For $2,500, a Dallas-based financial services company offers customers the privileges of offshore transactions that were once reserved for the super rich.

A corporation in Belize, a trust in the Bahamas and two offshore accounts, with either banks or brokerages, are all included in Equity Development Group's Complete Offshore Package No. 1.

NYT

From left: Haim Saban, Robert Wood Johnson IV and Michael C. French testify about offshore arrangements.

"Our mission is to make 'going offshore' simple, convenient, understandable and affordable," according to the company's Web site.

"The average person assumes that domestic options are their only options," company founder Samuel Congdon says elsewhere on the site.

Such efforts to bring the offshore world to the masses, or at least to lesser millionaires, have earned Equity Development a place in a scathing U.S. Senate report on offshore tax havens. The report said the offshore industry fuels widespread tax avoidance worth up to $70 billion to the U.S. Treasury.

"Over the last six years, EDG utilized the Internet to provide about 900 mainly American clients, many of relatively modest wealth, with the type of offshore services previously available primarily to high-net-worth individuals," according to the Senate report, Tax Haven Abuses: The Enablers, the Tools and Secrecy.

Mr. Congdon, 33, and his Dallas lawyer, James Lynn, declined to be interviewed for this article. "Nothing personal," Mr. Congdon said. "On the advice of counsel, we're declining interviews."

The Senate report did not accuse Equity Development or Mr. Congdon of specific legal violations but suggested that clients may have used offshore vehicles to break the law.

Mr. Congdon "operated in apparent compliance with current law while facilitating potentially illegal activity," the report said.

Analysts say Equity Development is one of numerous small offshore service providers. Most of the Senate report focused on far bigger players than Mr. Congdon.

Investigators detailed the offshore activities of Robert Wood Johnson IV, owner of the New York Jets football team; Haim Saban, a television mogul behind the hit kids' show Mighty Morphin Power Rangers; and Dallas-based billionaire brothers Sam and Charles Wyly.

All of them deny wrongdoing, saying they merely took the advice of high-priced advisers.

Mr. Johnson and Mr. Saban told lawmakers they were already in settlement talks with the Internal Revenue Service.

The Wyly brothers are under investigation by the Securities and Exchange Commission, a grand jury in Dallas and a grand jury in New York.

The offshore financial industry consists of an array of banks, corporations, trusts and other entities in countries that typically offer secrecy and anonymity to people doing business there. The business thrives from Bermuda to numerous Caribbean islands to the Isle of Man, a small island in the Irish Sea.

Although offshore accounts are legal, many people use them to avoid taxes, launder money or commit financial fraud, the Senate report said.

Other offshore clients may have different aims, such as protecting assets from frivolous legal claims or former spouses.

One potential client told Mr. Congdon that he wanted to shield his assets from his "greedy former wife and her new husband," according to an e-mail message cited in the Senate report.

Some scoff at the notion that reliable offshore services could be had on the cheap.

"It's not worth going offshore unless you are wealthy," said David Marchant, whose newsletter, OffshoreAlert, tracks investment fraud, money laundering and other white-collar crimes.

"Unless you're a millionaire," he said, "there's no need to go offshore, because whatever you save on tax, you're going to spend more than that on advice."

Jay Adkisson, a lawyer with Riser Adkisson LLP in Atlanta, said: "Usually, people who use offshore entities are using it for hide-the-ball tax purposes or they really have no idea about asset protection."

"Often what you have, for lack of a better term, is a bunch of paranoid doctors who think that by having their money offshore, they're protected from creditors. But they're really not," he said.

Mr. Congdon founded Equity Development in 1999 after earning an economics degree from Hillsdale College in Michigan and an MBA from Southern Methodist University and gaining nine months' experience in the offshore service industry, the report said.

"With few resources, no employees and only nine months prior experience in the industry, Mr. Congdon was able to quickly create and promote an online offshore facilitation business that provided a one-stop shop for persons looking to establish an offshore structure," the Senate report said.

Equity Development's offices are located along North Central Expressway, close to SMU's campus. The lobby of its small suite is conservatively decorated, with wood floors and a globe in a floor stand.

Marketing itself primarily on the Internet, Equity Development has served clients everywhere from the United States to Australia to Nigeria, according to its Web site.

Mr. Congdon insisted on personally visiting every financial institution he did business with, according to Equity Development's Web site.

The company grossed several hundred thousand dollars in 2003 and 2004, according to the Senate report.

Customers who opt for the $2,500 packages also pay an annual renewal fee of $1,000 to maintain the accounts, according to the Equity Development Web site.

Equity Development also sold products off the shelf, from accounts in Curaçao for $300 to corporations in the British Virgin Islands for $1,850, according to the site.

Particularly useful for some clients were pre-existing entities called "shelf companies," ideal for clients wishing to show that their offshore entities have been in business for some time.

Belize's Caribbean Software Development Corp., formed in February, is going for $2,500. The asking price for Paducah LLC, which was formed in 2001 on the Caribbean island of Nevis, is $6,000.

Mr. Congdon also dispensed advice to potential clients looking to move assets offshore. Offshore accounts alone weren't private enough, because assets remained under a client's name, Mr. Congdon told clients.

He said he didn't recommend Swiss bank accounts because they "aren't that secure," said an e-mail provided to Senate investigators.

Instead, Mr. Congdon recommended that clients maintain assets in three to five separate countries in offshore "structures."

"The goal is to form a structure that, when put in place, makes a puzzle that is too difficult for any third party [government, litigators, creditors] to put back together," according to Equity Development's Web site.

If Equity Development means to sell offshore accounts as a tax dodge, it doesn't say that on its Web site.

In one e-mail to a potential client, the Senate report said, Mr. Congdon called tax savings an "urban legend." In another, he told a potential client to consult a tax professional.

But older versions of the Web site, which remain in an online archive and were reviewed by Senate investigators, featured what's called an "offshore calculator."

Suppose an onshore account and an offshore account both start with $100,000 and manage a yearly rate of return of 15 percent.

Twenty years later, the calculator shows, the offshore account would hold nearly $1.64 million, while the onshore account would have $964,629.

The difference is due to the 20 percent U.S. capital gains tax, the Senate report says.

Nevertheless, the calculator included a disclaimer, saying that offshore account holders may be liable for taxes, depending on their citizenship and where they live.

The disclaimer also recommends consulting with a local tax attorney or accountant before opening investment accounts in any jurisdiction.

Still, Mr. Congdon and Equity Development have caught the attention of the IRS.

In court filings this year, the agency said it is examining the tax liability of Barringer Financial Partnership LP, which authorities say is another name for Equity Development.

A federal judge recently ordered Barringer to give the IRS the names and addresses of its clients.

According to a court filing earlier this year by an attorney with the Department of Justice's tax division, "the IRS has no current plans to investigate Barringer's clients' tax liability, but it may."

E-mail bcase@dallasnews.com