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Sat Dec 14, 2013, 05:59 PM

Paradise of Untouchable Assets

Or why should the wealthy be accountable?

Picture a paradise where you can be lawsuit-proof. A place to hide your hard-earned assets far from the grasp of former or soon-to-be-former spouses, angry business partners or, if you happen to be a doctor, patients who might sue you.

Lawyers drumming up business say they have found just the place: the Cook Islands. And, thanks to a recently released trove of documents, it’s become clear that hundreds of wealthy people have stashed their money there, including a felon who ran a $7 billion Ponzi scheme and the doctor who lost his license in the Octomom case.

These flyspeck islands in the middle of the Pacific would be nothing more than lovely coral atolls, nice for fish and pearls, except for one thing: The Cooks are a global pioneer in offshore asset-protection trusts, with laws devised to protect foreigners’ assets from legal claims in their home countries.

The Cayman Islands, Switzerland and the British Virgin Islands capture headlines for laws and tax rates that allow multinational corporations and the rich to shelter income from the American government. The Cook Islands offer a different form of secrecy. The long arm of United States law does not reach there. The Cooks generally disregard foreign court orders, making it easier to keep assets from creditors, or anyone else.

Win a malpractice suit against your doctor? To collect, you will have to go to the other side of the globe to plead your case again before a Cooks court and under Cooks law. That is a big selling point for those who market Cook trusts to a broad swath of wealthy Americans fearful of getting sued, and some who have been.

“You can have your cake and eat it too,” says Howard D. Rosen, a lawyer in Coral Gables, Fla., who has set up Cook trusts for more than 20 years, in a video on his website. Anyone with more than $1 million in assets, his firm’s site suggests, should consider Cook trusts for self-preservation, but especially real estate developers, health care providers, accountants, architects, corporate directors and parents of teenage drivers.

International regulators have become more aggressive in efforts to clamp down on tax haven countries, offshore banks and their customers, but they have paid scant attention to the Cooks. Yet Americans are the biggest customers of the trusts, which may be held only by foreigners, not Cook Islanders. The islands’ official website calls the Cooks a “prime choice” for “discerning wealthy clients.” There are 2,619 trusts, according to the Cooks’ Financial Supervisory Commission, offering anonymity as well as legal protections. The value of the assets is not disclosed and it is against the law in the Cooks to identify who owns the trusts or to provide any information about them.


-more-

http://www.nytimes.com/2013/12/15/business/international/paradise-of-untouchable-assets.html?partner=rss&emc=rss&smid=tw-nytimes&_r=0



3 replies, 357 views

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Reply Paradise of Untouchable Assets (Original post)
Yo_Mama_Been_Loggin Dec 2013 OP
louslobbs Dec 2013 #1
seattledo Dec 2013 #2
El_Johns Dec 2013 #3

Response to Yo_Mama_Been_Loggin (Original post)

Sat Dec 14, 2013, 06:35 PM

1. Sounds more like the "Crooks Islands."n/t

Lou

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Response to Yo_Mama_Been_Loggin (Original post)

Sat Dec 14, 2013, 09:21 PM

2. This doesn't attack the real problem

 

Why are all of these wealthy doctors allowed to transfer money out of the country?

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Response to seattledo (Reply #2)

Sat Dec 14, 2013, 10:01 PM

3. +1

 

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