A must read if you're an expat threatened by kidnappingBY JON GOLDING
British expats live and travel to some very exotic places in connection with work or leisure. Unfortunately some geographical locations in Asia are rife with incidents of kidnapping.
Recently in Kuala Lumpur a Dutch school boy was kidnapped from outside one of the international schools. At my condominium, a friend’s fiancé was kidnapped on a work assignment abroad and the company had to find £500,000 sterling to secure his release.
The company did not have specific insurance for such an eventuality and had to find the funds from company resources! One report ‘Captive audience’ in International Adviser, February 2012 stated: ‘…wealthy people around the world – as well as multinational companies with employees living in, or traveling to, potential hotspots – are bracing for trouble.’
Whilst the incidence of kidnapping is comparatively rare it is a growing threat in the region for both businessmen and, as we have seen in Kuala Lumpur, their family members who are now considered ‘soft’ targets.
It is almost always a case that information regarding wealth circumstances is being passed on by an informant known to both kidnapped and kidnapper (e.g. maid, driver, fellow employee or service professional).
What protection is in place for the expat if such an incident occurs? Do you, your family or your employer have the 24 hour contact of a special risks contingency provider (i.e. kidnap/ransom negotiator)? Do you have specific access to funds for payment of ransom by way of insurance or failing that, liquidation of current assets? In the case of the latter how long will it take to assess the value of assets and liquidate those assets to pay the ransom?
Another nightmare scenario is that there is a person in your bank who covertly or inadvertently makes information e.g. large transfer, name, address and date of birth, available to a colleague/relative/kidnap associate!
Indeed, even in the UK banks are not immune as the Daily Mail, 3 August 2011 comments on bank fraud ‘…each case is likely to involve hundreds or even thousands of customers. The majority of these details were sold on to organised criminals.’
How to get around this problem is to consider each time a transfer is made of funds locally; check with your local bank who is responsible for handling such enquiries and what is his/her authority and get a copy of the bank’s confidentiality rules.
State that no information should be divulged to third parties unless you are informed and the bank’s computer appropriately red flagged.
There is nothing to stop the bank or institution advising you when such an approach has been made. All in all keep capital sums in the local bank jurisdiction to a minimum with the feeder account from another ‘safe’ offshore banking jurisdiction.
In the case of the kidnapped businessman mentioned above, it took four days to secure company funds for his release meanwhile he was bound and gagged and moved from house to house! In other cases (e.g. retired Expats); does your financial adviser have an up to date valuation profile and can those funds be liquidated quickly or is there some insurance in place to cover the funds liquidity delay?
Do consider this ongoing threat seriously and put in place some contingency plan because if it happens it is then too late to take action!
Jon Golding ATT TEP, UK Tax and Trusts Adviser, Globaleye, Singapore