[Running Turtles]

This forum is a vast resource for any man, and what we're about to discuss is something we all might have to consider at some point. Asset protection is the act of protecting your wealth and investments from creditors, divorce, inheritence taxes and the like.

This thread is a discussion of:

• Protecting wealth from divorce
• Protecting wealth from inhertience tax, lawsuits, etc.
• The different strategies to accomplish the above and how well they work realistically and legally in your country or the country discussed
  

This is NOT a discussion of:

• Tax evasion (the illegal one)
• Tax avoidance (the legal one)
• Whether or not to get married (beyond the scope of protecting your assets)
  

The above is not to say that you can't favour one plan above another for tax reasons or disregard one because of an increased tax burden, but I want to make it clear that the discussion should be about keeping your assets controllable by you and not about how to avoid paying taxes.

--------------------------------

I'll start off the discussion by describing a hypothetical situation to get the thoughts flowing.

Bob is a 29 year old single man. He has a full time job in which he makes $100,000 per year. This is his first income stream, but he also runs a small company (LLC) on the side, netting him about $50,000 per year on average. He lives in a rented apartment in a European city, drives a car he owns fully and pays himself from his company in the form of dividends.

Bob has a desire to at some point have children. He realises that at he may have to get married in order to make that happen, but is worried that his wife might some day divorce him and take a substantial amount of his assets with her.

To protect his assets, he decides to establish a Panamanian Private Interest Foundation (PIF). The PIF is its own legal person. It can be founded by any person or company regardless of their nationality and can even be founded by a local legal firm in Panama. The Founder of the PIF has full authority regarding the foundation, but he needs to be named publicly.

The Founder however, can name a Protector of the PIF. The protector does not have to be named publically anywhere and Panamanian secrecy laws prevent his identity from being made public against his will. The Protector has full authority over the foundation.

In order to establish the PIF, a minimum capital of $10,000 USD must be invested.

My information about the PIF was taken from this tax advice firm. Please be warned that this is only one source and they definitely have a product to sell.

Keeping the above information in mind, Bob decides to have a Panamanian legal firm found a PIF and name him the Protector. He structures his assets in such a way that the PIF owns all his major assets and rents them out to him. This applies to his cars, a house he purchases and his business. As a person, he owns nothing of great importance and his influence over the PIF is not by any means obvious.

--------------------------------

Fast forward to the future, Bob is now 45 years old. He has a wife, a 15 year old daughter, and a 13 year old son. His wife is "unhappy" and decides she can do better. She files for divorce and would like to take as much of Bob's assets as possible.

In Bob's ideal situation, there is now very little assets to take. She can not prove that she or Bob owns the house (because they don't) and she can't prove that his business,which now pays dividends of up to $150,000 per year to the PIF, is owned by either of them.

How do you think the divorce would play out? What would Bob be liable for? How could Bob protect himself better?

Some members of this forum have substantial legal knowledge in various areas around the world. I would like to hear your input on this if possible. I have an EU flag, but the North Americans and those living on other continents shouldn't feel unwelcome to the thread. I'm using the USD as a currency because it's well understood by everyone and it's very close in value to the Euro at the moment. While solutions may have to be slightly different in some parts of the world, the topic of discussion is a global one.

[RatInTheWoods]

(11-15-2015 07:56 AM)Running Turtles Wrote:  

Some members of this forum have substantial legal knowledge in various areas around the world. I would like to hear your input on this if possible. I have an EU flag, but the North Americans and those living on other continents shouldn't feel unwelcome to the thread. I'm using the USD as a currency because it's well understood by everyone and it's very close in value to the Euro at the moment. While solutions may have to be slightly different in some parts of the world, the topic of discussion is a global one.

In Australia, the "family court" has extra ordinary powers to award all your assets to breast owners.

They can pierce trusts, overturn prenups, make up evidence, ignore facts and make rulings "without the burden of proof" (yes I have seen and been a victim of the legislation).

Basically you can take some measures to make it difficult, or delay. But at the end of the day there is a huge industry set up to strip funds of men and redistribute to lawyers and breast owners, and they are not going to let men opt of of the system with so much easy money at stake.

Any time someone comes up with something, they legislate around it.

I dont know about other countries, but this is my first hand direct experience with the Australian system.

If you are not prepared to loose everything, don't marry or co-habituate with a woman. 18 months co-habitation means you have the same legal status as married by Australian laws.

[SunW]

No matter what system or country you live in, there are only two options for men to protect their assets. I've divorced my wife and experienced no issue, and many men won't be so lucky. I followed the first rule on this list.

1. The entire system is built against you, and if it hasn't changed against you favor, it will. What does this mean? It means that even if you have an advantage for a season, it will eventually dissipate - prenups were once set in stone, now there are ways around them. The bottom line is that there is no absolute legal way to protect you or your assets. If a law gives a man justice, that law will eventually change to screw him. Therefore, holding your tongue will be your key - you need to learn how to protect yourself, but not spread this information because other people have weak tongues - they talk, they boast, and then laws change against them in time.

As a man, you need to learn how to know and do things that only you know. You may have a skill that can earn you $200 an hour, but if everyone knows it, that could haunt you in court when they're appraising your value - and they'll always make it higher than it actually is to give her more. Think of degrees and certifications for a man as easy money for a woman; in my case, I have a lot of skills outside of paper, so on paper, I look like a poor idiot. Most men don't think this way, but you must because other people must think that you'll never have an advantage. I believe it was Heartiste who said women want the upper hand, and in divorce, your ex-wife needs to think this belongs to her; men who go all alpha during divorce, time and time again, get crushed. Basically, what she and others must think is that you lost and big - even if it's not true. This isn't "I'm going to make her eat it!" Nope, you look like a winner, that means you have to give her free stuff. This is what our system is rewarding, so it's not my fault that this is the way things are.

Hold your tongue.

2. A few systems exist that live outside of the control of the current divorce laws. In theory, bitcoin is a system like this, but if you're good, you can trace bitcoin. Dash is like bitcoin, but completely private. Dash achieves what Milton Friedman dreamed of with an economic system where the buyer and seller didn't know each other at all. Both systems carry a lot of risk, though anyone afraid of this shouldn't marry anyway.

This step only works if you do this prior to marrying someone.

Even if men have an advantage in one or two things now, in ten years, they won't. Men aren't fighting the system anymore; most are just accepting the way things are, and even though we have more allies now than before, some men still don't seem to care.

[H1N1]

I specialised in trusts and asset protection, and am a serious Trust law nerd. The government here in the UK has a perpetual social justice crusade to close every single legal loophole they can - including introducing an obligation on all those who provide these services to report new tax avoidance schemes to them for examination of their legality. It used to be the case that Tax Evasion was illegal, and Tax Avoidance was lawful, and those terms had distinct meanings with different legal effects. Now, given the stigma associated with not paying your 'fair' share, we have a new set of definitions, whereby there is such a thing as 'unlawful Tax Avoidance'. This is deliberately vague and designed to punish any citizen who does not buy into the great socialist experiment. With the various tax rules now in place in the UK, there is practically no advantage whatsoever to having a trust or foundation. What benefits there are are negligible. There have been a raft of landmark cases whereby English courts have essentially gone 'fishing' and forced foreign jurisdictions to disclose details about trust holders, particularly in the case of divorce. If you have a trust in a Crown dependency, you may as well not have bothered, given the expense of creating and running a trust.

The greatest, and increasingly only, means of obtaining protection from a trust is to keep it secret from anyone you may at any point wish to deny its existence to. Trusts and foundations can still be wonderful vehicles, providing the initial capital is a secret to hostile parties.

[bacon]

In the US inheritance tax can be mitigated if you receive or give assets like stocks from/to loved ones. This also sets up a favorable cost basis where in you only have to pay the capital gains from the time the assets where given to you(when loved one passed away) as opposed to the original purchase price.

In terms of standard asset protection its a good idea especially if you live in a lawsuit happy country like the United States to get an umbrella insurance policy of at least a million dollars.

If you have sizable assets/business setting up an LLC is another way to help protect your from assets from lawsuits as well and likely would make it harder for your potential ex wife to get a hold of them in the event of a divorce especially if you had a prenuptial agreement.

[jj90]

I have researched this and have basically concluded that while it is possible to segregate your assets fairly effectively globally, there will be an endpoint where if shit gets real enough either you, your assets or both will have to leave your home jurisdiction.

Take a foreign trust friendly jurisdiction where the trust beneficiary is self settled or even better another entity in another offshore assets friendly jurisdiction. Unless you commit a crime in your home country AND that same crime is recognized and proven in the offshore jurisdiction it will be almost impossible AFAIK to touch your assets. Civil matters unless it is a very large sum of money will likely not be pursued because the cost and due process is prohibitive.

Do realize there is a serious distinction between ex ante and ex post. Ex post transactions can be reversed in the light of a crime, but ex ante will be much harder but not impossible to reverse. Since most people here aren't criminals, and likely to not be, most matters will be civil and an ex ante transaction is virtually irreversible.

Last note, and maybe most important, your home country has no jurisdiction overseas unless they choose to pursue you for serious (read criminal) issues, so if your hand gets forced, it's time to book a 1 way ticket out. If you and your assets are offshore, and your not on Interpol's most wanted list, whatever judgements passed locally at home obviously do not get enforced with caveats.

I suspect most people reading this thread thinking about this course of action will have to decide as to when is the correct time to initiate such actions as it is a fairly significant decision based on one's current life and business situation.

My 2 cents. Good luck to all.

[SunW]

(11-15-2015 06:38 PM)H1N1 Wrote:  

I specialised in trusts and asset protection, and am a serious Trust law nerd. The government here in the UK has a perpetual social justice crusade to close every single legal loophole they can - including introducing an obligation on all those who provide these services to report new tax avoidance schemes to them for examination of their legality. It used to be the case that Tax Evasion was illegal, and Tax Avoidance was lawful, and those terms had distinct meanings with different legal effects. Now, given the stigma associated with not paying your 'fair' share, we have a new set of definitions, whereby there is such a thing as 'unlawful Tax Avoidance'. This is deliberately vague and designed to punish any citizen who does not buy into the great socialist experiment.
...
The greatest, and increasingly only, means of obtaining protection from a trust is to keep it secret from anyone you may at any point wish to deny its existence to. Trusts and foundations can still be wonderful vehicles, providing the initial capital is a secret to hostile parties.

I respect the honesty and I can't emphasize enough to all men that there won't be options in the long run. What's the unintended consequence of a country with too many lawyers? You are going to see what we're already seeing across society - a complete drop in small businesses, very few opportunities, and people fighting each other in courts like crazy, where no one wins in the long run. (See India). No lawyer will ever be any man's friend because none of them are working to de-regulate the system; that would mean less money for them, even if it improves our system. If anyone wants to see the effects of it, look at the growing shortage in medicine; because some medicine costs too much to produce some of these pills, companies simply stop producing them. Legal costs - for lawsuits - are a huge part of this. The result is that people don't get the medicine they need.

Ironically, that will also affect lawyers in the long run - they're burning their own bridges, but we live in a world where everyone must get-theirs-now, long term consequences be damned!

That's why my advice is you must consider systems that inherently don't (and can't) involve the law; if they don't understand it, don't know about it, or don't want to, you win. You must learn that the entire system is designed to ruin you - and if there's one loophole, they'll close it eventually. But they can't close what they don't know, and the problem is that most discussions aren't private. Also, most discussions might have one or two SJWs, who work against you - so who can you trust to keep what you know private?

Outside of that advice, the only solutions are:
- Stop voting for anyone with a law degree. They have no interest in making things better for you. They want more money through being able to sue you for anything; they despise you.
- Get involved in your local political system and stay active. You won't get better laws until you start caring about the future. Most idiots on this forum will just run off to another country, without considering the same will happen there too. You have to start giving a damn otherwise you've already lost.

[Running Turtles]

I appreciate all the replies to this. It's good to see different view points from different parts of the world too. RatInTheWoods, I had no idea about18 months of cohabitation gives anyone a right to your stuff in Australia. That sounds completely crazy and I'm not the least bit surprised that they can pierce trusts to get at your assets if the laws are that senseless.

I think jj90 touched most on what I originally meant though. The key here is not to establish a trust in your home country, but rather to found a Foundation in a country with stringent privacy laws that is outside your jurisdiction. Any legal adversary would not only have to prove that there is a foundation, but also that the foundation is controlled by you.

[H1N1]

(11-16-2015 07:47 AM)Running Turtles Wrote:  

I think jj90 touched most on what I originally meant though. The key here is not to establish a trust in your home country, but rather to found a Foundation in a country with stringent privacy laws that is outside your jurisdiction. Any legal adversary would not only have to prove that there is a foundation, but also that the foundation is controlled by you.

I think this is perhaps an oversimplification of the actual position. To establish a trust or foundation, there must be some initial founding capital. If the founding capital was created, taxed, or declared (one of which will be necessary if we are keeping with your requirement that everything be strictly legal) in your home country, there is already a paper trail. Is the money in your home country's bank account? With a bank that does billions of pounds worth of business every day in that country? If so, there is a record of the existence of the capital, and a 3rd party vulnerable to disclosing details about the capital. This is before you have even created the trust.

Once the property is transfered into a trust or foundation, there are all kinds of formal requirements, even in the most lenient jurisdictions. One of which, that applies to valid trusts and foundations if they are not to be labeled a 'sham' by the court, is that a valid trust cannot have the settlor, trustee, and beneficiary all be the same person. There must be a separation of interest. Although common law around discretionary trusts, and statutory instruments governing foundations, allows for certain powers to be exercised by the settlor (eg appointment of new trustees, beneficiaries, guidance on the distribution of capital) ultimate power for disposals must rest with the Trustee. In addition to this, you only have to make a minor slip up to have your trust ruled a sham. If you have trust accounts sent to your property, or your wife gets hold of an email between you and your trustee, etc etc. It is amazing how many trusts and foundations are undone due to basic admin expediencies on the part of a settlor.

Privacy laws may offer you some protection, but I would suggest far less than you may think. There are one or two countries, such as Switzerland, where the convention of non-disclosure to foreign authorities may be as water-tight as is suggested. However, one only has to look at how Liechtenstein folded under relatively modest pressure to see that most jurisdictions are extremely vulnerable, providing your host nation can tie you to the capital. If they can, they are in a strong position to apply pressure on that jurisdiction to reveal some information, which can then be used to force you to defend a position, in the process of which you are likely to give away information that can be further used against you. Equally, if your trust is in a foreign jurisdiction, but your trustee is in your home nation, a trusted friend perhaps, pressure can be brought to bear on him. If he has a family, a mortgage, a career etc, a forensic investigation of his financial affairs, an attempt to tie your capital to him as undisclosed taxable property, etc etc, could easily see him reveal further incriminating/position-weakening information.

SunW is right, lawyers are not on your side, however much they are paid (and trust lawyers can afford to be expensive). Like the rest of us, they have families, careers etc that they have to protect. The state apparatus can bring enormous pressure to bear on them, and no lawyer will risk being struck off simply to save you a few quid.

[WestIndianArchie]

Redacted

[Running Turtles]

Thanks for your answer WIA, that clears things up a lot. There seems to be a large industry devoted to asset protection, so I assumed it had real utility at some point. It makes sense though that most developed countries have this nailed down.

If the conclusion of this thread is that the whole idea is idiotic, then that's a fair enough result. I'm merely curious about the concept.

(11-16-2015 11:44 AM)WestIndianArchie Wrote:  

@Running Turtle

...

No judge is going to say that a good chunk of your income and wealth should not go to the health, education, and care for YOUR child. Doesn't really matter how much of a bitch she was, whether she cheated, or even in she spends all that child support on herself.

That's the environment we live in.

WIA

Just to be clear, that was never the point. In the OP, I was talking about protecting major assets like house(s), business(es), or possibly cars. Escaping responsibility for a child or even alimony was never intended or discussed.

[jj90]

(11-16-2015 09:33 AM)H1N1 Wrote:  

I think this is perhaps an oversimplification of the actual position. To establish a trust or foundation, there must be some initial founding capital. If the founding capital was created, taxed, or declared (one of which will be necessary if we are keeping with your requirement that everything be strictly legal) in your home country, there is already a paper trail. Is the money in your home country's bank account? With a bank that does billions of pounds worth of business every day in that country? If so, there is a record of the existence of the capital, and a 3rd party vulnerable to disclosing details about the capital. This is before you have even created the trust.

Once the property is transfered into a trust or foundation, there are all kinds of formal requirements, even in the most lenient jurisdictions. One of which, that applies to valid trusts and foundations if they are not to be labeled a 'sham' by the court, is that a valid trust cannot have the settlor, trustee, and beneficiary all be the same person. There must be a separation of interest. Although common law around discretionary trusts, and statutory instruments governing foundations, allows for certain powers to be exercised by the settlor (eg appointment of new trustees, beneficiaries, guidance on the distribution of capital) ultimate power for disposals must rest with the Trustee. In addition to this, you only have to make a minor slip up to have your trust ruled a sham. If you have trust accounts sent to your property, or your wife gets hold of an email between you and your trustee, etc etc. It is amazing how many trusts and foundations are undone due to basic admin expediencies on the part of a settlor.

Privacy laws may offer you some protection, but I would suggest far less than you may think. There are one or two countries, such as Switzerland, where the convention of non-disclosure to foreign authorities may be as water-tight as is suggested. However, one only has to look at how Liechtenstein folded under relatively modest pressure to see that most jurisdictions are extremely vulnerable, providing your host nation can tie you to the capital. If they can, they are in a strong position to apply pressure on that jurisdiction to reveal some information, which can then be used to force you to defend a position, in the process of which you are likely to give away information that can be further used against you. Equally, if your trust is in a foreign jurisdiction, but your trustee is in your home nation, a trusted friend perhaps, pressure can be brought to bear on him. If he has a family, a mortgage, a career etc, a forensic investigation of his financial affairs, an attempt to tie your capital to him as undisclosed taxable property, etc etc, could easily see him reveal further incriminating/position-weakening information.

SunW is right, lawyers are not on your side, however much they are paid (and trust lawyers can afford to be expensive). Like the rest of us, they have families, careers etc that they have to protect. The state apparatus can bring enormous pressure to bear on them, and no lawyer will risk being struck off simply to save you a few quid.

I would like to get your opinion based on your experience as to if an individual were to:

1)transfer assets to a foreign bank that does no business in your home country.
2)A trust in the foreign country that does recognize self settling or some derivative thereof.
3)With a trustee that is not in your home country.

What sort of asset liability does that individual carry offshore and what sorts of enforcement can that individual's home country apply to the foreign country?

[jj90]

(11-16-2015 11:44 AM)WestIndianArchie Wrote:  

@Running Turtle

If I represent the wife, she'll tell me about the household finances. I will know where you work, where you bank, what kind of car you drive, and where you live. I'll know your hobbies.

The judge will give me your tax records.

I can also make a motion to get your personal and business accounts.

I will hire a forensic accountant.
He will find outflows of cash that do not match your lifestyle.

Then i will go to the judge and he will compel you to disclose all of your assets and account for these monies, or you will be found in contempt. He may put you in jail, that's in the judge's discretion.

Your lawyer will not risk his license to commit fraud on the court. No lawyer will.

Everything that I'm talking about is routine. There are textbooks and entire practice areas devoted to uncovering hidden assets. Industries have been built to do this.

WIA, given the motions and due process you have outlined above, given an individual is not in the country, how does enforcement if any apply? I think you outlined it in the 2nd half of your post but for clarity's sake would like for you to expound.

[WestIndianArchie]

I'm not sure if i know what you're asking.

Military guys living abroad get divorced all the time.

http://www.dmcfamilylaw.com/blog/2014/06...yment.aspx

If It's a civilian, they can't just stay out of the country to avoid service and protect their American assets. A court may decide the matter in absentia, which happens on other kinds of cases.

WIA

[H1N1]

(11-16-2015 01:01 PM)jj90 Wrote:  

(11-16-2015 09:33 AM)H1N1 Wrote:  

I think this is perhaps an oversimplification of the actual position. To establish a trust or foundation, there must be some initial founding capital. If the founding capital was created, taxed, or declared (one of which will be necessary if we are keeping with your requirement that everything be strictly legal) in your home country, there is already a paper trail. Is the money in your home country's bank account? With a bank that does billions of pounds worth of business every day in that country? If so, there is a record of the existence of the capital, and a 3rd party vulnerable to disclosing details about the capital. This is before you have even created the trust.

Once the property is transfered into a trust or foundation, there are all kinds of formal requirements, even in the most lenient jurisdictions. One of which, that applies to valid trusts and foundations if they are not to be labeled a 'sham' by the court, is that a valid trust cannot have the settlor, trustee, and beneficiary all be the same person. There must be a separation of interest. Although common law around discretionary trusts, and statutory instruments governing foundations, allows for certain powers to be exercised by the settlor (eg appointment of new trustees, beneficiaries, guidance on the distribution of capital) ultimate power for disposals must rest with the Trustee. In addition to this, you only have to make a minor slip up to have your trust ruled a sham. If you have trust accounts sent to your property, or your wife gets hold of an email between you and your trustee, etc etc. It is amazing how many trusts and foundations are undone due to basic admin expediencies on the part of a settlor.

Privacy laws may offer you some protection, but I would suggest far less than you may think. There are one or two countries, such as Switzerland, where the convention of non-disclosure to foreign authorities may be as water-tight as is suggested. However, one only has to look at how Liechtenstein folded under relatively modest pressure to see that most jurisdictions are extremely vulnerable, providing your host nation can tie you to the capital. If they can, they are in a strong position to apply pressure on that jurisdiction to reveal some information, which can then be used to force you to defend a position, in the process of which you are likely to give away information that can be further used against you. Equally, if your trust is in a foreign jurisdiction, but your trustee is in your home nation, a trusted friend perhaps, pressure can be brought to bear on him. If he has a family, a mortgage, a career etc, a forensic investigation of his financial affairs, an attempt to tie your capital to him as undisclosed taxable property, etc etc, could easily see him reveal further incriminating/position-weakening information.

SunW is right, lawyers are not on your side, however much they are paid (and trust lawyers can afford to be expensive). Like the rest of us, they have families, careers etc that they have to protect. The state apparatus can bring enormous pressure to bear on them, and no lawyer will risk being struck off simply to save you a few quid.

I would like to get your opinion based on your experience as to if an individual were to:

1)transfer assets to a foreign bank that does no business in your home country.
2)A trust in the foreign country that does recognize self settling or some derivative thereof.
3)With a trustee that is not in your home country.

What sort of asset liability does that individual carry offshore and what sorts of enforcement can that individual's home country apply to the foreign country?

Trust law is an extremely complex area of law, arguably the most complex, and has given rise to some of the most subtle legal and equitable principles in the common law. So, whilst I'll attempt to answer your questions, being very general and not actually related to specific issues of founding, protecting, or maintaining trusts, I fear the answers won't actually be terribly enlightening.

1. Transferring taxed assets to a foreign bank account in itself is no big deal. Of course, with all of these things, the question is always who are you trying to hide what from? The actual act of transferring money abroad is obviously not suspicious. If the govt has had all the many and varied slices it has created an entitlement to, and there is no dispute, then there is no de facto interest in the fact that you have done it. If it is your money, free from legal or equitable burden, how you dispose of it is your own business.

The very act of transferring value though creates a record of the transactions, that a court would under certain circumstances be quite prepared to unravel - see for example the principle of 'tracing' in trust law, whereby misappropriated value from a trust can be followed by the court, through various incarnations, to ensure the beneficiary's equitable interest is protected.

2. Again, simply creating a trust in another country is a fairly uncontroversial concept. What matters as far as asset protection is concerned is: what is the value, how is it stored, who knows about it, who has claims on it? If the assets you wish to place in trust are based in your home nation, and you live in the 1st world, the Govt, or if you are married your spouse, most likely knows about them.

There are no jurisdictions that allow for what I think you are talking about. No jurisdiction will allow you to settle property, on trust for yourself, with you as the trustee. The only instance in which such a thing is desirable is when you are using the trust instrument for illegal purposes (tax evasion, money laundering, etc). Of course, this is where a trust is most useful, and there are ways in practice where you could set up just such an arrangement - but it would be illegal, would be an abuse of that country's law, and if discovered you would receive no protection.

3. Where the trustee is doesn't matter that much except for how the court interprets the jurisdiction of the trust (so potentially it matters tremendously). If for example you claimed to be the beneficiary of a Cayman Island trust, that you had settled for yourself, and appointed your best man as trustee, and the property itself (a house for example) were located in your host nation, and the trustee were located in your host nation, and all your trust meetings took place in your local pub, the court might well decide that it is not a Cayman Island trust at all.

[Brodiaga]

It's understood that once you have decided to marry and have children, you have to be prepared to pay for it if things go wrong.

Let's say you don't get married, don't move in together with a girl and are very serious about protection (from having kids), so the risk of getting screwed by the divorce/child support parasites is very low.

However, there are still risks of getting sued or losing your money some other way.

My question is this (actually, two questions):

-If you live in the US, how much net worth do you need to have to start considering using a foreign trust or other offshore asset protection schemes? Not an exact amount, but at least approximate. 100K? 1M? 10M? More?

-Same question, but if you are a US person and live overseas. For example, you bounce between Eastern Europe and SEA and run your online business. At what point (of income and/or net worth) does it make sense to set up offshore trusts or engage in other asset protection schemes in this case?

[jj90]

(11-16-2015 04:03 PM)WestIndianArchie Wrote:  

I'm not sure if i know what you're asking.

Military guys living abroad get divorced all the time.

http://www.dmcfamilylaw.com/blog/2014/06...yment.aspx

If It's a civilian, they can't just stay out of the country to avoid service and protect their American assets. A court may decide the matter in absentia, which happens on other kinds of cases.

WIA

Let's use an American citizen since that is what you are familiar with. Say this US person does a transfer of assets to an offshore trust before an event say divorce for example, since after the fact it is quite meaningless if we are looking at keeping things above water.

This same person has no RE assets or anything worthwhile in the US, and whatever this person has legal title to is essentially not worth defending(eg. a bank account with few $hundreds). If a judgement is passed against this individual AND the individual is domestic, then I understand the full force of the courts/govt is brought upon said person.

If the person is not in the US and does not plan to return, given a judgement passed in absentia, based on your experience what liabilities should this person be aware of?

To phrase it a different way, if a person is judgment proof, how far based on your experience will these matters go, IF the creditors are civil and not criminal(don't believe divorce is a criminal issue in the US)?

Hope this is more concise, thanks in advance.

[jj90]

(11-16-2015 04:26 PM)H1N1 Wrote:  

3. Where the trustee is doesn't matter that much except for how the court interprets the jurisdiction of the trust (so potentially it matters tremendously). If for example you claimed to be the beneficiary of a Cayman Island trust, that you had settled for yourself, and appointed your best man as trustee, and the property itself (a house for example) were located in your host nation, and the trustee were located in your host nation, and all your trust meetings took place in your local pub, the court might well decide that it is not a Cayman Island trust at all.

H1, let's use an example of a UK citizen since you are best familiar with that. I take it you mean the host country court in this case the UK, and duly noted on all previous points including the above.

So the hypothetical is using the example above:
1)say the property is an RE asset located in say, Brazil.
2)The trust is in Brazil.
3)The trustee is in Brazil.
4)All trust related meetings/issues were not in the UK.

If a UK court wanted to dig up info and overturn the transaction or rule the trust a sham, what enforcement powers would they have in the foreign country in this case Brazil? What would be the due process the UK court would go thru?

For clarity's sake, this particular UK citizen has basically expat'ed himself and holds no ties to the UK. And please note Brazil was just an example, it could be any country that is not the UK.

[Rush87]

(11-15-2015 03:39 PM)RatInTheWoods Wrote:  

(11-15-2015 07:56 AM)Running Turtles Wrote:  

Some members of this forum have substantial legal knowledge in various areas around the world. I would like to hear your input on this if possible. I have an EU flag, but the North Americans and those living on other continents shouldn't feel unwelcome to the thread. I'm using the USD as a currency because it's well understood by everyone and it's very close in value to the Euro at the moment. While solutions may have to be slightly different in some parts of the world, the topic of discussion is a global one.

In Australia, the "family court" has extra ordinary powers to award all your assets to breast owners.

They can pierce trusts, overturn prenups, make up evidence, ignore facts and make rulings "without the burden of proof" (yes I have seen and been a victim of the legislation).

Basically you can take some measures to make it difficult, or delay. But at the end of the day there is a huge industry set up to strip funds of men and redistribute to lawyers and breast owners, and they are not going to let men opt of of the system with so much easy money at stake.

Any time someone comes up with something, they legislate around it.

I dont know about other countries, but this is my first hand direct experience with the Australian system.

If you are not prepared to loose everything, don't marry or co-habituate with a woman. 18 months co-habitation means you have the same legal status as married by Australian laws.

This needs to be stickied for any Australians. I highly doubt many realise that a defacto relationship is virtually no different to marriage and you will lose half your shit for anything over two years.

This is why the whole equal rights for gays [In Australia] is a complete pile of bullshit. They are protected in the very same way as married couples if a defacto relationship breaks down. In other words gays were just as fucked as straight people when it comes to marriage.

From personal experience I have had a woman attempt to clean me out years ago in my early 20's long before I was even aware of red pill anything. I had a 20 month live in relationship and was lucky enough that my assets were tied up in my parents name [Which in hindsight may have been my fathers doing. He works with defacto claims in a family law firm. He told me it was a smart taxation decision. I've never asked him but in all likelihood he was saving my bacon in advance].

[monster]

(11-16-2015 07:52 PM)Brodiaga Wrote:  

-If you live in the US, how much net worth do you need to have to start considering using a foreign trust or other offshore asset protection schemes? Not an exact amount, but at least approximate. 100K? 1M? 10M? More?

-Same question, but if you are a US person and live overseas. For example, you bounce between Eastern Europe and SEA and run your online business. At what point (of income and/or net worth) does it make sense to set up offshore trusts or engage in other asset protection schemes in this case?

I think this depends on the person. I think that if you take a look at your assets and say to yourself, wow, I worked really really hard for all this and if someone sued me now they could really do some damage and erase years of hard work then you probably have enough to look into LLCs, trusts, etc.

I think if you're asking though "Do I have enough to look at asset protection strategies" you probably don't have enough to warrant getting too hung up on asset protection yet because I think you'll know in your gut when you have enough that other people want a piece of it.

[Brodiaga]

(11-16-2015 11:39 PM)monster Wrote:  

I think this depends on the person. I think that if you take a look at your assets and say to yourself, wow, I worked really really hard for all this and if someone sued me now they could really do some damage and erase years of hard work then you probably have enough to look into LLCs, trusts, etc.

I think if you're asking though "Do I have enough to look at asset protection strategies" you probably don't have enough to warrant getting too hung up on asset protection yet because I think you'll know in your gut when you have enough that other people want a piece of it.

This is where I have to disagree. Making financial and legal decisions with your gut is what poor people do.

I understand there isn't an exact cut-off point, but it's pretty obvious that a person who makes minimum wage shouldn't be looking into offshore accounts. Same thing for an English teacher who makes $1000/month in Asia (could be different for an English teacher who has another business or source of income on the side).

I'm just looking for guidelines. For example, "don't even bother with offshore accounts unless you have $X+ of net worth". Maybe there are no simple guidelines which is fine.

[H1N1]

(11-16-2015 07:52 PM)Brodiaga Wrote:  

It's understood that once you have decided to marry and have children, you have to be prepared to pay for it if things go wrong.

Let's say you don't get married, don't move in together with a girl and are very serious about protection (from having kids), so the risk of getting screwed by the divorce/child support parasites is very low.

However, there are still risks of getting sued or losing your money some other way.

My question is this (actually, two questions):

-If you live in the US, how much net worth do you need to have to start considering using a foreign trust or other offshore asset protection schemes? Not an exact amount, but at least approximate. 100K? 1M? 10M? More?

-Same question, but if you are a US person and live overseas. For example, you bounce between Eastern Europe and SEA and run your online business. At what point (of income and/or net worth) does it make sense to set up offshore trusts or engage in other asset protection schemes in this case?

Obviously the answer to this will be slightly subjective. Trusts and foundations can be expensive to run. They impose a great deal of liability on the trustee (trustees can be personally liable, liable even after they have been removed as trustee, etc etc), and professional trustees want to be well remunerated accordingly. If you are a rich bloke with taxed assets that you are trying to protect to continue a dynasty, you are likely to want to use a professional trustee. If there is sizable capital to invest, the trustee has a duty to ensure that the trust property is well invested. If the trustee is not an investment professional, he is likely to want to employ one, etc etc. Costs for a substantial trust could easily run into 6 figures each year. Basically as the amount of capital increases, so do the costs associated with maintaining and increasing it.

However, if you appoint a friend as your trustee, and it is over a particular property, or something like that, then there may not be any costs associated with that for 20 years. Your friend may simply agree to hold a property in trust for your children free of charge, and see to it that legal title is assigned to them when they reach the age of maturity.

What a trust costs depends on what you're putting into it, where you base it, what you expect out of it, and how well and from whom you are trying to protect it. Trusts and foundations are very case specific instruments, and don't really allow you to appreciate their phenomenal advantages unless you are looking at specific problems, or potential problems, that you are trying to avoid.

[H1N1]

(11-16-2015 11:14 PM)jj90 Wrote:  

(11-16-2015 04:26 PM)H1N1 Wrote:  

3. Where the trustee is doesn't matter that much except for how the court interprets the jurisdiction of the trust (so potentially it matters tremendously). If for example you claimed to be the beneficiary of a Cayman Island trust, that you had settled for yourself, and appointed your best man as trustee, and the property itself (a house for example) were located in your host nation, and the trustee were located in your host nation, and all your trust meetings took place in your local pub, the court might well decide that it is not a Cayman Island trust at all.

H1, let's use an example of a UK citizen since you are best familiar with that. I take it you mean the host country court in this case the UK, and duly noted on all previous points including the above.

So the hypothetical is using the example above:
1)say the property is an RE asset located in say, Brazil.
2)The trust is in Brazil.
3)The trustee is in Brazil.
4)All trust related meetings/issues were not in the UK.

If a UK court wanted to dig up info and overturn the transaction or rule the trust a sham, what enforcement powers would they have in the foreign country in this case Brazil? What would be the due process the UK court would go thru?

For clarity's sake, this particular UK citizen has basically expat'ed himself and holds no ties to the UK. And please note Brazil was just an example, it could be any country that is not the UK.

I'm afraid I'm struggling to find a specific enough question to give you a meaningful answer.

From 1-4, assuming the trust was not in Brazil (doesn't have trust legislation and is not a common law country) and was in the BVI or something like that instead, there is no prima facie problem - providing there is no competing claim on the value.

The point with a trust is that its existence may not be known to any outside parties. For a court to rule it a sham, or to attempt to force disclosure, they have to know about it. So to give you a meaningful answer I'd have to come back to you with a bunch of questions - why is the court investigating, what is the original source of the capital, who is staking a claim to it, where specifically is it domiciled (for example, BVI as a crown dependancy is more likely to roll over than Panama, who has no ties to the UK), how much about the existence of the capital and its subsequent disposal is known to the court, etc etc?

I know it seems like I am being very obtuse, but your questions are at too great-a-level of abstraction for me to give you a meaningful response.

[WestIndianArchie]

@H1

You can always just leave the country. Go to a place with no agreements.

https://lawdiva.wordpress.com/2012/12/17...y-nothing/

But it's very difficult to live in the developed world and hide your money from ex wives and other creditors.

[H1N1]

(11-17-2015 08:10 AM)WestIndianArchie Wrote:  

@H1

You can always just leave the country. Go to a place with no agreements.

https://lawdiva.wordpress.com/2012/12/17...y-nothing/

But it's very difficult to live in the developed world and hide your money from ex wives and other creditors.

Indeed. I couldn't agree more. In light of the increasing squeeze on the productive by the developed nations, I have increasingly been considering just such a move, loathe as I always thought I'd been to abandon my own country to her fate.