Now, go down to the bottom, paragraph 2, governing law and power to change it. This is a Cuba clause. We hide the fact that we’re basically saying to a U.S. judge that we’re going to change the ballgame. If you read paragraph 2, you’ll see it gives the trustee the power to change the rules that are applied to the trust assets. How do you do that? You move the trust.<\/p>

The settlor \u2013 this is the settlor\u2019s power. This is your power if you\u2019re setting this up. The settlor shall notwithstanding anything here into the contrary have the right to designate by will or testamentary document. That usually means something signed properly and often witnessed. Witness it with whatever, whatever type of formalities are required in whatever jurisdiction you’re going to. If you witness it as a will and in the United States, it will be almost always safe, but it’s a simple matter to simply get on the phone, talk with your trustee, see what they need and then overdo it. Never underdo it, always overdo it. The settlor has the right to designate by will or testamentary document the trust assets and\/or the share of trust assets to or for the benefit of beneficiaries, and to exclude a beneficiary.<\/p>

So, the settlor has the power to make people beneficiaries and to exclude people. For instance, many trusts have contest provisions. They have lots of things designed to penalize anybody who tries to get in the way of the management of the trust, and it is very common for somebody who challenges the trust to be made an excluded party.<\/p>

So, when your daughter turns 18 and runs off with the local Harley guy and wants her inheritance early and you tell her no and then threatens to sue you, with the right type of contest provision and the right type of structure, she\u2019s likely to become an excluded party. Well, when she\u2019s 25 she might have gotten her senses back, and you probably don\u2019t want her to be an excluded party. This gives you, the settlor, the power at any time to remedy those types of problems. It’s pretty neat.<\/p>

Now, paragraph 4 down or paragraph 3 down are what’s called powers provisions. You’ll see that a majority, a large part of this trust is focused in on making the trustee, empowering the trustee with the same type of power that a human being has over his own assets and that\u2019s important. If you don\u2019t give the trustee tons and tons of power, you’re going to have trouble. I\u2019m really going to go through this fast, and I expect you to read this tonight or tomorrow. You’ll see that there’s almost nothing that you can think of that the trustee doesn\u2019t have the power to do.<\/p>

Now, it would be considered bad form to make a client the protector and it’s only \u2013 you can only do it if you have a sincere understanding of what’s going on, and you’re smart enough to know when and if you need to get out of that provision. That\u2019s what happens with a kinetic plan.<\/p>

This is not a kinetic plan. This is set up as if you’re in what’s called red alert status on day one. This trust will hold up or should hold up under almost any circumstances, as long as when it was funded it was not funded with a fraudulent conveyance. Remember one of my earlier videos when I talked about the rules? I said, “A trust is a new baby; and if you give the new baby some money, that new baby gets to keep that money and that new baby is not responsible for your debts”. The only way to extract that money from your new baby is to claim that the act of giving that money to the new baby was a fraudulent conveyance.<\/p>

We’ll talk about that in great deal detailing where the lines are, but you know- again, this is great trust for just pulling out- reading. This trust will take care of 90% of you just the way it is without almost any changes. It’s not perfect but it’s damn good.<\/p>

Oh, here we go. This is another concept. See paragraph 18? This is the trustee\u2019s dealing with third parties. You’ll notice in all trusts- and it gets much more aggressive than this trust, the trustees are protected. They’re usually indemnified. They’re usually held harmless if something bad happens, this really freaks people out. The bottom line is you’ll never get a trustee, an institutional trustee without those provisions. It’s absolutely common in the rest of the world, and you also need to remember that even though Rob Lambert-you know, holds his head up high and says don\u2019t trust trustees; the people who are trustees are normally the- you know, leaders of their community. They’ve usually been there for a number of generations.<\/p>

The trust companies have been there for many many years, and they are usually the pillars of their community. So, they get kind of irritated with me when I say don\u2019t trust them. I still say don\u2019t trust them; and you’ll note that some of them will be speaking to the- you know, us at this site that- you know, that there are several that have asked if they can do videos introducing their countries. Well, they know that I say- assume they’re crooks; but you know what, you better make sure when you choose them that you really think they’re not. Always check references, and just don\u2019t be upset when you see provisions where the trust is required to indemnify, defend and not even go after the trustees for simple negligence. Usually, the only times you can go after the trustees is if they really engage in reckless behavior.<\/p>

So, paragraph 18, 19, 20, 21, 22, 23, 24, 25, these are- and even 26 and 27, are all provisions designed to make the institutional trustee relax and be willing to take your assignment. After all, you’re asking them to take on a very substantial fiduciary responsibility without too much compensation, at least the trust companies I\u2019m going to refer you to. If you want a fancy trust company, there are Cox and Wilkerson in Bermuda, Coutts & Company, that\u2019s Queen Elizabeth\u2019s trust company. They’re a huge huge great trust company; but they’re going to charge you a percent of your assets under management in tens of thousands of dollars in fees, and most of my clients don\u2019t want to trust somebody else to manage their money. So, you know, I guess I deal with different types of people.<\/p>

Now, paragraph 29, this is great. This is the protector\u2019s powers. I want you to all read this specifically. I want you to all read this tonight before the next class- but look, the protector can basically say no to anything. The protector can get out of anything. He can leave. He can be reimbursed. He\u2019s not liable for anything. The protector is protected almost like the trustee.<\/p>

Paragraph 30, no benefit for excluded parties. You know it’s a new concept, but don\u2019t you like the fact that if you put Joblo, the guy who\u2019s been suing you every time you get two nickels to rub together as an excluded party, he\u2019s going to be SOL when he tries to go to Saint Lucia or Belize or some place to go after your money- and by the way, once he goes there, he\u2019ll soon become dismayed because he will quickly find out that your money isn’t in those jurisdictions. One of my rules- and you all, I hope took my little course on rules. One of my rules is, your money should not be in the same country where your trustee resides. This is basically the end of the trust.<\/p>

You’re seeing it. You got the schedule where you have the trust fund. You put the assets there. What you’re putting into it- in the second schedule, the beneficiaries, which you can change at any time. That is a simple plain vanilla, generic, non-kinetic asset protection plan- asset protection trust. This thing is powerful enough to stop the largest creditors in their track, and it’s all of 21 pages long.<\/p>

Yeah, it’s a little crude. Yes, it’s a little simple, but it does the trick. Do you know what? A human being can understand it. It’s written in English. So, this is a good one for you to start with. Please read it tonight and get a good understanding. Next lesson is on common provisions and I look forward to that. In the meanwhile, do your homework, make sure you read the book and make sure you read this trust agreement before our next lesson.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t