Asset Protection Strategies/Alternatives

A front page article by Liz Hoffman in Monday’s Wall Street Journal noted that some companies are convinced Delaware is less of a corporate haven than it used to be.  Some companies feel the state has become less hospitable toward business (for example, by not doing enough to curb ever-growing shareholder litigation).  Nevertheless, Delaware remains

Articles that seemingly have nothing to do with asset protection might still provide valuable asset protection reminders.  A recent article by Teresa Dixon Murray in the Cleveland Plain Dealer is a good example.  The article discusses an individual who keeps more than $100,000 hidden at home! 

That reminds me of at least two asset protection

Some states offer better asset protection alternatives than others.  There are numerous factors to consider in deciding how good (or bad) a state is from an asset protection standpoint.  These factors include:

Whether or not the state has a Domestic Asset Protection Trust Statute

Provisions of the state’s LLC statute

The state’s homestead exemption and

Courts in a number of states have specifically held that lawyers can violate applicable disciplinary rules by facilitating fraudulent conveyances.  This can result in an attorney being suspended or even disbarred. 

This is one of the reasons that an attorney must conduct a certain amount of due diligence about a new client before agreeing to

Asset protection requires expertise in many different areas of law.  One key area is litigation, since the ultimate test of any asset protection plan is how well it will hold up in court.  Asset protection attorneys must also have expertise in business entities (particularly limited liability companies); trusts; and estate planning (since asset protection planning

A recent article in the New York Times by John F. Wasik provides an excellent discussion of trust protectors.  Many states now allow for trust protectors – – someone other than the trustee who essentially provides some checks and balances in a trust arrangement.

A trust protector is a bit like a watchdog.  He or

Many foreign jurisdictions provide opportunities for offshore trusts.  But if you are seriously considering such a trust, the Cook Islands deserve your attention.

Asset protection lawyers frequently debate the pros and cons, risks and possible rewards of offshore versus domestic asset protection trusts.  And there are lots of potential asset protection strategies that do not