investment offshore include: Tax advantages - tax regulations often contain provisions to protect against taxation by multiple jurisdictions which can be exploited for legal tax reductions. Nations intentionally attract business investments through lower tax rates. The corporate-tax trend over the period from 1980 to 2010 has trended lower, with the top rate in OECD countries (excluding America) moving from 51% to 32%. Investing in such an environment can improve the investor's rate of return on investment. Investment diversification - risk can be managed by diversifying investments among a wider range of options than are available for onshore investment. Avoidance of forced heirship - inheritance may be passed to the preferred heir, regardless of regulations such as community property laws in the jurisdiction of residence/death. Lower levels of regulation - a broader range of investment options are available (e.g. hedge funds, which thrive in low regulatory environments due to their highly aggressive investments strategies, thrive in offshore jurisdictions, principally the Cayman Islands) Privacy - confidential financial information helps the individual manage taxes on capital gains, income, and inheritance. Specialist financial services - the leading offshore centres have highly developed financial services sectors with expertise in stock broking, asset management, banking, insurance, trusts, funds and legal services. Safeguarding against currency devaluation - As an example, Chinese investors have been investing their savings in stable Offshore locations to protect their against the decline of the renminbi. Arguments against offshore investment Reasons which have been advanced against offshore investment include: They bypass security exchange legislation put into place after the great depression (e.g., the U.S. Securities Act of 1933 and the Securities Exchange Act of 1934) to stabilize the world's economies and establish a fair marketplace. This increases the risk that the financial markets are not properly regulated, possibly increasing the likelihood of bubbles and subsequent recessions. Ethically, it might be considered an abuse of national sovereignty by reducing transparency to regulators of financial transactions. Offshore investments reduce transparency, which abets illegal activities such as allowing investment firms to bypass their fiduciary responsibility and exploit their customers. As an example, it is alleged in a SEC-filed civil fraud suit that Goldman Sachs set up an "offshore deal in which a longtime client, the hedge fund Paulson & Co., helped select and then bet against the securities in the deal without telling investors of Paulson's role." It exploits the advantages created to earn wealth by