal with tax issues in the US.
US authorities have for years been tamping down on US’ citizens’ Swiss bank accounts.