Attorney Paymaster with Swiss trust bank account? 4 steps to get clarity with business partners first

1. February 2020


"Do you work as an international Attorney Paymaster? Can I open a trust bank account with you in Switzerland? I need a good bank account quickly for large deals!"

Although I have stopped working as an Attorney Paymaster (Lawyer Paymaster) for quite some time now, I still do receive such requests - from project owners, global entrepreneurs, brokers and intermediaries in commodity trading, financial instruments trading and project finance. Time for clarification - and for a few honest words, what 4 actions I strongly advise my potential clients to take for them to become truly successful.

The situation

Are you active as an entrepreneur or investor in the area of renewable energies, infrastructure or humanitarian projects? Do you expect large sums of money to finance a wind park? As an entrepreneur you want to invest in a new manufacturing facility and expect high returns from a Private Placement Program (PPP)? Perhaps there are also business intermediaries who expect substantial commissions from you, for example after the successful sale of large quantities of grain?

It is quite clear: For all these financial transactions you need a solid bank account at a reliable bank with the capacity for large funds. What could be more obvious than to hire a licensed and regulated international Attorney Paymaster to receive and transfer money, a Lawyer Paymaster?

Your investors or intermediaries may even require such an Attorney Paymaster to ensure that payments are made securely, reliably and lawfully. Most standard commodity trading contracts (forms) already provide space for such bank details of an escrow bank account.

Many international business deals do not come to fruition

I have taken over this role as Attorney Paymaster for several years and worked as Attorney Paymaster and professional Financial Intermediary worldwide until I stopped in the beginning of 2018; including having my registered office in Switzerland and membership in the self-regulatory organisation (SRO) Polyreg, which is controlled by the Swiss Financial Market Authority (Finma). My experience as an international Attorney Paymaster (Lawyer Paymaster) is as sobering as it is obvious:

A good 95 percent (!) of all my clients' transactions for which I had opened trust bank accounts as international Attorney Paymaster (Lawyer Paymaster) were not yet ready for financial settlement.

The reasons? Many business partners knew each other only on the surface from the Internet and had never met in person, let alone built the trust necessary for such extensive deals. Often the key elements of the contract had not even been negotiated. Many deals failed at the last moment because one contractual partner was unable to deliver.

A lot of the commercial contracts or investment agreements presented to me turned out to be amateurish forgeries; with false company names, theft of identities and even stolen and manipulated copies of passports.

Banks terminate accounts quickly nowadays

Fraudsters often try to obtain confidential personal data in this way, which they then misuse (so-called identity theft). Even if the bank accounts are particularly secure and actually worthless to fraudsters the reputational damage for the account holders was and is immense.

Nowadays, banks terminate the business relationship quite quickly if one of their accounts appears on dubious contracts and the compliance department finds out about it.

This often frustrating experience for my clients and for me has led me to shift the focus of my advice - away from being a mere administrative Attorney Paymaster and towards becoming a global Trusted Advisor and international Lawyer who matches the right partners, ensures legal transactions worldwide and thus helps his clients to achieve true successes. So that the waste of money and time comes to an end.

How to do that? Performing a "Human Due Diligence Check"

First, you need a structured "Know Your Customer (KYC)" process with in-depth background research on the people involved (and on the specific transaction). This is mainly about an analysis of the contracts and the entire communication. Important: The KYC process must be suitable for your specific business. This is where the Human Due Diligence Check all starts.

Secondly, you must carefully analyze the personality and human behavior of all those involved in the business. This requires both a structured and analytical approach (checklists!), but above all a good perception, intuition and knowledge of human nature. You can train all these. So what is to be done?

1. Gain distance and detach from the deal

The next time before you seek or hire a Lawyer Paymaster (Attorney Paymaster) to handle the financial side of your business, take a step back and look at the business and the people involved in a sober and detached way.

This alone can be a real challenge, especially if you have been working towards a deal for some time. The higher the sums and the greater the expectations, the more distance is helpful. Often unconscious feelings cloud the view for the fundamental things.

2. Check peoples' identities, clarify the origin of funds

Determine the identities of all participants beyond any doubt. This is especially important if you establish new business relationships via the anonymous Internet. If unknown investors want to invest large sums of money supposedly very easily and quickly in your project or company, special caution is indicated.

In any case, clarify beyond doubt who the Ultimate Beneficial Owner (UBO) of the money is and collect all information about the investor that you can find in public sources and databases. If you do not do this and something goes wrong later, you may be liable to prosecution - as an accomplice in money laundering or for violating international financial sanctions.

3. Check the background of the transaction itself

With every transaction in which you are involved or from which you as a broker want to profit, ask yourself whether it is plausible. Actually, also this is quite self-evident: Only involve yourself in transactions that you understand down to the last detail. Ask yourself and your contact whether the transaction makes any commercial sense.

If even the parties involved cannot explain exactly why the money should be transferred in this way and not another way, then your doubts are probably justified and extreme caution is required.

4. Closely observe the entire human behavior of all involved

Analyze the human behavior of your business partners very carefully - and pay attention to every detail. How does your business partner or supposed investor react to your detailed questions? Are his or her answers just as detailed or do they remain strangely vague and superficial? Is there a lot of pressure being put on you in terms of time or contents? Are you being asked to do things that are not acceptable from a legal perspective or that do not match your personal integrity?

Once you have true clarity about the people involved, the origin of the money and the background of the planned transaction, you can still decide whether the deal is worth your time and effort. It then often turns out that you do not need a Lawyer as Paymaster.

If you have a clear view, know the background and build up real trust with all business partners and the banks involved, you can usually do business without an Attorney Paymaster.

About the author

Dr. Jan Hendrik Taubert

I am an international Trusted Advisor (Lawyer) and Private Mentor for successful global entrepreneurs and investors like yourself. I support you worldwide on site to grow your projects, trade and finance in a lawful way – to make a difference in the world. In my spare time you will find me by the sea, in the sea or on the sea – meditating, swimming or sailing.

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