Book reviews are not usually my thing, but I do read a lot and felt it might be worth writing a few quick notes here when I come across one worth talking about.
How to Own Your Own Private International Bank by Jerome Schneider was published in 1998, and I first read it along with some of the author’s other books on offshore finance back in 2000, and just 13 years later, it already re-reads like an alchemy book written in the middle ages of finance. Jerome Schneider was convicted in 2004 for tax crimes, and admitted to being a criminal for helping clients hide their financial dealings behind the names of “brass plate” banks in Caribbean or Pacific island nations. In that time, many of the offshore banking centers listed in the book have risen to international standards of capital and compliance, as well explained by the example of Vanuatu in 2002.
The great shame I see of this book is that it may have done for offshore private banking something like what Enron did for energy trading: it tarnished the potential of an industry with bona fide uses by convincing the public that its main uses are criminal. Most of the writing in this book focuses on how to hide money from authorities, creditors, and others, and how to write transactions that may fall within the letter but not the spirit of US laws, but I struggled to find sections that actually highlighted the real benefits of offshore finance to the global economy or to entrepreneurs. The fact is, smaller banks both onshore and offshore do have a wide variety of very legitimate uses, and I strongly believe that a world with many smaller banks spread over a wider range of geographic locations would be far safer than the current world of concentrated “too big to fail” banks that we hope can be kept safe by rules such as Basel III.
The 15 past years have then left bookshelves with a terrible gap which this title might have once promised we would find content: where entrepreneurship meets finance. Browse any bookstore or library, and there will be books on starting a business, and books about financial skills used at big banks, but it is extremely difficult to find any books for entrepreneurs on how to start a bank or other financial business. Amazon lists a book sub-titled How to Start a Bank with a Thousand Bucks coming out later this week, and I hope to see some good content there.
Full disclosure: clicking on the book image or this link will take you to the Amazon page where you can order the book, and if you do I will earn a small credit as an affiliate. I set this up more to test the Amazon affiliate system than anything else, and since this book does not offer a Kindle version, I would very much like to hear suggestions to any alternate to Amazon as a source of books and e-books, especially for buyers not based in Hong Kong, Singapore, or India.