✔️ Information reviewed and updated in April 2024 by Pedro Martínez González

Tax havens are known for being countries where tax regulation is very lax, that is, you are hardly charged taxes or commissions by the government. While this might sound attractive, in reality tax havens lend themselves to money laundering and fraud.

Fraudulent brokers or scrámmers have found in these tax havens a way to evade regulations and operate illegally. That is why here we will tell you which are the most common tax havens for fraudulent brokers, as well as how to identify them.

➡What are tax havens? ✨

We can define tax havens as nations or places where companies that seek to pay less taxes find their refuge. In addition, many of these havens have much more relaxed requirements to register a company such as less paperwork and information which makes tax havens also a haven for privacy.

The problem in tax havens is that they tend to lend themselves to money laundering, drug trafficking and tax evasion. By requiring fewer requirements to register a company, as well as by charging less taxes, the appearance of fraudulent businesses is encouraged.

➡Benefits of tax havens for companies✨

One of the clearest benefits of tax havens is the reduction in the payment of taxes. This is due to the fact that in these paradises the payment of taxes usually goes from 15% (of any country) to 3% which, without a doubt, means tax fraud.

Many of these paradises offer maximum discretion and anonymity to companies, which can mean a great benefit when taking care of your information, although it is not.í. According to experts, this discretion leaves room for criminals to operate with front companies.

➡How do they affect you? ✨

You should know that a tax haven has serious damage to the economy of companies, countries and people in general. The first thing you should know is that by paying less taxes, companies are committing unfair competition by lowering their prices, but illegally.

In addition, these types of paradises promote the concentration of wealth, preventing others from growing equitably. Another point is that, by paying less taxes, companies stop collaborating in the growth and development of the community that surrounds them.

Another way in which a broker in a tax haven affects you is that the risk of them being a fraud or credit card is much higher. Remember that these havens hide information and have very few regulations so that any fraudulent company can operate without restrictions.

This increases the risks of fraud and theft of information and data, in addition to the fact that, being in a country without restrictions, it is impossible to take legal action. There is no user protection or guarantees to back investors' money which increases the risk of fraud.

➡4 tax havens most used by Escrámmer brokers✨

The first thing you should know is that there are brokers that are registered in these paradises, but that they are reliable. This is normally done in order to have a base of operations in a new continent, for example, America.

You should also know that there are brokers that, although they are not necessarily a fraud, they are registered in this type of paradise. This may be a bit suspicious, since there are no regulations and protection involved; that is why you should stay away from that broker.

• Belize

Although Belize is one of the most reliable tax havens, because its regulatory body has a good structure, requirements, and even alerts about broker scrámmer, Belize is also a tax haven. This is due to the fact that the operating cost, due to taxes, is very competitive.

• San Vicente y las Grenadines

This tax haven is located on the island of the same name which is located in the Caribbean Sea off Venezuela. To register your company, the only thing that will be required is a payment of $ 300 plus an annual payment of $ 150.

• Vanuatu

Located near New Guinea in eastern Australia, Vanuatu is one of the best-known tax havens. Although there are certain requirements to regulate companies, in reality information such as data on the company's history or verification of its operations is not required.

• Islas Marshall

Again we find a set of islands, only this time located in Micronesia in the Pacific Ocean. To register as a broker in this country you need only $ 100.000. Here we find many registered scrámmer brokers due to lack of regulations.

➡How to identify a Scrámmer Broker registered in one? ✨

Identifying a broker registered in a Scrámmer is very important to avoid being a victim of fraud. These 3 points will help you to know if your broker is registered in a tax haven so that you can run if necessary.

• Address: Go to the terms and conditions section and find the address with which the broker registered. Then paste it in maps and verify that it does not correspond to any of the existing tax havens; if so, then watch out for the broker.
• Registration or license number: Regulated brokers operate under a registration or license number which is used to identify you in the regulatory body where you registered. Look for that number in the broker's legal section and check on the regulator's website to see if it is actually registered.
• Other information: SIf you only find a legend that says the country where it was registered or where it operates, or you simply cannot find this information, then you must flee. This is because the lack of data, or their ambiguity, can be a sign of fraud.

About the Author: Pedro Martinez Gonzalez

I'll tell you a little about myself! I am a financial analyst and economist with a master's degree in finance.
About my studies: I studied at the University of Salamanca for a Degree in Economics and then did a Master's in Finance in Madrid.
Do you want more information? You can read more about me here in my biography.

You can read more about me here.