Nominal directors for US LLC or Corporation

The schemes of obtaining nominee directors, which subsequently have the power of attorney and the ability to manage a bank account on behalf of the representative, do not exist in the U.S. Moreover, in order to open and manage an account in a U.S. bank, it is preferable (de facto necessary, please see “Opening US bank account section”) that at least one of your directors/officers is a resident of the United States.

Some states in the U.S., particularly Delaware, allow companies to not disclose the names of their shareholders. However, the confidentially is only afforded as long as the company continues to operate in the U.S. In particular, it is very difficult to open a bank account without the principal owners of the company.

Despite the fact that some U.S. states allow companies to keep the names of their shareholders confidential and have sometimes favorable tax conditions, it is still not appropriate to refer to these companies as “offshore” in the manner of well-known offshore areas such as the BVI. This is due to the fact that the U.S federal government has established laws to combat money laundering and terrorist financing, and requires the disclosure of “suspicious” bank transactions. In particular, these safeguards are carried out by the banks through the BSA (Bank Secrecy Act) and AML (Anti-Money Laundering).

If a company desires to do business or open a bank account in the United States, it is desirable to have at least one director/officer who is a resident of the United States [1]. In the case of the LLC, the resident can be one of the owners of the company. It should be noted that the presence of a resident within the management of the corporation, or the ownership of the LLC, is not a legal requirement. However, government regulations make the operation of a company extremely difficult if the company does not has a resident endowed with real powers and the status of officer or managing member (for LLC).

For example, when opening a bank account, banks often require a personal tax number (SSN) in addition to the company’s tax number. Additionally, for a non-U.S. resident to open an account, it is necessary to fill out tax form W-8BEN and provide the bank additional information set out within its internal rules. However, the opening of accounts for non-residents (including accounts for the company) is viewed by the banks as a “privilege” and not as a “right”, and thus the bank can always refuse to open an account without explanation. [2]

When filling out the appropriate forms for the regulatory authorities, the director will indicate their contact information and include a phone number allowing them to be contacted by a supervisory authority if necessary. It should be remembered that the director is held personally liable for providing false information.

If the resident director is only serving as a representative (dealing with the opening and maintenance of accounts, reporting) and the actual management of the company is outside of the United States, the director will be subject to questioning on the control structure of the company and the monitoring of the use of its funds. The control over funds transfers can be established though limiting the maximum amount of a single transaction and/or limiting the total amount of transfer in a single day. Control of payment by check can be imposed through restrictions on the maximum amount of a check that can be received by the bank for payment should the check have only one signature.

[1] A resident is described as any person residing in the United States on a legal basis and having the right to live and work in the U.S. In most cases, a resident is a U.S. citizen with permanent residence in the United States.

[2] Details on the procedure of opening a bank account in the U.S can be found in the “Bank Account” section.