Let me start by saying, "I am not ultra rich so don't sue me." You can't get much out from me but I have enough. I've been thinking of putting up a business somewhere in Bahamas or Panama. I love the beach and when I retire soon, I want to enjoy the fruits of my labor in the place where I always wanted to stay during vacation. The sun, the beach, the scenery and the ladies, these are the things that I always look forward.
I didn't realize that my plan in establishing a resort in these places actually protects my assets from being snatched away by creditors. Oh well, I don't have tons of debts so it wouldn't be a problem but it's still good to know that offshore trusts can offer protection to assets.
How offshore trust can protect assets?
The use of offshore trusts to protect assets is common to people who have large estates because it can give high degree of asset protection and privacy. The most common places for offshore trusts include Panama, Bermuda, Bahamas, Gibraltar and the Cayman Islands. When you put up an offshore trust you are actually transferring the ownership of your assets to the foreign trust. There are foreign trustees who manage the trust from an offshore jurisdiction.
In the event when you are being sued and the creditor starts to look into your assets and founds out the offshore trust, they will have to deal with the trustees in order to hold the assets owned by the trust. In order for them to file a case against the trust, they will have to file it to a court in the jurisdiction where the trust was formed. Most often, courts from other countries don't have any jurisdiction over a trust set up in a different jurisdiction.
The best strategy to get a full protection on assets is to set up group of entities grouped together and spread to several jurisdiction. If dealing with a single jurisdiction is already a problem, how much more if they have to deal with several jurisdictions?
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