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THE SOVEREIGN SOCIETY OFFSHORE A-LETTER
Your Link to Freedom, Privacy & Prosperity in the Offshore World
Wednesday, October 27, 2004 - Vol. 6 No. 206
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In This Issue:
* COMMENT: Nevis LLC Cuts Your Exposure.
* OFFSHORE: Swiss-EU Accords. Swiss US Election Cash. Jersey Dirty Cash. No Antigua-US Deal. BVI Follows EU Orders. Nabbed in Belize.
* WEALTH: Belgian Tax Flop. Castroization of the $. Corporate Fraud.
* PRIVACY & RIGHTS: Peeping Tom Phones. Passports. Media Threat.
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Guest Comment is by MICHAEL CHATZKY, JD, a member of the Sovereign Society Council of Experts and a leading US asset protection attorney.
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COMMENT: Nevis LLC Cuts Your Exposure.
Dear A-Letter Reader:
A limited liability company (LLC) is a statutory entity in which the owners are called 'members.' Each member is generally granted limited liability for LLC liabilities. This is legally superior to a limited partnership in which general partners are held personally liable for partnership liabilities. Thus, an LLC is preferable to a limited partnership when the goal is to buy and hold assets that may expose the company to potential liability. (LLCs can have only one owner as the member, if you so choose).
Similarly, shareholders of a corporation are granted limited protection against liabilities of the corporation. However, corporate shares can be attached by personal creditors of a shareholder. But a creditor of an LLC member has only a restricted, solitary remedy called a 'charging order.'
This remedy enables a creditor with a judgement against an LLC member to seek a court order that merely entitles him to receive LLC distributions (if any) that otherwise would have been paid to the LLC member.
A foreign limited liability company is similar to a domestic LLC except that it is based offshore, typically in a jurisdiction that provides maximum LLC flexibility and maximum asset protection. Some years ago the government of the Caribbean island of Nevis enacted 'state of the art' LLC legislation, and thus Nevis is often used as the situs for foreign-owned LLCs.
Unless the operating agreement of a Nevis LLC states otherwise (which would be extremely unusual), no member of the LLC is liable for any LLC obligation (except to the extent that member assumed such liability under a personal guarantee or other contractual arrangement).
From an asset protection perspective, Nevis LLC assets are protected from creditors of its members, except when creditors have obtained a charging order. Under Nevis law, the charging order is the exclusive remedy available to a creditor of a Nevis LLC member.
Then too, the cost and inconvenience of litigating a claim in Nevis can dissuade many creditors from pursuing their claim and can encourage favorable settlements.
A Nevis LLC can be used either as a stand-alone entity, or with an international asset protection trust (APT). In the latter case, the Nevis LLC typically serves as the owner of a business and/or owner of investment assets, while the international APT serves as a member of the limited liability company. This provides an effective dual layer of asset protection that is difficult to crack. And Nevis has the laws that make this possible.
Michael Chatzky, JD
E-mail: mgchatzky@aol.com
Chatzky & Associates, 6540 Lusk Boulevard, Suite C121
San Diego, CA 92121 Tel: 858-457.1000
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COMMENT LINKS:
* More about St Kitts & Nevis. LINK:
http://www.interknowledge.com/stkitts-nevis/knpnt03.htm
http://www.odci.gov/cia/publications/factbook/geos/sc.html
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* OFFSHORE *
SWISS, EUROPEAN UNION ACCORDS SIGNED
BRUSSELS: Swiss, EU hail signing of bilateral accords. LINK:
http://www.swissinfo.org/sen/swissinfo.html?siteSect=111&sid=5297011
* Swiss money funds US presidential elections. LINK:
http://www.swissinfo.org/sen/swissinfo.html?siteSect=161&sid=5257230
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MAJOR JERSEY DIRTY CASH CASE
ST. HELIER: Fraudster in court in £20m money laundering case.
LINK: http://www.thisisjersey.com/news/news4.html
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NO ANTIGUA-U.S. DEAL ON OFFSHORE GAMBLING
Parties fail to reach deal on WTO complaint against US.
LINK: http://www.tax-news.com/asp/story/story.asp?storyname=17720
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BRITISH VIRGIN ISLANDS FOLLOWS E.U. ORDERS
ROAD TOWN: New corporations law conforms to EU demands.
LINK: http://www.tax-news.com/asp/story/story.asp?storyname=17725
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MIAMI FUGITIVE NABBED IN BELIZE
BELIZE CITY: Capture of Miami Beach 'Top 10 Fugitive'
LINKS: http://www.state.gov/r/pa/prs/ps/2004/36918.htm
http://www.citydebate.com/florida/miamibeach/template.php?url=0110170404.htm
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* WEALTH *
BELGIAN TAX AMNESTY FLOPS
BRUSSELS: Offshore funds stay there; don't come home.
LINK: http://www.tax-news.com/asp/story/story.asp?storyname=17712
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CASTRO'S SUICIDAL REVENGE
HAVANA: Cuba to end circulation of US dollar. LINK:
http://news.ft.com/cms/s/e431fbba-2727-11d9-a0dd-00000e2511c8.html
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I.R.S. HIGHLIGHTS CORPORATE FRAUD
Examples of IRS corporate fraud investigations. LINK:
http://www.accountingweb.com/cgi-bin/item.cgi?id=99952&d=815&h=817&f=816
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* PRIVACY & RIGHTS *
ULTIMATE PRIVACY INVASION
Peeping Tom filter lets phones see through bikinis. LINK:
http://networks.silicon.com/mobile/0,39024665,39125257,00.htm
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AIRLINE PASSPORT WARNINGS TO TRAVELERS
Families traveling urged to comply with new regs or else.
LINK: http://news.bbc.co.uk/1/hi/business/3951173.stm
* Travelers without visas need machine readable passports.
LINK: http://news.bbc.co.uk/1/hi/uk/3953237.stm
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EU AGREES TO BIOMETRIC PASSPORTS
Passports with fingerprints, digital photos coming soon. LINK:
http://www.signonsandiego.com/news/world/20041026-0746-security-eu-biometrics.html
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U.S. SEIZURE OF WEB SERVERS CALLED THREAT
Indymedia web server takedown called free speech threat. LINK:
http://www.forbes.com/business/feeds/ap/2004/10/26/ap1611278.html
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THE SOVEREIGN SOCIETY OFFSHORE A-LETTER.
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