I’m often asked is there any advantage in spreading your Offshore Company and or Offshore Offshore Trust and or Offshore Foundation and Offshore Bank Account across several jurisdictions?
The bottom line is the more jurisdictions you mix into your structure the harder you make it for people to attack your (Offshore) assets.
Say you have 3 structures in place ie an Offshore Company an Offshore Trust and an Offshore Foundation (ie a serious asset protection structure). Say a firm of vulturous lawyers are suing you and they suspect you have assets held by an Offshore Company (from which the Lawyers hope to extract recovery for their client + a fat fee for themselves).
The first thing that would happen is the vultures would try and find out who owns the Offshore Company. Unless you are involved in some very serious criminal activity (eg drug trafficking, money laundering, terrorist financing etc) no one should be able to find out who the owner/shareholder of that Offshore Company is (or who the beneficiaries of any Offshore Trust or Offshore Foundation beneath it are – see below).
To crack the privacy veil anyone wanting to either (a) attack/get hold of assets held by the Offshore Company or (b) find out who actually owns the Offshore company would have to apply to the Supreme Court of the Country where your Offshore Company is incorporated for a disclosure order ie a court order compelling the names of the shareholders/owners of the Offshore Company to be revealed.
Before the Court will even hear the application the vultures would have to produce evidence ie a prima facie case proving that the Offshore Company or persons closely connected to it have more likely than not been involved in serious criminal activity as defined.
If they do get the order they would find that the Offshore Company is owned by an Offshore Trust in a 2nd country.
The lawyers for the vultures would then have to pack their bags go home and start all over again. That is they would then have apply to the Supreme Court of the country in which the Offshore Trust is registered for a disclosure order (ie for an order requiring that the names of the beneficiaries of the Trust be revealed). Again, usually before the Court will even hear the application, the vultures would once again have to produce evidence ie a prima facie case proving that the Trust or persons closely connected to it are more likely than not to have been involved in serious criminal activity as defined.
Say by some miracle they do get that order. All they will find out is that the sole beneficiary of the Trust is a Foundation registered in a 3rd jurisdiction.
The lawyers for the vultures would then (again) have to pack their bags go home and start over. That is they would then have apply to the Supreme Court of the country in which the Foundation is is registered for a disclosure order ie a court order requiring that the names of the beneficiaries of the Foundation be revealed. As usual before the court will even hear the application the vultures would again have to produce evidence ie a prima facie case proving that the Foundation or persons closely connected to it are more likely than not to have been involved in serious criminal activity as defined.
And if the Offshore Company’s bank account is held in a 4th country the vultures would need to appear before a Court in that 4th country seeking an order that the Company’s Bank Account in that country be frozen (ie pending finalisation of litigation/claims against the company or its owners).
As any experienced litigation lawyer will tell you what’s described above is the lawyer’s equivalent of having to climb Mount Everest. The time it would take and the legal costs involved would be virtually inestimable.
It should come as no surprise to anyone then (given the proliferation of litigation lawyers and the advent of information exchange between OECD type jurisdictions) to hear that the use of multi-national Offshore Corporate Structures is on the rise.
Hopefully after reading the above you can well understand why…