Safeguarding Wealth with Blake Harris- Episode - 545

Every single person in the Cook Islands will eventually own land. Land is passed down through the bloodline. It cannot be sold. You cannot lose your family's land. So everyone in the Cook Islands has a vested interest in seeing the system stay in place. In terms of getting along with the United States, Cook Islands really doesn't do anything to upset or bother the United States. It's a very small nation. It's just thought of as a beautiful spot in the Caribbean, which it very much is.

True financial freedom has no borders. In Shield Wealth, we'll discover how the ultra-wealthy move beyond the limits of domestic protection to safeguard their legacy on a global stage. Welcome to Streams to Impact, brought to you by Stetaker Capital. I'm your host, Dr. Allen. For many high achievers, wealth can start to feel fenced in, trapped by taxes, lawsuits, and the limits of domestic protection. But beyond those fences lies open range where your assets move freely, your legacy stays secure, and your money finally works as hard for you as you worked to earn it. That's the frontier we're exploring today in Shielded Wealth, where the ultra-wealthy safeguard their fortunes on a global stage. And it's the same path that leads directly into the Great Tax Escape. Where the world's most financially free quietly redirect taxes into appreciating income-producing assets. So if you're ready to protect your wealth and let it run free, visit thegreattaxescape.org and begin your ride toward freedom. Now take a deep breath, feel the reins in your hands, and let's ride together into today's conversation. With Blake Harris. Just a brief disclaimer, all information shared on the Expert Investor Roundtable is for educational purposes only and should not be construed as investment, financial, legal, or tax advice. All investments involve risk, and you should consult your advisors before making any investment decisions. What happens when a master of wealth protection takes his expertise beyond borders? Well, you get Blake Harris, the founder of Blake Harris Law and one of the world's leading authorities on offshore asset protection. Blake has traveled to over 40 countries building a global network of trust companies and bankers dedicated to helping clients secure their wealth and preserve their legacy. His insights have been featured in Bloomberg, Forbes, and MarketWatch, and he's taught thousands of professionals how to safeguard What they've built through legal, ethical offshore strategies. Recognized as a Super Lawyers Rising Star and an AV Preeminent Attorney, Blank combines deep financial knowledge with a rare passion for helping families achieve lasting peace of mind. Today, he joins us to reveal how the ultra-wealthy quietly shield their assets And how you can too. So welcome, Blake, to Streams to Impact. We are happy to have you with us here today. So let's just get started. You have helped clients move their wealth beyond domestic borders. So what first opened your eyes to the importance of international diversification and essentially offshore protections?

So the first time I really heard of offshore trust goes back to about 15 years ago, over 15 years ago at this point, I was sitting in a class in law school and I had an excellent trust and estate professor who was talking about all the different types of trust available. And when it came to offshore trust, in the course of an entire semester, I think he spent about 30 seconds and all he said was, offshore trust exists, but I would never set one up for a client. And I went by and being the curious young law student I was, I said, why would you say don't ever set up this type of trust? And his response was, well, don't ever set up this type of trust unless certain criteria are met. And I was like, okay, so in certain cases you would recommend them. And it gave me an idea. Teacher, professor, you continue to tell everyone else, don't go into offshore trust, and I'm going to look into this deeper and not have any competition from my other law students. And many years later, that's very much what happened. I graduated law school, I started working for a trust and estate law firm out in Colorado, and maybe my third day on the job, I started digging into what are the more complicated type of trusts available. I wanted to do something that was a very unique service that not a lot of other attorneys either had the intelligence or devoted the intelligence time to really understand. And I started discovering the world of international asset protection planning. My law firm that I eventually started soon thereafter was just a few blocks away from another law firm's office, which was run by an individual named Barry Engel. Barry Engel was the OG in the industry. He's the one who wrote, along with another attorney at the Cook Islands, the initial International Trust Act in the Cook Islands. And Barry was a mentor of mine for a very for quite a few years before he unfortunately passed away. I found it very interesting. I found it more than just being interesting, a great service for the clients. And as I dug into the case law of a domestic trust versus an offshore trust, I quickly realized one of these is a wonderful thing for a client, and the other one, in my opinion, is a disservice to the client. I think that domestic trusts are often misrepresented when they are being sold to the client about the level of protection they received, and that's not the style of attorney I am. I'm one who wants to build something for the long term where clients come back and say, you know, Blake, we took your advice, we set the structure up, and it actually worked. So it was a combination of early years being pointed in a direction or being— or gravitating towards this area and then being reinforced with good mentorship. And then for the past many years, I have spent extensive time traveling. I have been to nearly 50 different countries, met with trust companies, bankers, protectors, attorneys, CPAs all over the world. And we have built up a giant arsenal and a giant team that helps our clients protect their assets in a way that I don't think any other firm comes close to the capabilities that we have.

Well, that's quite a legacy and a background. And you certainly articulate the fact that certainly offshore planning and offshore trusts and offshore protections are much more complicated than just keeping things local. So it being a complex process, how How do you reframe it so that it is an act of empowerment and financial sovereignty rather than an avoidance or a secrecy or something shady? Because, I mean, we often associate with offshore dealings as something they do in the islands where there's no regulation and so on and so forth. So how do you bring that home to clients?

Well, a few different points there to address. As far as regulations are concerned, the trust companies we work overseas are better regulated and supervised than US-based trust companies. The economy of some of these countries we work in relies heavily on the business we bring them, and they don't want to do anything to compromise their reputation as a safe jurisdiction. To the comment of offshore work being shady, there is this brainwashing that goes on by the American media that any business that's done internationally is shady, which is complete nonsense. It's the same thing that Americans have, that America's safe and the rest of the world is dangerous. But you get to spend some time out of America, you're going to find a lot of people think America is very dangerous and a lot of the rest of the world is actually very safe. On top of that, and this is not you, Alan, this is not me, and this is not anyone who listens to your show, but beyond that, Americans overwhelmingly are very narrow-minded. Most Americans have never left the United States, and those who have, most of them have not gone anywhere beyond Canada or Mexico. But for people who are going to be better prepared for the decades to come, they have an open mind to looking for— to finding and utilizing international solutions to their problems. And those are the ones who are taking advantage of using international laws for wealth protection.

So it makes, it makes perfect sense to me. But I mean, in its complexity, and there's obviously differences between international trusts and domestic trusts, as you have already pointed out. Can you just briefly summarize really what are the main differences between offshore trusts and local trusts?

I can make this very simple. One of them is going to hold up under pressure from the U.S. court system, the other one's not. The offshore trust industry has been around longer than the domestic trust industry. The Cook Islands passed their International Trust Act back in the mid-1980s. It wasn't until around 1998 that the first domestic state, Alaska, passed an asset protection trust law. Since then, the case law has shown that if you put enough pressure on a domestic trustee, they will release the funds, and because of this, the settlement leverage that you get with a domestic trust is far worse than the settlement leverage that you get with any offshore trust. So the difference is, number one, protection, number two, settlement leverage, number three, which I consider perhaps the most important, is the overall peace of mind, the confidence that you get knowing that your assets are not going to be compromised because of a U.S. court order.

Well, that's quite a significant difference, to be certain. And I, I'm suspecting that most people that you deal with are surprised to realize that there's greater protection offshore than here in the United States. How do you, how do you deal with that?

Well, I wouldn't necessarily say that most people are surprised. I actually think it's fairly logical. Also, the people who come to me, it's a little bit self-selecting that they have been watching some of my content that I put out, we put out a lot of content. I have hundreds of thousands of followers on social media. I've written several books on the topic. I have taught extensive continuing legal education, and I'm frequently, frequently talking about the difference in the case law. And beyond just the case law, there's also the logic that goes into it, that if you are a plaintiff, put yourself in the shoes of somebody going after another person's assets. Which would you rather, them have their assets held by a Nevada trustee in a Delaware bank, or them having their assets in a Cook Islands trust which then owns a Swiss bank account?

Very easy.

I would much rather try to attack the one who I can call up a law school buddy of mine and say, hey, I know you are licensed in Delaware now, put a freeze order on this bank in Delaware. Boom, just like that, the domestic trust has been compromised or at least weakened. So I think it's something that is fairly logical. There is the concern of the safety of the foreign trustee, which we do need to educate our clients on, and this is why when it comes time to do asset protection planning, it is essential that you work with a highly reputable partner so that we are putting you in touch with equally reputable people. There are questionable people overseas or questionable people domestically, but there are definitely very trustworthy people in both situations as well. So what you want to do is work with a trustworthy person in a secure jurisdiction.

Well, I think most investors really understand the importance of networking, and certainly you just emphasized that, although yours isn't really domestic networking, it has been international. Very much so. And you've visited some 40 different countries and have really worked at developing that network. So that certainly is going to give clients some level of trust just in the fact that you have that well-developed network. Well, you had mentioned that international trusts are more complicated. Can you give us an idea in terms of What is the complication in foreign trusts that we wouldn't have domestically?

I think it boils just down to the reporting requirements. The trust is tax neutral. It does not increase or decrease your taxes whatsoever. But when you have an offshore bank account or an offshore trustee, you do have to fill out a few additional forms when it comes time to complete your taxes in FBAR 3520, 3520-A. And this is why we give all of our clients a detailed memorandum on how to complete those reporting requirements. As long as you have that memorandum and a good CPA, it doesn't really cause a whole lot of headache beyond that. And that is kind of the reason that— or that is the point of attack that the pushers of domestic planning will go after and say, oh, you have to do the offshore reporting requirements, which is true, but that's really just the cost of getting protection that works.

In terms of that, I mean, you just mentioned the aspect of cost. Uh, what's the cost differentiation between, uh, Domestic and international?

So I would say a domestic trust on the low end could run anywhere from maybe $10,000 to $20,000, and an offshore trust is going to run somewhere probably $20,000 to $40,000 on average. So in general, it does cost more initially to set up an offshore trust, but in the long run, when it comes time to actually use the thing, you're going to find that your settlement leverage is much better. What you don't want to do is try to save a few thousand dollars up front and then cost yourself in the long run hundreds of thousands of dollars or potentially even millions of dollars in settlement cost, or simply losing all of your assets because the domestic trust failed under court pressure. So while there is a larger investment upfront, in the long run, the better value is the offshore trust.

It sounds to me like really the complexity is on the attorney's side, and it's really not that significant from the client side. And there is going to be more cost up front, but it could save you millions. Exactly.

And exactly, your CPA prepares a few more tax forms, you click DocuSign a few times, you click a button a few times extra, it costs you a few thousand dollars extra, and you actually get to sleep well at night.

Could you just give us an idea in terms of trusts being, being pierced? How frequent is that for domestic trusts?

I would love to go through the case law, but we don't have several hours to go through it. There have been many times when domestic trusts have been compromised, and even beyond that, there have been lots of times when a defendant had to pay out a hefty settlement when a domestic trust was under attack, whereas with an offshore trust, we've seen situations where not only do clients get favorable settlements, but sometimes the plaintiff will outright just drop their case. They don't even want to pursue it and go after the offshore trust. So there's definitely case law out there which shows the vulnerabilities of domestic trust.

Suppose a person has just come to the realization that they aren't as protected as they thought they were because their trust or trusts are all held domestically. Where should they begin to really rethink their asset protection and get started on moving to a more certain trust Sooner the better.

Contact my law firm. We can generally take whatever trust the client already has and redomicile it overseas, or take the current trust, pour it into a new trust overseas, and then fix whatever mistakes that their previous provider may have set up for them.

Since you mentioned your law firm, go ahead and tell us how it is that we can contact you.

Sure.

So I run the nation's largest exclusively offshore asset protection law firm. We are in 4 different continents, we're in several different countries as well. My team and I service clients worldwide. If you'd like to get in touch, visit our website blakeharrislaw.com. If you're not quite ready to buy but you still want to learn a little bit more about asset protection, we are on all the major social medias @BlakeHarrisLaw, or you can give us a call, 833-ASK-BLAKE, or just send me an email Blake@BlakeHarrisLaw.com. A member of my team will reach out to you quickly to schedule a call and discuss whether setting up an offshore trust is the right fit for you.

So tax laws and inheritance rules and all kinds of regulations are constantly shifting. What kind of effect will domestic laws have on international trusts, if any at all?

Well, as I mentioned, the trust is tax neutral. You still have to report the trust, you still have to pay taxes on any income that the trust produces or any capital gains. It does not have any effect in that way. Beyond that, it's something that the U.S. government doesn't really get involved with in terms of politics. You hear discussions over war or over, I don't know, whatever the hot topic is right now, but you're not hearing offshore trusts being discussed as anything that they want to do anything about. Maybe it's because it's such a niche field that not a lot of people are taking advantage of these Or maybe it's because a lot of the politicians and the people who fund the politicians have offshore trusts themselves, and they're not rushing out to pass laws which hurt their own position.

So what might be the income level that a person would want to think about this? Would somebody with a high W-2 income find this valuable, or do they need to have a certain level of of net worth before they think of these kinds of things? Who, who is this really for?

So income is not the primary concern, because if you have an individual who makes $500,000 a year but spends $500,000 a year, there's nothing really in there to protect. On the other hand, if you have an individual who makes $100,000 a year but they only spend $50,000 a year, and for 10 years they've been saving up and they have half a million dollars or more that they want to protect, then an offshore trust may be appropriate for them. In general, we see most of our clients' net worth starting at around $2 million, though we do have quite a few clients whose net worth is under $1 million. And while we do have some, what I would consider super wealthy clients in the high tens of millions, and even some clients who we've worked with that go beyond that, most clients have somewhere between about $2 and $20 million in assets. These are the people who are actually most likely to be sued, and these are the people who really need the settlement leverage the most. If an individual worth $200 million gets hit with a $5 million judgment, it's not going to have any real effect on their quality of life or standard of living. On the other hand, if there's an individual whose net worth is $2 million and they get hit with a $5 million judgment, that could be devastating. They need the power to negotiate. They need the power to reach a settlement. So it's usually low millionaires that are setting up offshore trusts. clients whose net worth is in the low millions.

In terms of, of overall planning, if they're going to have an offshore trust, is there any reason to have a domestic trust? Are they just totally and completely different things and it's either one or the other, or do they work together?

Well, there's lots of different trusts and there are lots of different reasons to set up a trust. So for example, we would also recommend clients have a domestic estate planning trust or revocable living trust for distributing their assets after, after they pass away. The offshore trust can do that, but if you're getting into a lot of different requirements for beneficiaries or distributions over different periods of time, we generally recommend clients set up a revocable trust to handle those distributions. Also, if clients have other issues that they want to address, such as tax planning, an irrevocable life insurance trust may be recommended as well, but it's not the case that we really have recommended clients set up both a domestic asset protection trust and an offshore asset protection trust. It just doesn't make sense to have both. If you have a Rolls-Royce, you're not going to want to drive around in your Toyota. You're going to want to drive around in the offshore trust option.

Well, you had mentioned the Cook Islands a couple of times, and yet you traveled internationally and you're currently traveling internationally. Is— do you generally work with the Cook Islands, or do you have trusts throughout different nations throughout the, throughout the world?

We've set up trusts in multiple different jurisdictions. However, the vast majority of the work we do is in the Cook Islands, and for the past few years, my law firm has set up more trusts in the Cook Islands than any other law firm in the world.

Why is it that Cook Islands is preferred?

So in terms of options for setting up an offshore trust, there's a couple of dozen different countries which will allow you to set up an offshore trust. However, in terms of jurisdictions which routinely and gladly take Americans, and they have good codified case law supported legislation, there's only 3 options that really stand out: Cook Islands, Nevis, and Belize. Belize, great laws in place, not the most stable place to do business. We prefer not set up a trust in Belize if we can and get it set up in one of the other jurisdictions if need be. We might transfer a trust that's under attack to Belize, or if we can't get a client accepted in one of the other jurisdictions, we may look at Belize, but it's not our first choice. Nevis is a close second place to the Cook Islands. They copied— they drafted their legislation to model after the Cook Islands legislation. However, Cook Islands has been in the business longer. Their increased distance from the United States is a deterrent to litigation. We just see more of a commitment towards the asset protection industry in the Cook Islands than we've seen in Nevis. So our first choice is Cook Islands, followed closely by Nevis and then Belize.

Well, you mentioned that— mentioned this aspect of stability, um, and there's all kinds of things that can produce instability across the globe. And if you find yourself upsetting the United States, the— you are almost guaranteed that your government is going to be destabilized in some way, shape, or form. What if that happened to the Cook Islands?

Well, first of all, let's talk about stability of the Cook Islands. Let's compare it to the United States. In the United States, we have this situation where the younger generation is very much losing interest in the system. They are not being able to buy homes. They're having trouble getting good jobs. They're having trouble Keeping up with the cost of living. Because of that, they're having trouble marrying and starting families, and they've really lost a lot of interest in seeing the United States continue if it's not showing them a hopeful future. Compare this to the Cook Islands, where every single person in the Cook Islands will eventually own land. Land is passed down through the bloodline. It cannot be sold. You cannot lose your family's land. So everyone in the Cook Islands has a vested interest in seeing the system stay in place. In terms of getting along with the United States, the Cook Islands really doesn't do anything to upset or bother the United States. It's a very small nation, just thought of as a beautiful spot in the Caribbean, which it very much is. Hypothetically though, if there was an issue in the Cook Islands, we have the ability to re-domicile the trust in another location.

So what are the biggest drawbacks for putting your trust internationally?

Biggest drawbacks. Well, first of all, clients have to pay our fee, which I mentioned is going to run around $30,000. There are the offshore reporting requirements, which we give clients a detailed memorandum on how to complete those with the help of a CPA. It's really nothing to worry about too much. And then beyond that, you don't get to stay up all night worrying about losing your assets.

So $30,000 sounds like pretty reasonable. I mean, Domestic trusts are running close to that as well.

Correct.

Yeah, so that seems pretty reasonable to me. Outside of that, I mean, what are the most common fears that, that you hear that, that people bring to you? And what is it that they most often want clarity on before they go through with this?

Well, I mean, people come to me with fears of lawsuits more than anything else. And then it's getting confidence in the partners we work with internationally. The trustee that I recommend has been in the industry quite a while. He's become a very close friend of mine. We've traveled together, we've gotten to know each other's families as well. And in time, he's one of the actually people I trust most in my circle overall. And because of the amount of travel I've done, the amount of time we've spent together, that trust passes on to other people as well. You hear it in my voice. And when we travel, we often bring other team members as well. I was just in the Cook Islands a week— a few weeks ago. We had 6 of us there. Very few other attorneys have been to the Cook Islands, let alone bring a team the size that we have. So we go deep into the people, into the getting to know the people we work with, because it's all about trust and building those relationships. And yes, you can get a lot done over a Zoom call, but there's special energy that gets transferred when you meet with somebody in person. And I think it's very important that we preserve that and that we'll be able— and that we were able to bring that back to our client base.

Well, Blake, is there anything else that you would like to cover that we haven't covered thus far?

Well, let's take a moment and talk about the ethics of offshore trusts. You start off by saying people wonder if these are shady and/or if it's improper to do asset protection planning is another question that I received. And I do I do not subscribe to the theory that there's anything honorable or anything ethical about being weak, about being unprotected, about being vulnerable. Freedom does not exist without protection. So if you are not doing everything you can to make yourself as strong and as safe as possible, you're doing a disservice to yourself, to your family, to whoever it is that you are supposed to take care of. And there's no better way to secure your future and your family's future than properly setting up Well, Blake, it has truly been a pleasure having you with us, a very enlightening conversation.

So thank you so much for being with us. And enlightened investors, uh, if you've enjoyed today's show, and I'm sure you have, please take a moment to like, share, and subscribe, and we'll see you in the next episode.

Rock and roll, Alan. Thanks for having me. It's been fun.

What a powerful ride. Today, Blake Harris reminded us that true wealth isn't just about what you earn. It's about what you keep, protect, and ultimately pass forward. The ultra-wealthy have mastered that game by expanding beyond borders, building structures that safeguard their freedom and their families for generations to come. But protection is only half the story. The next step is putting those shielded assets to work, legally redirecting what you already pay in taxes into appreciating income-producing investments. That's where the Great Tax Escape begins. So if you're ready to step out of the corral and ride into the open range where your wealth works as hard for you as you worked to earn it, visit thegreattaxescape.org. There you'll discover the same strategies the world's most financially free have used for decades to grow and preserve their wealth. Until next time, this is Dr. Allen inviting you to keep your money moving with purpose, your vision clear, and your impact expanding.

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