Safeguarding Your Legacy Wealth
Capital Markets Made Simple
Experience the peace of mind that comes with expert asset protection.
Our exclusive focus at Capital Market Attorneys, a Dodson Robinette subsidiary, is protecting your family’s wealth and assets from creditors, lawsuits, and courts.
Our experienced attorneys are here to guide you through the complex world of asset protection and estate planning through LLCs, trusts, and other estate strategies to help safeguard your financial future.
Contact us today to schedule your consultation and take the first step toward securing your financial future.
Why Choose Us?
Capital Market Attorneys offer asset protection estate strategies utilizing LLCs and trusts to insulate your assets from lawsuits and creditors. They provide a free evaluation of your asset holdings and risk analysis to provide the best strategy advice for your unique situation. They can guide you through the complex asset protection laws and offer advice for both domestic and offshore strategies.
Their attorneys can advise you on how to structure your assets to minimize the risk of being sued. They have experience with laws in multiple jurisdictions and can help you create a bulletproof plan for your long term protections. Their goal is to help you protect your interests and achieve peace of mind. They offer free consultations to discuss your options and answer any questions you may have. Contact them today to take the first step towards securing your financial future.
Worried About Your Financial Future?
Protect Your Wealth
Does This Sound Like You?
Do you feel like
your hard-earned assets are vulnerable to legal threats, and you don't know where to turn for help?
Does it seem
like you have no outside help or resources to protect your assets, leaving you feeling exposed and vulnerable?
Are you frustrated that
the legal environment is becoming increasingly complex, and the market is unpredictable, making it harder than ever to protect your assets and secure your financial future?
And when it comes down to it, do you
want to take control of your financial security and protect your assets from potential threats, without feeling overwhelmed or uncertain about where to start?
Why You Need Asset Protection
The entire purpose of asset protection is to make sure that these creditors cannot take ownership of your assets. Your assets are available for your personal and family wealth creation and succession. If a lender is suing you, here’s a great opportunity to be able to protect your interests in business, personal assets, other valuable assets, to protect your family’s resources from the reach of claims. The types of personal creditors that it may protect against could include litigation creditors, credit cards debts, and other loans.
Using a mixture of LLCs, trusts and other business entities, we work to organize a structure, that creditors can’t reach the assets held.
With a limited liability company, charging orders are collection orders from courts for creditors. A court can enforce it against your ownership, your direct ownership of an LLC. But in quite a few states used for asset protection structures, the courts are not allowed to actually take the ownership of the LLC interests. Courts then allow what’s called a charging order which means that any payments that the LLC is distributing to the owner subject to the charging order may be redirected to the creditor.
With a limited liability company, charging orders are collection orders from courts for creditors. A court can enforce it against your ownership, your direct ownership of an LLC. But in quite a few states used for asset protection structures, the courts are not allowed to actually take the ownership of the LLC interests. Courts then allow what’s called a charging order which means that any payments that the LLC is distributing to the owner subject to the charging order may be redirected to the creditor.
What’s actually the point of this if the creditor can still get the profits? Well, there’s actually a simple answer for this by having the LLC cease distributing profits. But if you are still maintaining control, as the management of the LLC, you still have check writing capabilities over the assets within the LLC, you can still use the funds that are within the LLC for investing purposes or buying other assets to maintain the investing businesses’ operations. Regardless of the charging order, you can still as the management of the LLC, buy assets, make loans, transfer and sell assets.
So in lots of states, single member LLCs meaning there’s one owner you there’s one manager you some are weaker protections. Courts are more likely to pierce the corporate veil, meaning treating the assets like they are owned by an the individual and not a separate business entity. While this happens in some states, we utilize other legal structures such as corporations and limited partnerships to maximize the legal protections without risking these court systems.
There are also other states that created their laws to allow asset protection as a sole owner, manager, and even the grantor of a protective trust structure. Nevada and Wyoming are two states that have heavily emphasized and created asset protection favorable laws. Both of those states have a long history legislative history court history of protecting asset protection trusts and LLC protections.
Who is a creditor? A creditor is a person or entity that has a current right to collect against the borrower or guarantor due to some written agreement or order by a court of competent jurisdiction. This is where it gets really important. Because if you get sued, the plaintiff is not a judgement creditor until they receive a judgement. Even then, the creditor can’t automatically take your ownership in your LLC.
After the creditor wins their lawsuit, get a final judgment that sticks, and then they get into a collection phase. During this time, they’re seeking the charging orders or foreclosures of assets. That’s not to say you shouldn’t plan early. In fact, it can take years of proper planning to ensure that an asset protection strategy actually protects assets held by the structure.
The three primary strategies a creditor may attack an LLC is by seeking a charging order against the LLCs owners, alternatively the creditor can seek to foreclose on the ownership interest, or seek an involuntary bankruptcy against the LLC debtor. It’s important to know that involuntary bankruptcies can ultimately dissolve the business cause it to sell the LLC assets. This generally happens not because of an owners personal debts, but actually due to business debts that makes the business itself insolvent. Because of this risk, we’ll generally advise and coach clients to maintain asset protection through a holding company that does nothing further than maintain the assets and investing practices.
It’s important to know that all trusts are not created equal. When it comes to asset protection, only irrevocable trusts may be used to protect assets within the asset protection structure. Lots of people have revocable grantor trusts or commonly known as living trusts. Living trusts are really an estate planning tool, and it provides zero asset protection. All of the assets within a Living Trust are still the grantors personal assets, all of which are still subject to attachment, lawsuits and debt collection from creditors.
Irrevocable trusts can be used as an asset protection vehicle when they include enforceable spendthrift provisions. A spendthrift provision within a trust agreement directs the trustee to not make any beneficiary distributions if the trustee believes that the distribution is being forced by or intended to be utilized for payment of beneficiaries creditors. The purpose of the spendthrift provision is to make sure that the funds, the assets, whatever is held within the trust is actually going to the beneficiaries and not going to the creditors.
We’re generally leveraging irrevocable trusts, meaning that once the trust is set up, you cannot change it. The trust terms are set in stone, and the laws require trusts to specifically be that way or a court can order the amendment of a trust within the powers of a grantor. If an asset protection vehicle can be changed at any time, court can order a grantor to change that trust. That’s why these irrevocable trusts are very important components of setting up an overall asset protection vehicle.
To summarize, an irrevocable trust means it cannot be changed. A revocable or Living Trust means that you can change the trust at a later date. Living trusts are great tools for estate planning and are often part of a comprehensive succession plan, but they’re not a tool for asset protection.
What is a trust? In general, a trust is a written agreement between a trustee and grantor/trustmaker for the benefit of the grantors’ chosen \beneficiaries. A self settled spendthrift trust is only allowed in a few states and means that a trustmaker can: (a) set up the trust, (b) personally fund the trust, and (c) still be a beneficiary with distributions protected via spendthrift provisions. We generally use Nevada Asset Protection Trusts because the State of Nevada has long term asset protection laws that have gone through many legal challenges and have maintained their protective enforceability.
The trustee is the manager of a trust, and generally ends up having the authority to control how assets and funds are invested. Oftentimes, the trustee can also decide how distributions to the beneficiaries take place. But the trustee is limited by both their fiduciary obligation as well as a trust agreement.
All trusts are managed by trustees which are fiduciaries on behalf of the beneficiaries. As fiduciaries, trustees have an obligation to act in the interests of beneficiaries and avoid conflicts of interests. A fiduciary duty means that the trustee has an obligation to act in the best interests of the beneficiaries, at least to the extent that they have an intent to act in the best interest of the beneficiaries. It’s not an absolute privilege, meaning they are responsible if they make a bad investment, but it does require that the trustee made the investment with the belief that the beneficiaries were going to benefit. Tt doesn’t necessarily mean that the trustee is responsible to the beneficiaries for a loss, as long as they did it with a reasonable judgment that the investment was sound and with an intention of all the benefits going to the beneficiaries.
Not creating conflicts of interest is a component of the fiduciary duty and means a trustee should generally not be doing business with or making loans, investments, or contributions to other entities or businesses that the trustee has an interest. Obviously, it’s a conflict of interest when a trustee makes a loan to himself.
We can set up a trust structure both in the United States as well as we can set up offshore asset protection trust structures. One of the biggest benefits of setting up an offshore trust structure is a limited statute of limitations on unwinding the trust funding. In the US, all states have a statute of limitations that allows a court to unwind an asset protection transfer if it’s done within a certain time period. Offshore in asset protection friendly jurisdictions, you are protected immediately upon funding as long as you don’t have a current debt, or a lawsuit already being enforced In you transfer your assets. Offshore structures are protected day one of funding.
In the United States, all states have laws relating to what’s called the fraudulent conveyance doctrine. Under the fraudulent conveyance doctrine there’s a statute of limitations, that if a court determines that you transferred assets with the specific purpose of defeating a creditors claim, a court can actually unwind the transfers, completely defeating the purpose of asset protection.
Without beating around the bush, all asset protection involves transfers for the purpose of defeating creditor claims. However, as long as you do it early enough, a court will not unwind the asset protection funding, but if it started too late, a court may unwind it and fraudulent conveyance. It doesn’t necessarily mean you’re committing fraud but is what the set of laws are called. In the United States, most statutes of limitations are four years. A few states, like New York, have a 6 year statute of limitations on asset protection transfers. Nevada has the shortest timeframe in the US with a two year statute of limitations which is a major reason why we organize these trusts within the State.
Getting back to these offshore structures, there is no statute of limitations meaning there’s no fraudulent conveyance doctrine. However jurisdictions will still not protect the trustmaker if they already have a judgment or a creditor, or it may not protect the assets if a lawsuit is already pending.
Generally, we organize offshore trusts in the Cook Islands which is a small island off the coast of New Zealand. Cook Islands does not recognize US judgments. Meaning that if there’s a US creditor that’s trying to pierce the veil, of your Cook Islands trust, guess what, they’ve got to bring a lawsuit in the Cook Islands to enforce. Even the US authorities, federal government, nor the SEC/FBI don’t have any power or control over these offshore trustees either. Even punitive damages are not enforceable in the Cook Islands for any lawsuits that are brought to tell you a little side story because it’s they are bulletproof from the financial aspect.
There is a quick summary of asset protection, and some of the different components and tools that are used to advise our clients on best practices and strategies to create legally enforceable asset protection strategies. It is important to know that asset protection is not one-size-fits-all and everyone’s needs may direct different strategies. Let’s be honest, at the end of the day, nothing is guaranteed and on a long enough timeline in most business lawsuits happen. Now be prepared to protect your estate and family with our proper guidance on long term protections.
