Puai Wichman On Asset Protection Through Offshore Trusts

In a world where protecting one's assets is increasingly important, offshore asset protection trusts have emerged as a popular option. Puai Wichman mentions these trusts offer a way to place assets beyond the reach of creditors and can be an effective tool for safeguarding one's wealth. However, they must be carefully established and managed to avoid conflicts with the Internal Revenue Service. Before new trust legislation in Delaware and Alaska, offshore asset protection trusts were the only viable option for creating a self-settled spendthrift trust. By properly utilizing an offshore asset protection trust, individuals can have peace of mind knowing that their assets are secure and protected.

Offshore jurisdictions are becoming increasingly popular for self-settled asset protection trusts, with some of the most well-known locations including Nevis, St. Kitts, the Cook Islands, and the Bahamas. These areas have long recognized the validity of these trusts and the importance of keeping assets out of reach from predators. Like their domestic counterparts, offshore trusts must be irrevocable, have an independent trustee, and provide only for distributions subject to the trustee's discretion. Additionally, they must have a spendthrift clause. However, offshore asset protection trusts offer some significant advantages over domestic trusts, such as greater privacy and the ability to protect assets from creditors in other countries. Anyone seeking to protect their valuable assets would consider one of these offshore jurisdictions an attractive option for their self-settled asset protection trust.

The concept of an offshore asset protection trust may be confusing at first glance, but it boils down to one key element: sovereign nations are not bound by the laws of foreign governments. Puai Wichman explains that an offshore jurisdiction is immune from U.S. laws and regulations. Even if the trustor/beneficiary is a resident of a U.S. state, they cannot force the offshore trustee to make a distribution, as all distributions are made at the trustee's discretion. While U.S. courts may try to intervene and order a distribution, the trustor/beneficiary can use the "impossibility" defense, citing certain clauses within the trust. In the past, this defense has proven to be successful. Ultimately, the offshore asset protection trust offers a legal means for those seeking to protect their assets and wealth from the reach of U.S. laws and regulations.

The burden of proof required to convict someone of a crime is incredibly high in the United States. It must be proven "beyond a reasonable doubt" that the accused committed the crime. This standard is one of the strictest in the world, and it serves as a reminder that we must be certain of guilt before we punish someone. However, when it comes to a creditor challenging an asset transfer, the standard is much lower. For a creditor to win in a civil case, it is only necessary to prove their allegation by a "preponderance of the evidence" – meaning that it is more likely than not that the allegations are true. This standard disparity is a reminder that the U.S. legal system takes a nuanced approach to each case, weighing the evidence accordingly.

Justice is a delicate balance between protecting the innocent and holding the guilty accountable. It's a difficult task and one that often comes at a cost. In the case of offshore trusts, a high standard is required to protect the rights and liberties of innocent persons. However, this standard can also make it challenging to hold guilty parties responsible. In the context of a Nevis offshore trust case, this legal protection is incredibly beneficial for those who have nothing to hide. It might make it challenging for creditors to pursue claims, but it safeguards innocent individuals. Puai Wichman says foreign jurisdictions also do not require any assets of the trust to be located there, which further strengthens the protection of its beneficiaries.

Puai Wichman is the founder and CEO of Ora Partners, an international trust provider and wealth management firm dedicated to helping families and individuals protect personal and corporate wealth.