Cook Islands Trust Benefits & Setting It Up the Right Way
The Cook Islands trust has become a popular tool for those looking to protect their assets from lawsuits, creditors, and divorce. The Cook Islands are located in the South Pacific. They offer a number of advantages to those considering the formation of an asset protection trust. This includes a favorable legal system, protection from creditors, and flexibility in the structure of the trust. Here is a summary of the advantages. Then we will follow with a more detailed explanation of each.
Cook Islands Trust Advantages:
- Protection from lawsuits, creditors, and court orders originating outside of the Cook Islands
- Cook Islands trustee is not bound to U.S. court orders
- The Cook Islands legal system is a “defendant-friendly” jurisdiction
- Two-year statute of limitation in the Cook Islands on certain matters and a one-year statute of limitation on other matters
- Suppose a plaintiff file a lawsuit to seize your assets in your trust in the Cook Islands. If so, the legal burden lies on the plaintiff to prove his or her case. Most importantly, they must do prove their case beyond a reasonable doubt and do so in Cook Islands courts.
One of the key advantages of a Cook Islands trust is the protection it offers from lawsuits, creditors, and court orders originating outside of the island. That is, the Cook Islands is a “defendant-friendly” jurisdiction. For example, the legal burden is on the plaintiff to prove beyond a reasonable doubt that the defendant established the trust with the objective to defraud a creditor. This is a very high standard, and it makes it difficult for creditors and others to successfully challenge the validity of the trust. Additionally, a Cook Islands trustee is not bound to U.S. court orders, which further protects assets from seizure.
Cook Islands Trust Statute of Limitations
Another advantage of a Cook Islands trust is the statute of limitation on certain matters. The Cook Islands have a two-year statute of limitation on certain matters, and a one-year statute of limitation on other matters, which can provide additional protection for assets in the trust. Therefore, after a certain period of time has passed, creditors will no longer be able to bring legal actions to challenge the trust.
The Cook Islands Asset Protection Trust Act also allows the settlor/grantor of the trust to also be the beneficiary. This means that the person who establishes the trust can also benefit from the assets within the trust, which can provide a level of flexibility and control not found in other jurisdictions. This is a unique feature of Cook Islands trusts and can be a significant advantage for those looking to protect their assets.
A Cook Islands trust can also protect assets located outside of the Cook Islands. This is because the laws of the Cook Islands govern the trust. Moreover, they provide a safe and effective legal environment for the protection of assets. This can be especially useful for individuals or companies that have assets in multiple jurisdictions and want to ensure that they enjoy protection in all of them.
Electronic Access to Bank Accounts
Another advantage of a Cook Islands trust is the ability to transact with assets electronically. This can make it easier to manage and access assets within the trust, regardless of location. This can be especially useful for those who have assets in multiple jurisdictions, as it allows for easy access and management of those assets.
Finally, the Cook Islands offer a high level of flexibility in the structure of a trust. There is no requirement to publicly register the trust deeds. This means we can structure the trust to fit specific asset protection needs and investment opportunities. It also means we can tailor the trusts to meet the specific needs of the settlor. This is the case whether that it is protecting certain assets, providing for certain beneficiaries, or achieving certain investment goals.
Cook Islands Trust Benefits Summary
In summary, the Cook Islands offer a number of advantages for those considering the formation of a trust. These advantages include protection from creditors, a favorable legal system, flexibility in the structure of the trust, and the ability to transact with assets electronically. It is important to note that you should seek professional legal advice before establishing a trust in any jurisdiction.
How to Set Up a Cook Islands Trust the Right Way
Establishing a Cook Islands Trust can be a complex process, and it is essential to have the right legal team in place to guide you through the process. Attempting to “cheap out” can lead to mistakes and leave your assets vulnerable to creditors or lawsuits. An experienced asset protection attorney/consultant, such as the team at Asset Protection Planners, can provide the expertise, connections, and legal knowledge needed to establish your trust that can effectively protect your assets.
Before setting up a trust, it is essential to understand the parties involved in the structure of the trust. These parties include:
- Settlor: The person who is establishing the trust and transferring their assets into the trust.
- Trustee/s: The person or entity that owns the legal title to the assets, administers the trust. In addition, the trustee fights for the legal rights of the trust. In the case of a Cook Islands Trust, the trustee must reside in the Cook Islands.
- Trust Protector: A person appointed by the settlor to oversee the activities of the trustee and ensure that the trustee is acting in the best interest of the settlor. A trust protector should be a reliable and trustworthy individual, such as a fiduciary company or attorney.
- Beneficiary/ies: The individual or individuals who will benefit from the trust. The settlor can appoint themselves as a beneficiary, as well as family members, other people, and charities.
Once the parties involved in the trust have been identified, the next step is to gather the necessary documents and contracts to establish the trust. These documents include:
- Passport or driver’s license
- Evidence of funds
- Banking reference letter
- Proof of address
- Trust deed
- Deed indemnity
- Letter of wishes (optional)
- Sworn Affidavit of Solvency
It is important to note that our Cook Islands Trust package has a more comprehensive list of documents and descriptions. So, what happens once your provide all the required documents and sign the contractual trust agreement is signed? The answer is that you need to nowt fund the trust by transferring assets into it. These assets can include liquid assets, investment portfolios, company stocks or shares, intellectual property, real estate, cars, or boats.
Once the trust is funded, the settlor can have peace of mind knowing that their assets will be protected should any risk arise in the form of creditors or lawsuits.
Who Can Establish a Cook Islands Trust?
In terms of who can set up a Cook Islands Trust, it is important to note that anyone can set one up, but it is not advisable to do so without the help of an experienced asset protection attorney. The team at Asset Protection Planners has the appropriate relationships with reputable banks and trustee companies and can help set up a trust that is structured for your financial benefit. It is not necessary to travel to the Cook Islands to establish a trust, and our team can schedule meetings via phone or teleconference with potential trustees and bankers.
Why Cook Islands Trusts?
Here are some other reasons we choose the Cook Islands.
Cook Islands Trusts offer several additional benefits that make them a popular choice among individuals and businesses seeking to protect their assets. Some of the key advantages of include:
- Protection from creditors: The legislation protects trust assets. This makes it difficult for creditors to access assets held in the trust. This is particularly useful for individuals and businesses that are at risk of lawsuits or other legal proceedings.
- Confidentiality: They offer a high degree of confidentiality. That is, nobody files the trust documents with any public registry. They are not disclosed to the public. This makes it even more difficult for creditors and litigants to locate and seize assets held therein.
- Tax efficiency: Cook Islands Trusts are not subject to local taxes. So, the only taxes that are usually due are those in one’s home country.
- Flexibility: Highly customizable and we can work with you to tailor it to suit the specific needs of the settlor and beneficiaries.
- International recognition: Courts and legal systems around the world recognize Cook Islands Trusts. This makes them an effective way to protect assets in multiple jurisdictions.
- Independent: It’s a unique jurisdiction in the South Pacific. The Cook Islands is part of New Zeeland and the British Commonwealth. However, it has a distinct legal system that is separate from New Zealand and the United Kingdom.
- Long Case Law History: The Cook Islands International Trusts Act 1984 provides the legal framework for the establishment and operation of trusts in the Cook Islands.
- Reputable: The Cook Islands is one of the most reputable offshore trust jurisdictions in the world.
- Privacy: It has a strong history for providing privacy and confidentiality, which is critical for high-net-worth individuals and families looking to protect their assets.
- Strict Laws: The Cook Islands has strict laws that protect the assets of trusts from creditors and lawsuits, making it an ideal jurisdiction for asset protection.
It is important to note that while Cook Islands Trusts offer several advantages, they are not a one-size-fits-all solution. It is important to consult with an experienced asset protection attorney or consultant to determine whether it is the right choice for your specific circumstances.
- C.I. Trusts: An Overview, by D. H. Smith, published in the Journal of Asset Protection. 
- International Asset Protection: Strategies, Forms and Laws, by M. Shenkman. 
- The C.I. Trust: A Guide for the International Practitioner, by M.G. Pfeifer, published by Juris Publishing. 
Cook Islands Trusts can be a powerful tool for protecting assets from creditors, lawsuits, and other legal proceedings. However, they are not suitable for everyone and should only be established with the guidance of an experienced asset protection attorney. The team at Asset Protection Planners has the knowledge and expertise to help you establish a trust for your needs and goals. Contact us today for a complimentary consultation to see if a Cook Islands Trust is the right choice for your asset protection needs. With our team you can feel assured that your trust will be established properly and with all the necessary documents and contracts. We also have the required relationships with reputable banks and trustee companies that will make the process of establishing your trust run smoothly.
Give us a call at +1-954-400-1050 or fill out a free consultation form on this page.