The Plight of Billionaires Looking For New
Havens to Shield Assets
by James F. McDonough, Jr. on July 30, 2013
In a recent article in Wealth Management, the author David de Jong and Robert Lafranco describe the difficulty billionaires face in providing a safe haven to shield assets.
For example, they point out the troubles of Dimitry Rybolovelev who is Russia’s 14th
richest person and is embroiled in a multi-jurisdiction divorce action with his wife. The
lawsuits provide a window into the offshore structures and secrecy jurisdictions that
billionaires use to manage, preserve or conceal their assets. A desirable offshore
jurisdiction has several characteristics. In the past, bank secrecy, nominee shareholders or bearer shares and no annual reporting were of primary importance in the selection process. Other desirable features include: (1) a low or no income tax; (2) taxing income earned within its borders; (3) a stable political environment; (4) adherence to the rule of law; (5) a strong banking sector; (6) access to income tax treaties if needed for business and investment; (7), little or no wealth (transfer) taxes; (8) and a flexible roster of entities, such as trusts, foundations, corporations, companies and partnerships.
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