Friday, April 28, 2006

Offshore Trust

For many years due to their high cost trusts were reserved for only the wealthy. However, today with the information superhighway more and more people are finding out that a Offshore Trust can be establish by professionals without the inherent high cost.

There are concerns for all of us as we see our resources come under increasing risk; taxes eating away at our earnings; and the needs to assure funds for education, retirement and health maintenance growing.

More and more people just like you are seeking ways to cope in today's complex financial world. Thousands are looking to foreign jurisdictions where taxes are non-existent or minimal. Millions of families rely upon trusts to guard against confiscatory taxes, judgments and claims of creditors. Older people are using trusts to assure comfortable retirement in the face of expected long life and the possibility of ending their days in a nursing care facility.

Young people see in trusts the opportunity to accumulate wealth which otherwise would be limited by taxes, regulation and assessments. It requires little imagination for you to realize how much more you can benefit through a properly established and professionally managed Offshore Trust.

Depending on your citizenship, residency, motives, objectives or dreams, resources can be managed by a trustee offshore to minimize, avoid or delay taxes; encounter no problems with inheritance wishes; and have resources beyond the reach of those who would seek judgments against beneficiaries.

If ever there was a time when an offshore Trust should be considered for personal or business financial planning, it is now.

The Belize Trust Act of l992 that incorporates the best of a number of offshore jurisdictions is fast becoming the leader in the establishment of Offshore Trusts.

For details read here

Thursday, April 27, 2006

Offshore outsourcing India

Offshore outsourcing to India is one of the most popular management practices today. Though it is generally spurred by the cost reduction factor, this is just one of the reasons one should consider offshore outsourcing. Most parties who outsource are unaware that Indian Service Providers do not just offer cost effective solutions, but also value addition by improving productivity and quality.

Why consider offshore outsourcing to India?
Offshore outsourcing has been popular for several years. Countries like India are popular offshore outsourcing locations which offer cost effective solutions. There is a wealth of articles and write ups about the cost advantages of offshore outsourcing with a majority claiming anywhere between 40-50% savings.

However, offshore outsourcing has come under attack recently. There is an outcry against outsourcing by parties in the US and UK because of the loss of jobs to people in these countries. Many have pointed out actual costs and poor quality of service as the hidden truths behind the attractive packaging.

Offshore Outsourcing is not just about cost.
One should understand the need for offshore outsourcing better before making a decision. Cost is definitely one of the main reasons for offshore outsourcing to India, but one should realize that this cost advantage may not be seen immediately. Initial investment in infrastructure, training, and other such preliminaries may make one believe that the cost advantage promised is just the illusory pot of gold on the other side of the rainbow.

However, this cost advantage is seen over a period of time in a outsourcing venture which involves a committed relationship and understanding between both parties involved. A recent article on IBM and outsourcing illustrates this.

So the aspect of saving money does exist, but one has to realize that initial investment may make the promise of cost reduction seem false.

There will be savings and along with these savings there is great value addition. Most who outsource only realize the quality and value addition after the offshore outsourcing relationship begins. This is not usually the primary goal when deciding to outsource, and the creativity and talent in India comes as a surprise to many.

Offshore Outsourcing to India is about quality and value addition at a reduced cost.
The shift in motivation is already apparent. The fact that so many companies continue to outsource is proof of this. Along with the sheer volume of work that is pouring into the country comes recognition of the talent and expertise possessed by Indian Service Providers.

In an article featured in COMPUTERWORLD on India's prowess in the outsourcing domain, several analysts and outsourcing parties believed that cost was no longer the only reason why outsourcing to India is an attractive option. Companies in countries such as Russia and China have begun offering better rates than Indian companies.
The article continues to explain how major Indian software vendors have developed more of a global services delivery capability than their counterparts in other countries. India's workforce also offers the largest pool of technical skills in the world, and the country's universities add 180,000 engineering graduates to its ranks annually.

Indian companies also realize that cost cannot sustain the country's current dominant position in the offshore outsourcing industry. Nandan Nilekani, CEO Infosys, points out that the way business is conducted is changing. The perfect formula two years ago is no longer the way to do business today. Now the mindset is changing from a company that simply provides services to one that provides solutions.

Offshore Outsourcing to India - A shift in motivation
Already many companies are outsourcing with quality rather than cost in mind. Google's recent announcement about setting up an R&D center in Bangalore reflects this new mindset. In an article featured in the E- Commerce Times, the author comments on Google's hiring practices as legendary, with the company "...reportedly selecting only graduates of the nation's top schools to be considered for employment".India emerging as a global brand in terms of superior quality is not only being seen in BPO but also in manufacturing which has so far been considered China's forte.
Offshore outsourcing involves a great deal of thought. One should not be spurred simply by expectations of rapid cost reduction. The new mantra of offshore outsourcing to India is quality solutions. When processes are offshored to India, companies not only get the advantage of low cost but also experience improvement in productivity and quality. These are the reasons that should motivate offshore outsourcing to India.

For details read here

Wednesday, April 26, 2006

Offshore Outsourcing Satisfies

A new survey conducted by the Weissman Center for International Banking at Baruch College and The Paaras Group (TPG) found that offshore outsourcing (simply called "offshoring" in the survey) is working for many adopters.

The survey canvassed 38 adopter companies (30 from North America and the remainder from Europe), of which over 60 percent were banks and financial services companies. Half of the entire sample space was constituted by companies with more than $5 billion a year in revenues.

Most (85 percent) of these companies are involved in IT offshoring, with 36 percent outsourcing contact centers and 40 percent offsourcing business processes. Although the tendency is to think of offshoring as a relatively recent phenomenon, over a quarter of all surveyed companies have been involved for over six years. There were no offshore call center adopters, on the other hand, who had that length of experience.

Regardless of the offshoring model, the surveyed companies reported an 89 percent satisfaction rate (with 43 percent satisfied "in a major way"). Furthermore, 89 percent also plan to increase offsourcing (65 percent "in a major way"). A total of 93 percent of respondents believe that offshoring has grown, while 61 percent believe that the quality of offshoring has improved.

The survey affirms that the primary (94 percent) motive behind offshoring is cost savings; however, no less than 63 percent of companies said it was about accessing skilled resources and 51 percent cited improving quality.

Specifically, making offshoring work involves setting up a program management office (85 percent) which broader success factors involve knowledge transfer (76 percent) and internal commitment (also 76 percent).
For details read here.

Tuesday, April 25, 2006

Selecting the Right Offshore Vehicle

Good preparation includes selecting which functions to send offshore and determining which countries have the expertise needed. In addition, be aware that there are several categories of offshore companies from which to choose. There are variations in how they're structured, where they're managed and where the work actually gets done. These factors result in significant differences in scope, cost, risk and operational aggravation. Selecting the right vehicle will have a significant effect on the success of your offshore efforts.
Most offshore providers fall into one of the following categories:

Full-service. Traditional, large services firms (such as IBM, EDS, Fujitsu, Hitachi and Cap Gemini Ernst & Young) offer a wide scope of services. They have a fluent understanding of the market in their home countries as well as many other major markets. They have a proven track record in both IT services and business process outsourcing (BPO). These companies have recently hired large numbers of technical staffers in lower-cost countries, providing a unique opportunity to go offshore without really leaving home.

Consider full-service firms if you're sending a major, multifaceted chunk of your portfolio to one offshore provider - for example, development, maintenance and server farms. The more complex your outsourced portfolio, the stronger your need for breadth, flexibility and reduced risk. Unfortunately, full-service firms have a high cost structure and may offer little savings over doing the work in-house.

Established offshore. Initially, this was the only offshore segment. The best known of these (Tata, Wipro and Infosys) are in India and have excellent delivery capabilities within certain niches. Many started as "body shops" and have evolved to now offer BPO. They try to minimize cultural differences by employing an international sales force and staffers who will shift their work hours to accommodate your time zone. But their top management may or may not have a good grasp of the business environment in your country. Since these firms are owned abroad, you may experience some difficulties with legal and intellectual property issues.

What began as a great niche industry is fast becoming a full-service marketplace. Watch for these established offshore companies to mature rapidly and expand their service offerings. They're beginning to compete directly with full-service firms, putting pressure on their rate structures. Use them to save money when their service offerings meet your needs.

Homeshore-anchored. This is a company that's owned and anchored by a management team in your country but is essentially an offshore company because the majority of staffers are located in low-cost countries. Examples include Cognizant and Syntel in the U.S. and LogicaCMG in the U.K. These firms understand the markets of the countries where they do business and have excellent delivery capabilities in specific niches. They are cheaper than full-service providers but don't have their scope.

Emerging offshore. These smaller offshore firms have only recently entered global markets and are less familiar with business environments abroad. They offer cheap rates and are hungrier for business than better-known firms. Unfortunately, their delivery capabilities vary widely, and it may be difficult to evaluate their financial viability or expertise. Use such providers to reduce costs on targeted, controlled projects. They shouldn't be entrusted with large-scale projects because their pockets aren't yet deep enough.

Experimental offshore. These very small firms are generally body shops competing almost exclusively on price. They serve primarily as subcontractors to larger providers. Unless you have deep ties in their home countries, it's difficult to get accurate information on their expertise, delivery capabilities or financial stability. Avoid using experimental offshore providers unless you know exactly what you're getting, have an extremely tight rein on the project - and can tolerate some surprises.

Each category of offshore provider has arisen to meet a market demand. Make sure that your offshore choice takes into account your organization's tolerance for risk and aggravation, not just the desire to reduce costs. Choose a vehicle that will leverage your offshore efforts by providing the best chance for success on distant shores.

For details read here.

Offshore software development

In Offshore Development, you don't have direct contacts (face to face) with the clients. So the contact with the client must be made through internet e.g. E-mail, chatting etc. In offshore software development, first of all you need to organize everything that is required for the project.

Your first step is to collect the information from the client, such as what is the purpose of the offshore project that he needs to get developed, ask him to provide you vital statistics of the project. Also get the details of the system that already exists and need to make changes in that. If yes, then concentrate on the drawbacks of the old version so that you can overcome those and provide better solution to them.

Understand the requirement properly, have discussion on that. Create a list of software and hardware that will be required for the offshore project under development at your end. As an offshore developer, you must have to take care about the time required for the development of the offshore project.


As your client and you as an offshore developer, are at different places, you need to make sure that you provide all the support required for the offshore project that you have developed. Sometimes you may need to provide him online support. It is your sole responsibility to do that. It will be very appreciable by the client, if you stay in contact with him for the technical support for at least 6 months.


Documentation is the most important thing in offshore project development. You will need to provide your client with all the documentation of the offshore project you have developed. Documentation may contain the following:

1. Requirement Analysis.

- Need for System

- Resources

- Hardware, Software requirement,

2. System Design :

- Databases management,

- Entity Relation ship diagrams (Entity Relationship Diagrams),

- Data flow diagrams (Data Flow Diagrams)

- Advantages and Disadvantages of the software

- Pictorial representation of the project.

3. Existence of the old system and its limitation.

4. Proposed system.

5. Software Testing Report

6. Help System of the project

7. User Guides in PDF format.


Maintenance of the software plays the most important part in offshore software development. Once the software is developed, it needs maintenance till the people who are using it are well experienced. There will be a possibility that some bugs will come up after the software has been installed on the user's machine and you will have to fix the bugs. It means you will be needed to solve the problems that may occur. This can be done by providing the client a maintenance support for one year that will be called "Warranty Period". During this time you will have to provide the technical support.

After the Warranty period is over, you may have to make agreements for the maintenance of the offshore software developed. This will be the Annual Maintenance Contract, which will get renewed every year, if the client needs you to help on the offshore project that you have developed for him.

For more details read here

Sunday, April 23, 2006

Managing Outsourcing Relationships

Growing dissatisfaction

There is growing dissatisfaction with outsourcing relationships as per research reports. This dissatisfaction can be attributed to a number of causes, related to both the parties' to outsourcing.

* Unrealistic expectations of the customer due to over promising during sales process.
* Divergent interests of the customer and the provider.
* Inflexibility to align the outsourcing relationship to the change in business needs.
* Cultural gap.
* High rate of turnover of people managing the outsourcing process.

Outsourcing is not just a contract signed between two parties. It is a relationship, which has to be managed from day one of the contract. Successful outsourcing relationship requires a lot of professionalism and good management. While fundamentals of good management don't change, the way they are executed changes to a great extent.

Importance of outsourcing relationships

Management of outsourcing relationships is important because it ensures maximum value from the investments made and enables to give world-class services to its customers. World-class service can be provided only if the IT vendor delivers. In effect, the software outsourcing service provider becomes key to the business success of the outsourcing client.

Managing the relationship right at the start

The foundation of successful management of an outsourcing relationship is laid when a company begins to communicate to potential suppliers about its intention to outsource certain functions.

Successful management of outsourcing relationship depends on the way the requirements are defined, the way the objectives are described, the way a vendor is chosen, and the way a Service level agreement is written. The people who are selected to manage the relationship are also of prime importance. Continuous improvement should be defined and expected.

Managing successful relationships requires a new breed of managers

Outsourcing success depends a lot of general management skills rather than technical or operational skills.

* Negotiation skills: To negotiate on a day-to-day basis to keep the services provided in line with the services required.
* Communication skills: Outsourcing managers are basically a bridge between the organization's business needs and the providers' services. Communication becomes the essence of a successful outsourcing relationship.
* Business skills: To continually understand the changing business needs and aligning the services as per the business objectives.

Involvement of top management

The top management must be involved in reviewing the relationship and giving it a proper direction. Senior management plays a critical role in communicating the reasons and results of outsourcing across the company.

Managing outsourcing relationships like any good management is hard work. It requires constant attention. It requires an expectation of continuous improvement and a proactive approach toward achieving it. Both partners play an equally important role.

Future of Outsourcing

Outsourcing is here to stay. In a highly competitive business environment, companies need to stick to their core competencies and go for strategic outsourcing to reduce their costs and become more effective in their services to their customers. Outsourcing will be looked at as an essential business skill. A companies' success in managing their outsourcing relationship will determine its business success.
For Details read here

Saturday, April 22, 2006

Outsourcing Offshore: a Forced Trend?

The benefits IT can provide a company, independent of its size, are common knowledge, as are the rapid changes in the IT field. The effectiveness of outsourcing is also well documented.

It is generally held as a good idea to turn IT operations and especially IT development over to external providers, as it significantly saves on staff, equipment, training and maintenance, as well as it allows customers to concentrate more on business. However, the lack of IT professionals in developed countries reached critical proportions, with 340, 000 vacant IT positions in the USA alone. This fact makes outsourcing increasingly challenging and expensive. The solution is, therefore, to go offshore.

Offshore development is usually defined as the practice of moving software and other IT work, such as project analysis, design, coding, testing, and maintenance from companies in developed countries to software companies in low-wage areas. Nearly all of the Fortune 500 companies use offshore development services or have their own branches set up offshore. Major hardware and software giants like Microsoft, IBM, Apple, Novell, Sun and Siemens have extensive offshore operations. Many of the world's famous software applications are developed offshore, either partially or completely.

Offshore operations can provide a lot of benefits, including:

Technical Competence: top IT professionals are available offshore and they can work for you.
Quality: customers can be assured that their projects will be done on time and according to the highest quality and technical standards.
Costs: customers are sure to save at least 50 per cent of all expenses if development is done in-house, not even taking into account the expenses on infrastructure and equipment.
Start-up time: it is usually much easier and faster to start up a project offshore than in-house. Besides, offshore companies can take projects at any stage.
Protection: all intellectual property rights will belong to the original company.
Financial protection is also guaranteed as payments are made only when specific milestones have been achieved. In addition, it is quite usual now for offshore companies to offer fixed-price solutions on guaranteed deadlines.

There may be several obstacles as well.

Cultural differences, inadequate project management and communication problems are among the most common. However, cultural differences and management problems can be overcome by keeping a tight control over a project from the site. Offshore houses can even adopt the standards and procedures of the customer's company. Communication would not seem to be not a problem anymore: electronic communication and, if really necessary, on-site support can solve it. It no longer matters whether the development staff are located the other side of the town or the other side of the world. Offshore companies are aware of these problems and they do their best to eliminate them, co-operating with the customers.

You can outsource offshore many types of work such as client/server and Intranet systems, advanced engineering and system integration, consulting and re-engineering, customisation and localisation, testing and bug fixing, multimedia and Web design, data entry, processing and conversion.

But there is another strategic problem: what is better, to develop a custom solution or to rely on packaged applications? Of course, there is no universal answer, but whatever your choice is, you should keep in mind that effective use of packaged software also requires planning, consulting, system integration and quite often customisation or enhancements. Again, you will need help and offshore companies could be a solution.

For details read here

Wednesday, April 19, 2006

How to avoid being taken by sharks in offshore waters

Offshore financial centers have attracted everyone, from the small investor to the large multinational corporation eager to take advantage of low tax regimes to legally maximize profits while minimizing taxes. Often, zealous investors, all too eager to access new opportunities available to them, fall prey to sophisticated schemes designed to bilk them of their cash. The Internet grants easy access to a huge variety of new investments but does not separate the legitimate from the illicit. Many are the hapless investors who have fallen prey to these offshore sharks with little recourse but to write the experience off as an expensive lesson in the school of hard knocks. Understanding the modus operandi to schemes that make exaggerated and impossible claims assist those who venture into offshore waters to recognize a potential scam before its too late. Here are examples of some programs that have been uncovered and techniques by law enforcement officials and investment authorities to help prevent the offshore investor from becoming shark bait.

Log on the Internet, go to any one of the major search engines and type in phrases such as "Prime Bank Notes" or "High Yield Investments" and your screen fills with investment possibilities beyond your wildest dreams. Herein lies the problem, because they are mostly pipe dreams!

The Pitch

There is a little known, but lucrative, international investment. This investment involves the trading of bank credit instruments (debentures), also known as known as "deferred payment," "delayed payment," or "stand-by credits." Until recently, trades were only available in minimum blocks of $100 million, but certain developments have allowed small investors to qualify. Profits range from 400% to 2,000% or more per year. The trading in "bank debenture instruments" is a multi trillion-dollar industry worldwide. Top world banks (Money Center Banks) are authorized to issue blocks of debt instruments like Bank Purchase Orders (BPOs), Promissory Bank Notes or Bank Debenture Instruments (BDls) under International Chamber of Commerce guidelines (ICC -400 & 500).

The Bait

The program offers monthly investment options with returns ranging from 7% for a minimum $100 investment to an incredible 40% for a $10,000 investment per month! The larger the sum, the greater the return. Turn a minimum $200,000 into a cool $53 million in just 40 weeks. Who needs the lottery!

We had a call recently from a fellow in Florida with two palls on the West Coast claiming to have invested $75,000 each in an offshore investment pool which guarantees them 50% return on their investments per month. We told him that unless he had savings to lose, to hang back and let his palls take the beating they were almost certain to experience.

Other investments offered are self-liquidating loans (loans that never have to be paid back), stock and commodity investments offering 20-60% profit per month with a ration of 60:40 winners to losers. The possibilities were endless.

How could anyone fall for a promise to return more than 2000% per year? How about turning $200,000 into $53 million in 40 weeks! It is strictly a numbers game for crooks. If just 1 in a million fall for the scheme, the con artists make a killing thanks to a potential market of hundreds of millions on the Net. Often, those caught in the traps can least afford it but many well-heeled investors also fall prey every year.

Bank Roll or Bank Debenture Programs

Perpetrators of this fraud use banking and investment jargon to confuse and impress their victims. According to the FBI, the promoters purport to have access to "bank guarantees" which they can buy at a discount and sell at a premium. By reselling the "bank guarantees" several times, they claim to be able to produce exceptional returns on investment. For example, if $10 million worth of "bank guarantees" can be sold at a two- percent profit on ten separate occasions, or "traunches," the seller would receive a 20% profit.

Such a scheme is often referred to as a "roll program." To make their schemes more enticing, con artists often refer to the "guarantees" as being issued by the world’s "Prime Banks," hence the term "Prime Bank Guarantees." Other official sounding terms are also used, such as "Prime Bank Notes" and "Prime Bank Debentures." Legal documents associated with such schemes often require the victim to enter into non-disclosure and non-circumvention agreements, offer returns on investment in "a year and a day" and claim to use forms required by the International Chamber of Commerce (ICC). In fact, the ICC has issued a warning to all potential investors that no such investments exist. Such documents are impressive and look real but are usually phony or have escape clauses in favor of promoters that render them unenforceable by the victim.

The purpose of these frauds is generally to encourage the victim to send money to a foreign bank, where it is eventually transferred to an offshore account that is in the control of the con artist. From there, the victim’s money disappears.

The jargon they use can be convincing to those not familiar with commercial banking terms. While foreign banks use instruments called "bank guarantees" in the same manner that U.S. banks use letters of credit to insure payment for goods in international trade, such bank guarantees are never traded or sold on any kind of market.

Investors are encouraged to initially put up a small investment of $1,000 which "returns" $1,500 the following week. Impressed, the investor then puts up $20,000 and is returned $30,000 in a relatively short period of time. The hapless victim is then pushed to put up all he can, often investing $100,000 to $200,000. After a series of delays that may last a year or more, the victim is told the deal "fell through" and it was just bad luck. He is encouraged not to say anything because what he did was illegal, especially if he went along with the con artist’s idea and set up an offshore corporation or trust to evade paying tax on the promised gains.

Selling the sizzle is what these con artists are good at, and the good ones ply their trade with all the finesse and confidence of Wall Street promoters. The programs have been around for years, but like the well-known Nigerian 914 Scam below, they continue to catch new victims. According to the International Chamber of Commerce ‘s commercial crime bureau, bank debenture-type programs cost investors in North America more than $10 million U.S. in loses per day! Victims rarely come forward as they are either too ashamed to admit their blunder or fear attracting the attention of tax authorities for attempting to evade taxes.

High Yield Investment Programs (HYIP)

Recently, a fellow from Jamaica sent an urgent email asking that we check out a company he had seen on the Internet offering 20% per month on a minimum $100,000 investment. He wanted an answer immediately claiming he had to wire the money to them that day. A phone call to the London number produced a return call from a certain "Chris" in Nevis who refused to give his last name or phone number. We were asked to sign and return a "confidential" non-disclosure agreement to the company and then all our questions would be answered. Our money was to be invested with a Nevis trust company that would forward it to a New York broker who would in turn invest in the U.S. markets. All was done with complete anonymity and privacy. There are no income taxes in Nevis. Paying our taxes was our business we were told. When asked about security, "Chris" explained that once they received confirmation of funds from our bank, we would be given the proper documents. The episode had all the properties of a fraud. We warned the eager investor accordingly.

The Advance Fee Scam

This scheme has become increasingly popular because it usually involves amounts under $1,000. It occurs when the victim pays money to someone in anticipation of receiving something of greater value, such as a loan, contract, investment or gift, and then receives little or nothing in return. Victims rarely complain to authorities due to the small amounts of money involved and because con artists shift the blame to the applicant for failing to meet a list of requirements in an application that are impossible to fulfill.

Examples include offshore credit and debit cards, self-liquidating loans, investment loans, and a variety of other promotions. The variety of advance fee schemes is limited only by the imagination of the con artists who offer them. They may also involve the sale of products or services, the offering of investments, lottery winnings, "found money," or a myriad of other opportunities according to the FBI. Clever con artists will offer to find funds to loan to their clients who pay a "finder’s fee" in advance. "Clients" are required to fill out applications and sign contracts in which they agree to pay the fee upon introduction to the financing source. Victims often learn that they are ineligible for financing only after they have paid the finder’s fee according to the contract. Such agreements may be legal unless it can be shown that the "finder" never had the intention or the ability to provide financing for the victims which is next to impossible to prove.

The Nigerian or 914 Fraud

More than $5 billion US has been stolen from victims of the Nigerian Scam since it was first reported in 1989. It has been run for the last ten years under successive governments of Nigeria. It is also referred to as "Advance Fee Fraud", "419 Fraud" after the relevant section of the U.S. Criminal Code of Nigeria, and "The Fax Scam."

Much has already been written about this fraud and the many forms it takes. The target receives an unsolicited fax or letter from Nigeria containing either a money laundering or other illegal proposal or he may receive a seemingly legal and legitimate business proposal by normal means. Generally, the victim is encouraged to give access to a business bank account so that funds being moved out of Nigeria can be deposited there temporarily. The victim is promised a commission of between $2 million to $25 million. Once the criminals gain access any funds in the accounts are removed. The fraud often involves an advance fee being paid to help facilitate the transfer. According to reports, this scheme is the third largest industry in Nigeria! More recently, a new twist on Nigerian Scam has surfaced. Reports received by INTERPOL indicate that the criminals are becoming so brazen and confident that they are contacting earlier victims of the fraud and are posing as Nigerian government officials investigating the fraud in a so-called attempt to get the victims’ money back upon payment of an up-front fee.

Abusive Trusts

The Internal Revenue Service is again reminding consumers not to count on "abusive" trusts to help them evade income taxes. Real trusts are used mainly to avoid estate taxes or probate after death, but trusts cannot be used to lower current income tax burdens for the settlor (one who creates the trust).

An abusive trust is usually expensive and promises lower taxes without loss of control over assets. True ownership of assets or the size of income is hidden. A promoter agrees to sets up the trust for a taxpayer who transfers assets to the trust. The promoter either acts as trustee or provides another individual for the task while providing a means of accessing those funds such as a credit card secured by the money in the trust or pre-signed blank checks.

In the case of business trusts, often payments are made to the taxpayer as dividends that are labeled as business expenses. The original owner is assured that he will have full access and control of the money. In these cases, the person who set up the trust (grantor) is responsible for paying the tax and failure to do so constitutes tax evasion. Failure to report a foreign trust is also required.

There are many types of trusts, whether legal or abusive. Businesses are placed in business trusts or unincorporated business trusts. The machinery used by a business is usually placed in an equipment or service trust. A house is placed in a family residence trust and personal property or income is often placed in a charitable trust. In some states, unincorporated business trusts can be used to limit state business income tax liability but they can never be used to limit federal income tax liability.

Charitable trusts are used by people who want to give their money to charity when they die but still want to use it while they live. The taxpayer pays income taxes but avoids probate taxes. The problem comes when trusts are misused in an illegal attempt to avoid income taxes.

For the victim, the cost will be more than he bargained for. Once assets are transferred to the trustee, he is granted wide powers to control the funds as he sees fit. In a legitimate trust situation, the trustee is bound by a set of strict rules designed to protect the assets. In an abusive trust, such controls rarely exist leaving the assets vulnerable to theft.

For both promoter and victim, if caught, the price can be high. According to the U.S. National Fraud Information Center, in a case brought by federal prosecutors, James Noske was convicted of setting up these trusts for others and sentenced to serve 6-1/2 years in prison by a federal judge. Those caught using trusts to illegally avoid paying taxes, the government must be paid the original taxes with interest plus fines plus an additional penalty of 75% of the original tax. You could wind up paying more than twice the original tax when it’s all over.

Similar fines and penalties exist for Canadians participating in abusive trust arrangements and Revenue Canada has added more than 1,000 new international auditors to help catch such perpetrators. The Federal Bureau of Investigation, Internal Revenue Service, Royal Canadian Mounted Police and Revenue Canada regularly monitor the Internet to identify abusive trust schemes.

The Pen to the Rescue

His motto is "the pen is mightier than the fraud" and his weapon the written word. Publisher of Offshore Alert, a newsletter with a mission to expose fraud and corruption in the major Caribbean financial centers, David Marchant warns investors of investments that he believes are less than above board.

In March, he reported on irregularities he’d discovered in Panama at a well-known firm providing offshore trusts, corporations and investments to clients, mainly from North America. The company, with an impressive array of web sites selling everything from mini-trusts to books on how to stop paying taxes, advertises itself as "the largest independent provider of independent financial services in the Caribbean and Latin America." Marchant claims that he has uncovered a massive Ponzi scheme being offered to clients and that they have been defrauded of millions of dollars. Through sources, he says he has proof that the company is insolvent with more than $25 million in debt due to the president’s siphoning of client’s funds.

The company responded with a $30 million lawsuit against Marchant alleging negligence. Marchant continues to report on his findings undaunted. Panama’s Republic daily newspaper and the June 1 edition of Business Week Magazine also carried the story. Business Week stated that the president of the offshore company together with another offshore consultant, well known for setting up banks for clients, were responsible for setting up banks in Montserrat later closed down by regulators, losing millions for depositors; the majority of whom were low income Americans.

Marchant also reported about a seminar in Nassau, Bahamas, sponsored by another well-known offshore services company where the seminar speaker was caught effectively promoting tax evasion schemes to a predominantly American audience. The speaker had been employed by a high-profile US investment firm and was promptly fired.

An Ounce of Prevention

Reading publications like this and others will help investors avoid potential offshore pitfalls but there is no substitute for a thorough due diligence and straight common sense. Understanding the techniques used by con artists helps the investor avoid falling prey.

Here are some tips from the FBI and offshore investment professionals.

1. If the offer of an "opportunity" appears too good to be true, it probably is.
2. Know whom you are dealing with. If you have not heard of or are not familiar with a person or company that you intend to do business with, do your homework. Visit the business location, check with the Better Business Bureau and consult with local banks, an attorney or the police. There are also professionals who will help you do a due diligence for a fee. Investing $200 in getting help before you invest is much cheaper than hiring attorneys and private investigators to track down your money after its gone.
3. Follow common business practice. Would you invest money with someone who was unwilling to provide you with a last name, references and a contact number?
4. Make sure you fully understand any business agreement that you enter into. If the terms are complex, have them reviewed by a competent attorney.
5. Be wary of businesses that operate out of post office boxes or mail drops and do not have a street address, or of dealing with persons who do not have a direct telephone line, who are never "in" when you call, but always return your call later.
6. Be wary of business deals that require you to sign non-disclosure or non-circumvention agreements that are designed to prevent you from independently verifying the credentials of the people with whom you intend to do business. Con artists often use non-circumvention agreements to threaten their victims with civil suit if they report their losses to law enforcement.
7. Avoid anyone who encourages you to break the laws of any nation or where the investment relies on complete secrecy. Falling for this trick gives the con artist leverage against you. Like a trap, he will spring it on you later insuring your silence when he steals your money.
8. Determine your security before spending a lot of time and money investigating the offer. If you are being asked to entrust your money to someone else whom you don’t know, be suspicious. The stage is set to have your money stolen from you without recourse.
9. Be wary of any offer that pressures you to make a decision in a short period of time. Often this is to prevent you from asking about the company and doing a thorough due diligence.
10. Trust your gut. If your "little voice" is warning you to beware, don’t get involved until you feel comfortable. Often greed can overwhelm common sense and this is always a mistake.

There are many legitimate offshore service providers who offer legal methods of helping you discover excellent legitimate investment opportunities without excess risk to your assets. Many of them appear as authors of expert articles in the archive on our website which you may research for very modest fees. With the right guidance, you will be well on your way to utilizing the many opportunities that await you offshore.

For details read here

Monday, April 17, 2006


Programmers and developers outside the U.S. are currently in a position to take advantage of a rapidly growing realization by U.S. companies that software can be created and maintained offshore in other countries at a fraction of the cost of having it done domestically.

U.S. companies are becoming increasingly more comfortable with the concept of offshore outsourcing. They can clearly see the benefits. Costs can be up to 70% lower, work quality can be on par with that of local or in-house developers, and risks can be low.

Although many U.S. companies are now using offshore resources for project development and support, the overall number is relatively small when compared to the potential. However, that number is growing at an ever-increasing rate as this strategy becomes more accepted as a normal way of business in the U.S.

As more companies achieve success in using this methodology, other companies will be encouraged to use it themselves. In fact, many companies will find it necessary to use offshore resources simply to maintain a competitive position in their area of business. Some will see it as a survival tactic.

This represents an enormous expanding opportunity for offshore talent. Never have the possibilities been as great as right now

In order to take advantage of this opportunity; offshore programmers, software developers, and Internet designers must fully understand how to do business with U.S. customers if they want to be successful. This means understanding the customers’ needs, his concerns, and his business methods.

For details read here

Sunday, April 16, 2006

Making Offshore Outsourcing Work

Although there are plenty of obstacles to offshore outsourcing, it doesn't look like the trend to outsource is slowing. According to Gartner (see note), "some 150,000 to 200,000 people are employed offshore in the call and contact center business, predominantly in India, the Philippines, Ireland, and a host of emerging destinations across the world." This does not include all of the software development that is also being done offshore.
To make offshore outsourcing work for you, define your strategy before moving forward, and recognize that outsourcing is about more than just costs. Achieving the right balance between local sourcing and outsourcing for your organization enables you to focus on the critical issues and leave the repetitive or commodity services to the outsourcing provider. Be sure to secure solid service-level agreements, meet as many key people in person as possible, and institute a process of regular communication between you and the provider. Above all, keep in mind that your customers want to have a seamless, helpful experience—and no matter how much you're saving, if customers are unhappy, they'll go away
For more details read here

Saturday, April 15, 2006

Outsourcing Software Development to IndiaWebDevelopers

Once you are convinced that outsourcing is essentially the best bet for your company, the critical question is - whom do I outsource to? You know that choosing the right partner can put you onto an expressway to growth and financial success.

Based on this understanding, you could spend the next few months wading through realms of data to find that right partner, or you could consider IndiaWebDevelopers, a 6 year old web development company with a track record of successful project implementation to clients across the world.
We are the one you are looking for if:

* You want an outsourcing partner who has both experience and expertise
* You are looking for an ethical outsourcing partner who is reliable
* You are looking for long term relationships
* You want a risk free outsourcing experience
* You don't want to have sleepless nights thinking about information security and failure of outsourcing projects

Here are a few reasons why outsourcing to IndiaWebDevelopers makes business sense:

* Because you need an expert
* Because you believe that doing business online should not cost you an arm and a leg
* Because you would like some control over the development of your web site or application
* Because you prefer to manage your business, not your software vendors
* Because your success is ensured with a successful partner

1. Because you need an expert

IndiaWebDevelopers understands that as a businessperson, you expect your software partner to be more than just someone who simply does what he's been told. As experts we understand that we have a responsibility give you value additions by responding to your ideas with enhancements, options, suggestions and even warnings, where necessary. Since 1999, we have walked the talk - using the Internet to acquire projects, execute and deploy a majority of our 140 projects completed so far for clients across all continents. As an organization dedicated to better software development, we keep track of new developments in processes and products that will help your business do better. Unlike in-house development team, our employee Enhancement policies ensure that our team update themselves through Brain Bench or Microsoft certifications in their respective areas of expertise.

2. Because you believe that doing business online should not cost you an arm and a leg.

Based in Bangalore , India (the Silicon Valley of Asia), we can offer you the twin advantages of affordable costs and high quality. Thus custom ecommerce projects that in the US / Europe cost in the range of $250,000 to $500,000 can be developed at a fraction of the cost when developed in India . No wonder Microsoft, Intel, IBM, Cisco, Yahoo, Amazon, Google, GE, Reuters, HP, Dell and Oracle find outsourcing to India works! Leading software consultancies such as McKinsey and Forrester have declared that India is now the global hub for software development and software enabled services. Combined with the advantages of the world's second largest pool of English speaking scientific and engineering talent, lower costs of living and strong Government backing for the software sector, it's not surprising that IndiaWebDevelopers can pass on the outsourcing benefits while still remaining profitable.
3. Because you need control over the development of your web site or application

Since we work from the Business Vision , all we really require to start is to clearly understand your business model. But in order to ensure that you are kept informed on the progress of the application and provide opportunities to give feedback and inputs, we encourage you to approve, sign off or discuss changes at key points during the course of the development cycle . At each key point, we take the time to discuss the work completed thus far with you and will proceed with the next stage only when you are completely satisfied with the work completed. On fixed scope/ fixed price projects, IndiaWebDevelopers also offers a phased payment schedule that not only smoothens out your cash flow, but also ensures that you pay each installment only when you approve the work done in the previous stage.
4. Because you prefer to manage your business, not your software vendors

Making a website successful takes more than just good programming. It needs to be hosted with a reliable service provider, promoted, updated, maintained and backed up by competent support staff to manage the suggestions, complaints and questions that invariably come with any successful online venture. At IndiaWebDevelopers, we understand that our success comes with long-term partnerships with clients who succeed. We believe that you should get the time you need to focus on building your business, and we will give the best in what we are good at.
5. Because your success is ensured with a successful outsourcing partner

Statistics from the US Small Business Administration show that more than two thirds of all small business who have successfully developed ecommerce solutions go on to earn more that what they spend on developing the website. As you grow, you need a partner who will be around tomorrow to ensure that your software and websites adapt to reflect this growth. IndiaWebDevelopers has had continuous 80% plus growth since it's inception in 99. That's because we have been constantly upgrading our capability to provide better-designed applications - thorough a focus on better people, better processes and better tools. So wherever you go and however big you become, you know you'll have a partner who'll grow with you.

for details read here

Wednesday, April 12, 2006

Outsourcing Without Upsetting Lou Dobbs

I don’t know how many times I’ve flipped through the channels and heard Lou Dobbs talking about “Exporting America.” Now, I know Lou is discussing the political and economic context of American companies outsourcing their jobs overseas. However, this new one-dimensional definition of outsourcing has other implications to some of us in the States.

I am no expert on politics, economics or Lou Dobbs, so I’ll keep my opinions on those subjects to myself. However, what I would like to discuss is the negative connotation that the word “outsourcing” has taken on in this country.

There are thousands upon thousands of small businesses in this country whose sole survival depends on other companies outsourcing their needs. Just think about it for a moment. How many companies in the service industries only exist to support the needs of other businesses?

Imagine if every company had to act as a fully self-sufficient corporation. They must handle all of their own HR issues…no more employment agencies, payroll companies, etc. They must employ a full-fledged IT department to handle all of their own web design, networking, software and database designs. Each enterprise has to have enough administrative assistants, data entry specialists, desktop publishing experts, marketing gurus. The list is endless.

If American companies were to completely eliminate all forms of outsourcing, life as we know it would end!

Now, we all know that this is not what Lou or anybody else who has defined outsourcing as one of the most popular buzz words of the last few years is talking about. I understand that most people know that the business to business outsourcing within America is not a bad thing. Nonetheless, it seems strange to me that one word can take on such a life of its own. It’s really not a new phenomenon, yet it is the first time that I’ve encountered one of these controversial terms in my own ventures.

Let me say that as a business person in a field that is solely based on other businesses looking to my company to meet their needs, I find myself quite often searching for synonyms to outsourcing. Not that there’s anything wrong with it, but when I’m advertising, I’m forever brainstorming for words to replace that one that starts with o and ends with source! After all the talk that’s been spinning around Washington and the rest of the country, it seems that it’s turned into a dirty word.

Obviously, most people understand that there are all types of outsourcing. On the other hand, when you’ve got limited time and space are you going to choose a “hot button” word to describe what you’re selling?

Dana Wallert is the owner of DW Office Solutions, an online virtual assistance company. She has many years experience in sales, non-profit fundraising, as well as office management.

Monday, April 10, 2006



Sunday, April 09, 2006

Software Outsourcing and its Future

A report by research and consulting firm Forrester Research mentions that, jobs which are lost in United States because of Software Outsourcing are primarily low salary IT jobs. These jobs are like software programming or software consultants or computer operators. But on the other hand, high end high paying jobs like system analysts, network analysts and research analysts have seen continuous and stronger growth. Jobs in this niche market are growing steadily at the rate of 4 to 5% every year. These jobs which require stronger domain knowledge and knowledge of internal working of IT systems and business process are difficult to software outsource.

Jobs for software engineers for the position of system analysis and application development implementation are also growing at the rate of 6% a year. This is because, though software outsourcing can be done to India or other offshore software development locations, customers require in-house staff for customization and maintenance of purchased software.

Why Software outsourcing will decrease ?

Report also mention that, attraction of cost saving in software outsourcing is yet very high and because of that, increase in jobs like software programmer will be very minimal. Also, because of very low increase in software programming jobs, salary rise will also hardly 1% in next few years. Salary of computer operators and database administrators will also grow at barely 1% rate. On the other hand, report also mentions about jobs which will have highest salary rise. Salaries of computer research scientists and information system managers will have highest growth which will be around 3.5% every year. While salaries of analysts and system administrators will grow at the rate of 2 to 3% every year.

Conclusion about offshore software development

Report concludes with note that software outsourcing which has major costs saving today will decrease by 2008. Because, in United States the salary rise is very-very less as compared to other countries. While in India and other offshore software development destination, because of lack of availability of resources, salary rise will be very high. This will decrease the difference between salary of Indian and US software engineer and eventually decrease costs saving. So many companies will prefer in-house resources rather then Software Outsourcing.

For details read here.

Wednesday, April 05, 2006

Offshore Development

Offshore development may seem as if it is a recent trend in business management but contrary to this, the concept has been around for many years. Business process outsourcing (BPO) to other countries has been the solution for many manufacturing and information technology firms in reducing operational costs without sacrificing the quality of the product or service. In addition, offshore development establishes a good international relationship for both countries involved. This is because the outsourcing country helps increase the employment rate of these countries by creating new job vacancies for thousands of talented yet unemployed people.

The manufacturing industry has seen a trend in this over the last decade, with a number of companies handling the design aspect for their garments in Europe, and the actual manufacturing in developing countries such as India, South America, and South East Asia. The notable local talent as well as professional competency in these countries , in line with the lower costs have proven to be a winner, attracting more western software development companies to set up operations in these developing economies.

Similarly, this trend has also become the Internet standard in recent years, as seen in companies such as www.444.Net. Developed by the Dutch - Belgium management team headed by Danny Wirken and Luc Jansen, 444.Net executes their online businesses from developing nations such as Venezuela, Colombia, India and Bulgaria.

In a nutshell, offshore development does not only help promote business growth for a business. It also enriches the lives of people in countries with a lower employment rate. In effect, global cooperation and partnerships blossom and pave the way for even more international business.

For details read here.

Tuesday, April 04, 2006

Engineering Job News: Tips To Survive Offshore Outsourcing

The cheap labor costs of Southeast Asia are like a siren call to more and more US employers seeking to lower support costs and improve profits. The increasingly common trend toward outsourcing labor to countries such as India, Malaysia, and Pakistan means jobs are leaking to a part of the world where workers fresh out of college or technical school will work for pennies on the dollar compared to American workers. For the American workers, that means the bar for entry-level positions is rising or the same positions are disappearing off the map completely. What can you do to avoid losing out to offshore outsourcing ??

Don't become a target.

What should you do if you find yourself facing joblessness due to outsourcing? Many would say make yourself indispensable, but is anyone ever really so valuable that they are indispensable? What makes someone indispensable in a software development company that has 1500 software consultants ? Few things, but some key skills can give you an edge. Skills such as bilingualism, abilities with key or rare equipment, skills with software that is either so cutting-edge or so old that only a few can manipulate it well ¼ skills that will make you stand out in an ocean of other employees.

Move up the ladder rapidly.

Another way to deal with outsourcing is avoidance. Jobs that are outsource-able are not key positions in the first place. Therefore, the key is to rapidly move out of entry-level positions into positions that are less likely to be outsourced. Look around you. If you are in a company in an entry-level position that has 50 to 100 other people doing the exact same tasks you are doing, you may very well be in a Danger Zone for having your position outsourced. Make it your mission to get out of that huge fish barrel of low-skilled fish and into a position that can only effectively be done on home turf as rapidly as possible. Get promoted, get higher training or education, or go for a position that is more specialized.

Go smaller.

Consider changing jobs to a company that is smaller or more niche-oriented. Smaller companies generally do not outsource due to decreased cost effectiveness and often because they have a closer relationship with their customers. While offshore outsourcing may save dollars and improve stock prices, it often has detrimental effects on customer relations. Small companies cannot afford to lose customers because of poor customer service or language barriers and are therefore less likely to outsource offshore.

Go where the jobs are.

Displaced garment and textile workers in the Carolinas and other Southern states were left jobless almost overnight in the nineties when their employers moved operations to Central America or Asia. Those who did not have transferable skills or were unwilling to relocate were left floundering. Workers who thrived were the ones who learned new skills that were in demand or who were willing to move to areas where their current skills were needed.

Stay on the cutting edge of your field.

Work that is outsourced is generally grunt work that requires a labor force that is broadly skilled in the most common tasks, works with the most common applications, or can handle minimal communication coupled with heavy, repetitive-type work. There is always demand for skilled professionals who can work easily with the latest and greatest technology, who do not fear risk-taking and enjoy the challenge of development and innovation.

Will offshore outsourcing suddenly cease? Not a chance as long as the American consumer continues to demand high-end technology for rock-bottom prices. The race to maintain market share while maintaining profits, demands cheaper and cheaper labor costs. Offshore outsourcing is a solution to that problem. It behooves American engineering and information technology workers not to be a part of the problem to begin with by pursuing education and training that sets them above their offshore labor competitors and takes them out of the fish barrel of low-end, low paid support type positions. America has always been the leader in innovation and development and engineers who concentrate on those areas will always have a place in this economy.

For details read here.

Saturday, April 01, 2006

Outsourcing Your Packaging Is A Strategic Option

In a recent article in "Investors Business Daily", it was revealed that outsourcing has become more than just an easy way to cut costs. It has become a strategic tool that gives businesses flexibility and access to skilled personnel.

Since the advent of the Internet, and the rush to get online, software development companies have turned to outside professionals for services and solutions. Hiring a full-time software consultant is costly and not an efficient use of resources. Outsourcing allows companies to focus on their core businesses while gaining access to skilled labor when they need it.

* Outsourcing is a way to boost revenue
* Outsourcing is a way to cut costs
* Outsourcing eases labor shortages
* Outsourcing cuts payroll costs
* Outsourcing allows companies to focus on core competencies
* Outsourcing reduces or eliminates some capital expenditures

Outsourcing also allows businesses to change their corporate culture. If companies have renegade groups that are costly, ineffective, or difficult to manage, that group can be outsourced. This enables employers to change their workplace environment on-the-fly.

Still, most companies outsource projects in order to reduce costs and to gain outside expertise. A survey by "The Conference Board" indicated the following "Top-10" outsourcing objectives (numbers are approximate):

* Reduce Costs (40%)
* Access to Expertise (38%)
* Improve Internal Service (37%)
* Focus on Core Business (34%)
* Maximize Resources (27%)
* Internal Flexibility (25%)
* Improve External Service (24%)
* Changing Customer Needs (20%)
* World Class Standards (15%)
* Continuous Improvement (15%)

When deciding to outsource your packaging, the real litmus test is whether outsourcing adds value. Does it really reduce costs? Is the investment in in-house training and machinery too great? Does outsourcing a service give you access to people with greater skill sets or companies with more resources available to them?

Bottom line: outsourcing your packaging service needs is about more than just saving money. It is a strategic option for savvy businesses and entrepreneurs.

For details read here.