New Bankruptcy Law Demands Immediate Action to Protect Wealth

BEVERLY HILLS, Calif., April 14 PRNewswire/ -- At-risk individuals now have six months -- or less -- to maximize their protection from creditors and those who would seize assets. A wide-ranging bankruptcy law passed by Congress is now expected to be signed by President Bush and then go into effect later this year. This will significantly curtail the options available to those with a need to wipe their slate clean and start over. "The window of opportunity is closing, and may never open again in our lifetime," says Selwyn Gerber, Managing Partner of Gerber & Co., a CPA firm in Beverly Hills that specializes in asset protection and international planning. "The planning that one will need well into the future must be implemented now." For those who may be at risk in the future, Gerber has impassioned professional advice: take advantage of the next few months. "The fraudulent transfer rules have always worked to prohibit transfers of wealth in anticipation of existing liabilities -- the new laws go substantially further than that," he cautions. As part of an overall strategy to secure their assets against all risks and perils from both the creditors and the predators, Gerber says that every person of means needs a "wealth insurance policy." And only an international trust which protects both U.S. assets and, more critically, offshore wealth, "can offer true asset protection." "For most, this powerful tool is about to be taken away. Domestic strategies such as LLC's, LLP's and domestic irrevocable trusts will loose most of their protective power." The stakes could not be higher: if an offshore trust is properly structured and set up in advance of claims, both the trust and its assets will be outside the jurisdiction of the US courts. The so-called "Talent Amendment" to the newly-enacted bankruptcy legislation forbids trustees in most circumstances from accepting any transfers of property made on or within 10 years of a debtor's filing for bankruptcy. Only structures which are fully outside the U.S. courts' jurisdiction will be able to avoid this look-back period. Robert F. Klueger, an attorney specializing in asset protection and author of a best-selling book on the subject, predicts a sea change in the way asset protection is handled in the United States. "States such as Delaware and Alaska which have legalized domestic asset protection will see that side of their business fizzle." For the average citizen, Klueger concurs that time is of the essence. "Clearly the immediate task at hand is to set up a comprehensive domestic and international estate plan and asset protection strategy." "Wealth Protection" is the first but hardly the only benefit offered by offshore trusts. Once funds are in such a trust, the investor has access to a broad range of high performance securities not for sale in the United States. "Some of the Olympic champions of the investment world are not accessible to U.S. investors precisely because they seek to avoid doing business in this litigious environment," says Stanley Chesed of PrimeGlobal asset protection specialists in Beverly Hills. Amidst the current changes and challenges, one silver lining for the average citizen is that offshore trusts no longer have the kind of stiff costs and fees that have historically made them a tool only for the very wealthy. "Costs have plunged," says Gerber. "A reputable fiduciary company in Zurich charges our clients $2500 to establish a trust, and $2400 / year for maintenance. Add a few thousand dollars for a local advisor -- and the cost is minimal relative to the fortress that is constructed." About Gerber & Co. Gerber & Co. is a CPA firm in Beverly Hills that specializes in asset protection and international planning. For more information, please visit http://www.gerberco.com.