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Morgan Stanley’s wealth business helped by offshore flows

(Reuters) – Morgan Stanley is attracting new money from international investors who want to move their assets into the United States, a senior wealth management executive said on Monday.

The United States lately has become a haven for foreign money that once went to other destinations because it is getting harder to shield assets from taxes and transparency laws abroad.

“We’re growing our international business,” Shelley O’Connor co-head of Morgan Stanley’s wealth management business, said at the Reuters Global Wealth Management Summit in New York. “We have definitely seen assets increase and…clients wanting to house their assets here rather than somewhere else internationally, whether it be Switzerland or an offshore entity.”

The United States has long been a haven for individuals who want to use shell companies to hide money, or shield them from taxes, because of laws that support corporate anonymity and favorable trust laws in some states.

But many European countries are preparing to set up registries that would make it harder for shell company owners to remain anonymous or avoid taxes. At the same time, there has been an influx of cash from Switzerland after years of pursuit by U.S. tax authorities for the identities of secret bank account owners.

Morgan Stanley, which has one of the largest U.S. wealth management businesses, has been hiring advisers from firms including Credit Suisse Group AG and Barclays PLC who can help grow its business of managing money for international investors, O’Connor said.

Those non-resident advisers, or NRAs, must undergo special accreditation before they can manage money for foreign clients at Morgan Stanley, spokesman James Wiggins said. The bank only manages assets for clients in certain jurisdictions, based on local laws, he added.

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