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Trial Lawyers in America

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ASSET PROTECTION & DOWN UNDER

With events unfolding in the U.S., if you don't see a need to protect assets, you'll probably never be convinced. Now, more than ever before, you should take asset protection seriously. The risks today threatening your assets are far greater than ever before.  

Today's newsletter provides thoughts and opportunities to protect your assets, if you take steps before it's too late. They apply whether viewing events from Down Under, or from at home. Read on to see why.

Why Asset Protection is Needed Now

America and Australia have much in common. The U.S. in 1776 (then the United Colonies) was forged on raw land by the spirit of freedom and independence. Australia was named in 1788 New South Wales by the British and was forged on the backs of prisoners which created a spirit of freedom and independence. 

Today the two nations are important, global Allies, cross-investing partners, and very good mates. Like America, Australia is experiencing global challenges from a new China global order well underway. And Aussies are watching closely what transpires with the Yanks. Today, both have needs for asset protection, for similar and different reasons.  

Asset Protection is generally implemented to help protect assets after challenging times arrive. But smart, forward thinking individuals take steps well in advance of confronting problems. The current environment - particularly in America - presents extraordinary challenges at many levels for protecting assets.

The good news is that there are steps you can take to protect a lifetime of savings and investments. 

One notable example of how asset protection saved fortunes was before the onset of the Second World War. Individuals across Europe with financial assets started taking early steps, before the uprising of changing continental and global politics. Asset protection began with quiet efforts to hide conspicuous assets from thieves and thugs. It grew to a greater need to protect life savings. At that time, Swiss accounts were the go-to solution due to assured privacy. 

These early steps made it difficult, and even impossible, for others to trace assets and force individuals to transfers their assets under threats of harm. At that time, strict Swiss laws had made it illegal to disclose assets, or account holders, to anyone, under any condition. Some Swiss depositors across the continent lost their lives. But those - or their heirs - that took early precautions came out far better after the war ended.

The need for asset protection became readily apparent by the late 1980s as U.S. litigation started to escalate. The Swiss bank secrecy laws and asset protection trusts across national boundaries during the 1930s and 1940s became the model for U.S. asset protection in the 1990s. And today, recent politics and social problems have increased the need.

Enter yours truly.

During the 1980s, my law practice focused primarily on civil litigation. I witnessed firsthand courtroom dramas unfold and how easy it was to separate individuals from their wealth. For many litigation lawyers, like myself, the courtroom was a sporting event. No tree was too big to fell.  The Art of War, written in 5th century BC by Sun Tzu, were our guiding principles. As a successful litigator, the American Trial Lawyers Association named me a Top 100 Trial Lawyer, and I also became an exclusive member of the Million Dollar Advocates Forum. 

But underneath the tough veneer, I was genuinely troubled by the shifting trend of going after someone else's hard earned life savings through ligation. After years as a trial lawyer I started to listen to my conscience.

As a result, I made a abrupt change and became an early legal pioneer in asset protection beginning in 1990. At the time, there were only three or four of us across the U.S. involved in this new, developing legal field. 

Beginning in the early 1990s, I started writing extensively on the topic of asset protection through hundreds of articles and newsletters, and published four asset protection and international law planning books. As an adjunct international law professor, I taught law students and other lawyers how international asset protection planning works. Many of those past articles are still available at this link. As time went on, I was credited for restructuring foreign asset protection trusts (FAPT) to what is today recognized as the more user-friendly, family asset protection International Trust, and the Standby International Trust.

What’s clear is that in times of uncertainty and risk, asset protection has helped protect investors, business owners, spouses, medical professionals, the elderly and the young, widows and heirs, and a long list of others with assets worth protecting. Whether the amount is $500,000, $5,000,000, or much more, a lifetime of hard-earned accumulated savings and investments means pretty much the same to everyone at all asset levels.

Since the early 1990s, I've implemented asset protection in the US, and globally, integrating estate planning and asset protection for a long list of individuals across a wide range and types of assets. The International Trust – planning across borders - is today considered superior to any other domestic planning. 

And since some individuals and their advisors 'fear the foreign', the Standby International Trust was created to keep everything local, while keeping cost down, and paperwork user-friendly. Find out more here.

What does history tell us about risks to assets today?

There is a long list of threats to assets. Changing political and social structures, systemic problems at home, government confiscation, one-off heavy taxation, frivolous lawsuits, business and professional failures, claims made by disgruntled employees or unhappy customers or patients, and the list goes on. 

Taking a long view of history, global pandemics and global wars, occur somewhat irregularly, but impact much larger numbers than most people realize. Localized epidemics and regional wars we’ve experienced were routine smaller events compared to the long story of history. But as Covid -19 demonstrates, global catastrophic pandemics and global wars occur at least once every century, and sometimes more often.

For years, I've been telling anyone that would listen that we were long overdue for the next global pandemic, and the next major war. In the past, I received dull responses. But sorry to say, only one of the two is left to occur. 

The common feature to all of these extreme events is that the risks to individuals with assets are greatly heightened during these times.

Why?

As is only now starting to manifest, jobs are lost, and many don't rematerialize. Businesses and professional offices close. Most individuals have limited savings and resources to fall back upon. Homes are lost. Large numbers of homeless are added to those already on the street. People become increasingly desperate. Desperate to feed their families. Desperate for a place to live. Desperate for basic medical care, and to pay their bills. 

Many quickly reach the bottom tier of Maslow’s hierarchy of needs. Their basic needs for food, clothing and shelter are simply not met.

If you or your family had no food or shelter, and needed food, medicine or warm clothing to survive, would you hesitate to forcibly take from others? In a world where everything looks bleak, this is when desperate people turn to desperate measures.

Throughout history, global pandemics and global wars result in desperate people turning to desperate measures. The current environment will be no exception. Social violence in America has already gotten worse. Many people and their tribes have already crossed the tipping point. More turbulence and violence is certain to follow.

The stories of the past hold true today about protecting assets during desperate times. Not just during pandemics and wars, but from so many other risks creating increasingly desperate individuals with little to lose.

Like we see today, events throughout history occur in stages. First a denial, then a tipping point is crossed. Many refuse to come to grip with the realities. But as conditions and events get worse over time, more and more individuals suffer hardships, and many will become increasingly desperate. Desperate people always turn to desperate measures, of all types.

This means more risks than cash-strapped governments taking from those that have, and to provide for desperate others that don't. It also means an increase in petty theft, armed robbery, and home break-ins. It means forcible transfers of assets under risk of harsh measures, by whatever it takes. Kidnappings for cash. And far worse. On line hackings are already spiking at all time highs. 

Read the history books. See the unimaginable extremes that desperate people take during extreme events.  

And there is only so much the government or police powers can do to stop or prevent some of the worst in human nature. Or that personal defense options can prevent. We saw that unfold in the U.S. Capital, and months earlier in Portland and elsewhere.

How far? How long? How bad? No one knows. But what we learn from history is that those that take steps early and prepare for the worst are the ones that best survive the ugly times that follow. And the others?

Baton down the hatches, and protect your assets! What is certain is that this is only the beginning, and much worse will follow. Terms of 'catastrophic' and 'unprecedented' don’t do justice to the future.

This is the Minsky moment.

Today, the wealth of the top 1% is equal to the lower 90% combined. The disparity in wealth today is far greater than leading up to the 1930s Great Depression. Today, governments are terrified with the economic fallout. Even before Covid-19, governments, economists, and reserve banks around the world were forecasting the end to the last forty-year debt super-cycle, with concerns of a greater recession, or depression, or worse. 

And then we were slammed with new threats – and a new norm – that feels every morning like waking up to de'ja' vu. Concerns from all quarters that what lies ahead could be far worse than the 1930s, the authoritative regimes that followed, and then the resulting global wars of the 1940s. What began in 1929, took until 1945 to establish a new global order. We can only wonder what shape our current world will take.

There are limits to all of our resources. And there are limits to what governments straddled with debt, the state and federal agencies, and kind-hearted individuals can do for increasingly mounting numbers of desperate people.

But the other side of the story, is that for those with any measurable assets need to take steps now to protect what you have. 

After all, your assets will protect you and your family from becoming desperate, too. If history is our guide, we've a long way to go. A lot more can happen, and things could get much worse, and for much longer. 

Are you willing to gamble your life savings that it will be happy days again soon? And what if you're wrong? 

Throughout history, during extraordinary times, risks arose not just from desperate people, but from thieves and thugs coming in different forms. Some were clothed with government or military authority, and others with weapons.

Rest assured, I’m a life-long optimist by nature. I feel positive that at some point, when we cross the bridge in the future, things will get better. But I’m also a realist. And a good student of history. It will take decades - or generations - to sort things out. 

What to do now?

The opening sentence to my first book on asset protection written in 1999 asked the question: What are the two greatest financial battles of life?

The answers are this: The first great challenge is to reach your goals and objectives.  The second great challenge is simply keeping what you have created.

The following pages in that book provide a long list of examples for a call to times like we are experiencing today.

For that reason, I encourage you now, more than ever before, to take whatever measures are available to protect your assets.

Even if you only take small steps like keeping a low profile, or using multiple bank accounts at multiple banks for maximum depositor insurance protection, consider diversify investments in different venues and jurisdictions to avoid having all eggs in one basket. Avoid personal guarantees. Have in place equity strips in place for hard assets like real estate. 

Better yet, use entities that you control to hold and own assets. Plan for a cross border International Trust - or a Standby International Trust - with integrated estate planning that holds title to underlying entities, registered in an asset protection friendly jurisdiction. Keep your assets outside the reach of where risks and litigation might arise. Use strong trust protective provisions over trustees that you, and your successors and heirs, control. The ability to quickly redomicile assets, or entities, or the trust, to another venue, or replace trustees, is essential. Level the playing field against known and unknown risks.

Is there a place for insurance? Yes, maybe, but in limited amounts. Think of insurance as throwing a dog a bone to go away. And keep in mind that umbrella policies are inexpensive with limited coverage. High-end professional and director liability policies can be very expensive or prohibitive. Insurance claims have limits, and even then, the claim may not be covered, or there's a hidden exclusion. Insurance companies can, and do, go bankrupt leaving you with no coverage even if there's a good claim. And what the insurer’s appointed defense litigation lawyers thrust upon you may not be in your best interest. 

I have repeatedly witnessed the worst of all of the above, and much more, during my nearly forty years of practicing law. I've represented insurance companies. And as a former civil court judge, litigation lawyer, international lawyer, and adjunct law professor, I've witnessed wealth quickly change hands even during normal times.  

The list goes on and on with positive opportunities to protect your assets. There are many other ideas covered in the above book How to Legally Protect Your Assets, 2nd edition, found right here

The take away - from Down Under - is that depending on the types and values of assets you own, how they are titled, where located, and your objectives, there are many steps you can take right now to protect your assets. This is true even with different asset types and levels. And always, your unique and individual characteristics and goals should be taken into account. 

The Aussies are watching America, and hoping for the best.

For now, I’m still here to share my nearly 40 years of planning experience and help you protect assets. Learn more at our site here.

And if you’d like to conduct a confidential review of your personal situation and see for yourself how international planning might fit into your future, contact me here.

Until next time…..

David


David A Tanzer, Esq.

JD, BSc, Ph.D (Hon)

 

For more information visit www.DavidTanzer.com or email to Datlegal@aol.com. David is the author of “How to Legally Protect Your Assets” and “Offshore Living and Investing.”

David A Tanzer & Assoc., PC.

Datlegal@aol.com
DAT@DavidTanzer.com
www.DavidTanzer.com


Vail, CO USA:

Tel. (720) 293-2272

Auckland, New Zealand:

Tel. (64) 9 353-1328

Brisbane, Australia:

Tel. (61) 7 3319 6999

(Licensed to Practice Law in U.S. States & Federal Courts; Assoc. Member Auckland, N.Z. District Law Society - Foreign Lawyer; & Assoc. Member Queensland Law Society, AU - Foreign Lawyer)


The comments herein are not intended to constitute a legal or tax opinion regarding any specific legal or tax issue as additional issues may exist; does not reach a conclusion with respect to any specific legal or tax issue addressed herein or any additional issues not included; and cannot be used for the purpose of avoiding legal or tax obligations or penalties with respect to issues in or outside the scope of matters discussed herein.


(c) Copyright by David A. Tanzer & Associates, P.C. All rights reserved. Except as permitted under the United States Copyright Act of 1976, as amended, and pursuant to the laws of all countries, no part hereof may be reproduced or distributed in any form or by any means, or stored in a database or retrieval system, electronic or otherwise, without the prior written permission of David A. Tanzer & Associates, P.C. Reprint in whole or part strictly prohibited unless prior written permission is granted. International Copyright protected under the Berne Convention, Universal Copyright Convention  and laws of all other Copyright protected countries, and consistent with the World Trade Organization TRIPS.

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