Cleveland Clinton and Gregory Sampson, of Gray Reed, have made available for download their article, “Trust Protector or Trust Defector? Five Hazards to Avoid in Appointing a Trust Protector”, published in JDSUPRA. The abstract is as follows:
Unanticipated changes in the law or circumstances may derail a careful plan to preserve a client’s intent to transfer wealth through trusts.
A “trust protector” originated from a need to protect offshore trusts from unchecked foreign trustees in unfriendly jurisdictions. Many planners now view it as an elixir to cure all unknown ills and as a staple in many planner’s forms for all planning.
We recently examined several different “train wreck” trusts – each with different protector concerns. Each was set on a course to destroy the grantor’s express plans; moreover, they all raised serious ethical questions and even possible fiduciary breaches by the planner or protector. Thus, our current top five warnings:
Posted by Marin Larkin, Associate Editor, Wealth Strategies Journal.