Survey/offshore funds: Take your pick where you stash your cash

The subsidiaries of investment houses, insurers, banks and building societies may be based in one of several offshore centres, including Jersey, Guernsey, the Isle of Man, Luxembourg, Dublin and even Bermuda. But the choice of of particular centre is largely irrelevant, based largely on historical factors and on covenience at the time the subsidiary was set up. Sometimes, subsidiaries will be established in more than one offshore centre, offering different products and services from the different sites.

Recently, Luxembourg and Dublin have become very popular offshore centres for companies as they can offer Ucits funds (Undertakings for Collective Investment in Transferable Securities).

Ucits are becoming the standard type of fund, sold across Europe. So for a company with European aspirations, this is the best type of fund to offer.

Because of the tax breaks offered by the governments in Dublin and Luxembourg, these are the ideal centres to operate Ucits from.

More than 40 life insurance companies have an offshore branches in Luxembourg, including Commercial Union and Scottish Equitable, while numerous investment houses and banks also have offices there, including Aberdeen Fund Managers, Barclays, Flemings, Fidelity, Foreign & Colonial, GT Global, HSBC, Invesco, Jupiter, Lloyds Bank, Mercury Asset Management, Rothschild and Schroders.

Dublin houses the offshore subsidiaries of equally well known names, including Abbey National, Scottish Amicable, Barings, Coutts & Co, Prolific, Lazards, Irish Life, Midland Life, and Old Mutual.

Jersey has long been one of the world's top offshore centres. It is the home to the offshore offices of many UK companies, including Barclays, Gartmore, Hill Samuel, Lloyds Bank, Midland Bank, Newton fund managers, Perpetual, Prudential, TSB, Flemings and many more.

The other popular Channel Island for the offshore arms of investment houses is Guernsey. Companies with offices in Guernsey include Guinness Flight, Kleinwort Benson, Rothschilds, Credit Suisse Schroders and Lloyds Bank.

The Isle of Man and the Channel Islands are the favoured homes for banks and building societies offering offshore accounts.

Abbey National, Bank of Scotland, Barclays, Halifax, Hill Samuel Bank, Lloyds, Midland, NatWest and the Royal Bank of Scotland are all in Jersey.

Alliance & Leicester, Allied Dunbar Bank, Bradford & Bingley, Halifax, Midland and Nationwide are on the Isle of Man.

The address and telephone number of a company's offshore office can usually be obtained by contacting its UK head office for details.

There are other more exotic locations such as Anguilla, Antigua, the Bahamas, Bahrain, Barbados, Belize, British Virgin Islands, the Cayman Islands, Madeira, Malta, Netherlands Antilles, St Kitts and Nevis, and St Vincent.

But the funds based there are not recognised by the UK Securities and Investments Board (SIB), the main City financial regulator.

Many of the management groups will be unfamiliar to UK investors. Common sense suggests they should not be looked at unless investors have received good advice and know what the risks are.