I found a cheap alternative. It is an offshore debit card. There is no name required and you can even give false info when you register your card online card. Its at www.atmgcard.com . Looks like something that I can afford and it’s anonymous.
If you place your funds in an offshore trust, such as with the Cook Islands, you will have the strongest protection from potential future lawsuits.
Offshore accounts are perfectly legal and a very smart move if you do them before a lawsuit occurs. If you use an offshore account after you have been sued or a government agency is coming after you in order to hide the money or defraud creditors, then this is illegal and will backfire on you.
The trick is do it before you have any problems and your money will be protected in case of a future lawsuit (say a car accident or a trip and fall). This will also give you the privacy you require.
Plaintiff’s attorneys sue first and then conduct a search. It too quick, easy and cheap to do otherwise. They know the questions to ask during discovery to uncover hidden asset, but you can always lie and then pray their investigators don’t catch you. These accounts must be declared to the IRS and nothing prevents an judge from ordering you to authorize the IRS to release the information.
Here’s a new tactic in use: sue the planner for civil fraud along with the debtor. The planners crumble under the threat of a suit and become a witness against the debtor.
That is an interesting article. Here’s two stories that went the other way. The trustee for Lawrence refused the order. He spent 6 years in prison. The trustee for Merry Morris also refused and she stayed in custody until she reached a settlement. Judges don’t believe the debtor cannot repatriate the assets and have never failed to issue one since the Anderson case.
BLL, those are some hard core instances you are referring to and some excellent references too. I would hate to be in those situations.
But won’t the IRS very likely refuse the judges request to provide this information? Especially for a typical civil suit. I am not referring to a large case where the person is trying to defraud the government for example.
Which country was the trustee in that you are referring to? I know a judge can say and do anything, but the question is will he and will it be legal and overturned if it’s not legal.
I think for the typical person who is being sued for something related to his/her real estate situation like someone who is looking for a fast and easy lawsuit to take advantage of a situation, an offshore trust will likely protect the person from the typical lawyer and lawsuit (it would be too costly and difficult to do otherwise). Going after the Cook Islands setup would be an extremely difficult and expensive procedure for most situations.
I could understand for a large hardcore lawsuit under much more profitable situations and a very large and powerful lawfirm with deap pockets considering the case, but for the typical cases, it would be a lot of trouble and expenses. :shocked
I’m not talking about tax evasion either. The cases I mentioned were civil. One was a divorce. The other was a dispute over a margin call. It all came down to the fact that the judges in each case didn’t believe the debtors had no access to the funds.
As to the IRS, the judge orders the defendant to sign a release for the tax documents. The IRS won’t refuse to release the information because it has the taxpayer’s authorization. The defendant can refuse to sign, but then he goes to jail for contempt.
The country doesn’t matter since a judge has zero authority outside his jurisdiction, but he has control over the defendant’s liberty and throws him in jail if he doesn’t instruct the trustee to return the assets. If the trustee refuses, which they all do per their country’s laws, the debtor goes to jail because the judge doesn’t believe the trustee. It’s a lose-lose situation.
You are correct that it is expensive and time consuming to fight the set up. However, that’s not the point. If the judge believes you can repatriate assets, you go to jail if you don’t, even if you can’t. That is the leverage of the creditor. You either settle on his terms or go to jail.
We are talking hardcore lawsuits when we talk offshore. These things have significant set up costs as well as on-going maintenance costs. Investigation is cheap and there is already precedent to show how easy it is to force a debtor to settle on the creditor’s terms.
My opinion is that offshore should only be used when there is actual offshore business. For example, an import/export company. That being said, there is an opportunity in foreign currency and stock markets as well as insurance products that could justify offshore entities for an American with no international business. The only real problem I see is that Congress is starting to impose more and more regulations on international activity and imposing stiff penalties for even minor non-compliance.
BLL, thanks for the reply. I have not seen any of these siutations arise with any of our clients, but you seem to have a different perspective and insight, so your warnings are good to watch out for. I am not the asset protection guru, but I work for one that knows this stuff inside and out. He also does national seminar tours as well. So I am looking for real estate investment clubs for him to guest speak with.
I think it would be fun to put you two in a room and listen to the back and forth - it would be a good learning experience. :shocked