In theory, if maximum asset protection is your stated goal, nearly all moveable and liquid assets should be transferred physically to fund the offshore APT as soon as it is created. That includes cash and evidence of intangible assets such as stocks, bonds and other securities. These should be placed in the custody of the offshore bank or brokerage, to be used by the trustee. A formal assignment of title to the trust for each item should be executed by the grantor. Easily portable assets such as precious metals, coins, jewelry, or gem stones also can be transferred, with written evidence of the title transfer to the trust also needed.
Simply transferring titles to real estate or a business located within the U.S., or any home country, to a foreign trust provides very little absolute protection. That’s because the assets themselves remain within the jurisdiction of home nation creditors and courts. We have already cautioned about the legal difficulties of attempted property transfers to an APT at a time of personal financial crisis. In theory, such an act could bring the APT within the putative jurisdiction of your home country, if a judge uses the transfer as evidence to justify a finding the APT is doing business within that country. Such a judicial finding is not likely to have any meaningful impact on the APT itself, however, since it is not binding on the foreign court which does have jurisdiction.
There are more complex legal structures, which can include an offshore APT as a part, that offer greater protection for real property and business interests remaining within your home nation. For example, an APT can act as a managing general partner in a limited partnership that holds title to domestic property. Because of the complexity of bringing suit against an offshore APT, combined with the division of ownership and limited liability of a partnership, most adversaries will think twice before mounting such a chancy attack. This can be another productive settlement inducing arrangement.
One thing must be certain: the foreign-based managing APT trustee should have no U.S. connections that might subject him or her to direct or indirect pressure from U.S. courts. If an international bank trust department is being considered as your foreign trustee, ask them bluntly what their policy is in such situations. For all banking and investment purposes, it is essential to avoid an international bank that has local offices in your own home nation. The latter may be directly susceptible to back home official pressure, and that could jeopardize your APT if your home government goes after you and your assets.
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