Belize Trusts and Belize Bank Account

Belize Trusts – Belize trusts are world renowned for asset protection. The Belize trust is the strongest asset protection vehicle available anywhere.

The assets of a Belize trust cannot be attached to satisfy the judgment of a foreign court (non Belize) based on any foreign laws or statues. Belize Trust assets are immune from the decisions, judgments and determinations of foreign (non-Belize) courts. This includes claims of fraudulent conveyance. If the transfer of the assets to the Belize Trust is done with the specific intention to defeat or to shelter from collection efforts arising from the claims of creditors, and whether the claim and/or the judgment arose before or after the trust was created, the assets in the Belize trust would still be safe and secure. This is also applicable to the order or judgment of a foreign court in respect to marriage or divorce and claims by creditors in an insolvency (bankruptcy proceeding).

The assets of the trust are not subject to the laws relating to fraudulent transfers, the Bankruptcy Act and the Reciprocal Enforcement of Judgements Act which could ordinarily be used to reach such assets. Rare to find such protective legislation in any jurisdiction.

What is a Trust? - A trust is like a corporation but is not a corporation. A trust is a judicial or unnatural person, an artificial but legal entity. It is an entity that holds assets. The assets held by the Trust are not legally your assets, but belong to the trust. A trust has no share certificates and no owners. It has beneficiaries who are those that benefit from the trust. The trustee (Belize Lawyer) administers the trust according to the wishes of the trust for the benefit of the beneficiaries. A beneficiary can be a natural person, a corporation, foundation or another trust. The beneficiaries can be from any country. The protector which can be the settlor or a beneficiary oversees trust and the trustee and can replace the trustee at will. The settlor is the person who puts the assets into the trust. The Belize trusts are registered in a registry that is not publicly accessible. This is a simple over view and more details follow below.

Fraudulent Conveyance - Belize Trusts are NOT subject to fraudulent conveyance laws or attacks based on allegations of fraudulent conveyance. In many jurisdictions funds that are moved out of the reach of a creditor can be attacked for a period of two to five years. For instance in Panama the period is three years. Each time assets are moved into the trust or foundation the time period starts. This of course is not the case with the Belize Trust. The Belize trust is exempt from any fraudulent conveyance actions by law. If one is in a law suit or if a judgment has been awarded and the debtor removes the money or assets from the reach of the creditor (out of the country of the lawsuit for instance) the creditor can come to the country where the money is in most jurisdictions (the offshore bank jurisdiction) and start a fraudulent conveyance action in the civil courts as an effort to recover the funds that the creditor has a claim to in the foreign courts. This is impossible in Belize, with a Belize Trust since Belize Trust assets are exempt from the fraudulent conveyance law. This is the only jurisdiction providing such benefits today.

Lawsuit and Judgment Protection – If there is a lawsuit or a judgment issued by a foreign court (not a Belize Court) this judgment or court case cannot be used to attack your money held by the Belize Trust in a Belize Bank. Your financial enemy would need to institute a new and separate court case in Belize. This sort of action would have no chance of succeeding since it would be lacking venue and authority and goes against the Belize Trust Laws. Just because there is a trust and bank account in Belize it does not mean there are legal grounds to sue in a Belize court and in fact it is extremely difficult to get venue and authority if both parties are not located in Belize and the transaction was not conducted in Belize as well. The bottom line is the Belize trust is not going to be affected by court cases and court decisions that took place in other countries.

If you wish to see an extreme example of the protections afforded by the Belize Trust let us look at the case of the Securities Exchange Commission v. Banner Fund International. These folks were accused of all sorts of securities related fraud. We are not interested in the morality of their case for the purposes of this illustration of the Belize Trust law. They were found guilty and lost and then lost again on appeal in the US Federal Courts. The link to the underlying USA District Court Case is here:

SECURITIES AND EXCHANGE COMMISSION Washington, DC Litigation Release No. 15311

The defendants had a Belize Trust. The SEC applied for an order to compel the trustee for their Belize trust to disclose certain confidential trust information and turn over certain assets of the trust. The Supreme Court of Belize refused the order on the grounds that the application went against the relevant provisions of the Belize Asset Protection Trust Act. The Belize Supreme Court Judge, Mr. Justice Traodio J. Gonzales elaborated in an oratory as follows:

“the Asset Protection Trust Act goes to great lengths to reserve jurisdiction over Belize trust to the Belize Courts. Section 7(2) of the Act provides that only a Belize Court has the power to declare a Belize trust invalid. By section 7(6), Belizean Trusts are granted specific immunity against the judgments of foreign courts or claims based on the law of any foreign jurisdiction. In a jurisdiction, such as Belize, which offers international investors confidentiality and protection of their assets against foreign litigants and which has passed law towards those ends, it is important that judges, mindful of the legislature’s intention as set out in the law, support these principles of confidentiality, inviolability and exclusivity of jurisdiction".

Now that is asset protection. The point to learn from this is that not only are the Trust assets safe in belize but also the information pertaining to the Trust is also safe as well.

Lawsuit and Judgment Protection Extra Layers - If you wish to further layer the asset protection of the Belize Trust and Belize Bank Account we can have a Nevis LLC listed as the beneficiary of the Belize Trust. Using an anonymous corporation in the secure jurisdiction of Nevis as a beneficiary has a number of advantages for privacy and assert protection. This would require going to the courts in Nevis and posting a $25,000 cash bond to file a lawsuit to find out who owned the Nevis, LLC. Again such an action would be lacking venue and authority and has an overwhelmingly high chance of failure.

The Nevis LLC can be broken down by shares to distribute assets proportionately according to the wishes of the person creating the trust. This lets him conceal the beneficiaries from the trustee in Belize since the trustee has no way of knowing who owns the Nevis, LLC. No one on the island of Nevis has the owners name of the Nevis LLC but your financial enemy does not know this, does he? So if he actually ever got through the Belize courts (very unlikely) and finds out that the beneficiary of the Belize Trust is a Nevis, LLC then he has to go to Nevis to find out who in the world owns the Nevis, LLC. This is mandatory for him to show the courts in Belize that he has some legal standing to go after the trust assets.

Just what legal standing he would have in mind is hard to imagine but we are being extremely paranoid here so let's go with it. What if he gets into the Nevis, LLC and finds out the trust assets through the Nevis, LLC really belong to say the dog shelter of Havana, Cuba? In other words the burden of proof is on him to show the court that this trust is really your assets and this assumes that he can show under Belize law that he has a right to go after your assets which is a very unlikely scenario. Remember a Trust is a judicial person and the Trust assets are not your assets. Since in Belize the door is closed on fraudulent transfers your financial enemy has no way to get to the Trust assets. Again things ever getting this far are extremely rare but we are playing it out for those of you that need this extra layer of assurance. We believe it is important for our clients to sleep well at night and we take these concerns with the utmost degree of seriousness.

So now lets say your financial enemy goes to Nevis. Well he finds out that to bring an action in the Nevis courts he has to post a $25,000 cash bond. If he fails to prove his case this goes towards court costs and your costs involved in defending can be recovered as well from this $25,000. Figure after the Nevis lawyers discourage him they will hit him for $5,000 to $10,000 to review the case before filing. The opinion will be discouraging but if he wants to try they will want $25,000 to bring the action counting the initial payment. So it is a $50,000 hit (estimated) to try to see if he can find out who owns the Nevis LLC that is the beneficiary of the Belize Trust. This is after he spent a good $25,000 in Belize to get this far. That is an estimated $75,000. Many lawyers will charge more if they think the client has deep pockets.

Don't forget your financial enemy is also paying lawyers from the home country to go to Belize and Nevis to assist the local lawyers who do not know the merits of the case in the home country court where the case originated from. So his lawyers are drinking Margaritas on the beach while he foots the bill. Nice huh! There is also nothing preventing you from removing the funds from Belize during this fight as a protective measure and they know this or the local lawyers will soon inform them of this risk.

Now if you really wanted to be discouraging to your financial enemies you make them spend a lot of money and this is a big deterrent. So one can have the Nevis, LLC owned by another separate Nevis, LLC. This means your financial enemy would then if he won on the first case in Nevis (extremely unlikely) have to pay the lawyer again and post another $25,000 cash bond to go after the next Nevis, LLC records which would be a separate case. He will not be able to combine the cases because he does not know who owns the second Nevis, LLC. What if the Nevis, LLC had as an owner another Belize Trust? Then its back to Belize. See how you can drive the home country lawyers crazy and run up their legal fees enormously.

It would be most unlikely to see foreign lawyers chase you into these well sheltered jurisdictions. It is expensive, time consuming and most often futile. Once you know the chase is on the funds can be relocated again and again. Remember finding out who owns what and getting records is a far cry from any sort of a seizure order or freeze of a bank account. The offshore rules are different form the home country and this will confuse and frustrate the home country lawyers. What do they do when they get frustrated? They charge the client more money, that's what they do.

Belize Trust Banking - We do not like to open bank accounts for Belize Trusts. The banks cause us to alter the structure of the Trust weakening it for asset protection. What we do instead is open a bank account for a Belize bearer share anonymous corporation or a Nevis LLC corporation. Then we have the Trust own the corporation. This makes the corporation and it's bank account become Belize trust assets and thus they are immune from the decisions of a foreign court including fraudulent conveyance. A Nevis LLC, Another Belize corporation or another Belize Trust can conveniently be a beneficiary of the Trust. So now you are not a beneficiary of the Trust. This can be helpful if you have to go to a deposition or get examined in a court. Do you sign on any bank account for the Trust? Answer: NO. Are you a beneficiary of the Trust. Answer: NO. None of this is transparent in any public records or in any public database but in reality you do not sign on any such bank account because such a bank account does not exist. You are not a beneficiary because another trust or corporation is the beneficiary. The other side does not know this and could not ask questions pertaining to this since the facts are not in evidence.

Beneficiaries – These are the individuals, company or companies, trusts or other entities named to benefit from the Trust. Trusts are supposed to operate for the betterment of the beneficiaries. Trusts can make loans to beneficiaries. Trusts can acquire assets for the use of the beneficiaries like cars, homes, boats, etc. Trusts can invest money in gold, stocks, bonds etc. Trusts are useful to own intellectual property as well. Trust should not own active businesses like say a restaurant. A trust can own a corporation that in turn does own an active business.

Belize Trust Registry – Belize trusts must be registered. The Belize Register of Trusts is not publicly available online or in person. The trustee of a trust can provide written authorization to a specified person to query the Registry to ascertain that the trust is in fact registered.

The Trustee – This is the individual or entity who receives the property to be managed for the benefit of those individuals, companies, trusts, or other entities named as Beneficiaries. The Belize law firm acts as the Trustee. The trustee has a lawful obligation to confidentiality. The trustee has to respect confidentiality regarding any and all information regarding the trust assets, bank accounts, property and trust administration. The trustee is under no legal compulsion to conduct any sort of audit or financial inspection of any given trust for any reason.

The Settlor - This is the person, corporation, trust or foundation placing the assets into the trust. This will generally be you.

The Protector – This is an optional position. The protectors job is to supervise the trustee and make sure they perform their role as per the wishes of the settlor. The protector has the power to remove and appoint a new trustee. The protector may also be the settlor, trustee or the beneficiary.

Belize Taxes - A Belize trust and the trust assets are exempt from income tax, business taxes, estate, taxes, capital gains tax from bank interest or stock trading gains, inheritance taxes, succession taxes as well as any gift taxes. No Belize taxes is the simple version.

Time Frame – To form a Belize Trust and Open a Belize Corporate Bank Account takes two weeks.

Documents Required -

• A non-bank reference letters. This can be from an attorney or accountant.
• The letter should state that they know you professionally and they think you are a good guy or gal. We do not use a template to prevent having all the reference letters look the same.
  Letters should be on the professional letterhead.
• A notarized copy of a passport (picture page only).
• Copy of a utility bill showing address. Notarize copy of utility bill as a true copy of original. A credit card statement showing address can be used in place of a utility bill.
• Minimum Bank Deposit - $1000

Cost –The Belize Trust and the Belize Corporation bank account in Belize is $3795. If you use the optional Nevis, LLC with a Belize Trust it is $3995.00. Just a Belize Trust with no bank account is $1995.

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For Further Reading:

Belize Trust Act Revised 2000

Trust Amendments 2007