Could This Be the Most Secure Place on Earth to Protect Your Assets?

Could This Be the Most Secure Place on Earth to Protect Your Assets?

By Mark Nestmann • February 4, 2020

The island of Nevis covers just 36 square miles, has 12,000 full-time residents, several hundred hotel rooms, and a tiny airport.  Perhaps best-known for its gorgeous beaches and the fact that former Monty Python star John Cleese lives here, Nevis lies two miles from the neighboring island of St. Kitts. Together, the two islands make up the Federation of St. Kitts & Nevis. 

I’m writing from the porch of the villa I’ve rented while I’m attending to matters relating to Fortress Trust Ltd. My business partner, Trey Wyatt, and I formed Fortress in 2014 to create and administer Nevis trusts, LLCs, corporations, and foundations.

Fortress is also licensed to process applications for the Federation’s citizenship-by-investment program. A St. Kitts & Nevis passport is an outstanding travel document, permitting visa-free or visa-on-arrival travel to more than 150 countries.

Former colonies of Great Britain, these sister islands have been independent since 1983. Each island has its own parliament with authority to enact laws over its respective territory. Since independence, the two islands took somewhat divergent paths. St. Kitts focused on creating a tourism industry. Nevis chose to mold itself into an international financial center.

The Nevis Parliament duly enacted a corporation statute in 1984, an international trust law in 1994, an LLC ordinance in 1995, and a foundation statute in 2004. As well, the Federation’s citizenship-by-investment scheme came into effect in 1984, making it the world’s oldest such program.

While the Nevis LLC, trust, and foundation statutes are among the world’s most innovative, in one aspect, Nevis is decidedly old-fashioned – its respect for privacy. As Nevis Premier Mark Brantley puts it, “We feel very strongly that people are entitled to some semblance of financial privacy. Why shouldn’t you be entitled to a secret?”

For instance, if you create a Nevis entity and later get sued, it won’t be possible for the plaintiff to find out any details about your company. Even the Financial Services Regulatory Commission, which oversees this industry in Nevis, doesn’t have this information available.

What’s more, judgments outside St. Kitts & Nevis against local entities aren’t automatically enforced. Instead, a creditor must retain a local attorney, who under applicable rules may not work on a contingency basis. The creditor must also post a $100,000 cash bond to cover any damages or court costs you might be awarded.

Nevis is also a “loser pays” jurisdiction: the prevailing party is generally entitled to have its legal fees reimbursed by the loser. Plus, the creditor must prove its case “beyond a reasonable doubt;” a far higher standard of proof than the “balance of the probabilities” requirement in effect in most US states.

Nevis LLCs and trusts have additional legal reinforcement. For instance, Nevis LLCs can’t be involuntarily dissolved. That means in the unlikely case a creditor prevails against your entity in a local court, the creditor can’t confiscate its assets. Indeed, the “charging order” is the exclusive creditor action permitted against Nevis LLCs. This order gives a creditor the right to receive only future distributions made from the LLC to you as the liable owner (“member”).

And if you create a Nevis trust, a creditor must commence a legal challenge within one year of its creation. If the creditor didn’t realize you created the trust, too bad.

But the most unique entity offered in Nevis is the foundation, technically known as the “multi-form” foundation. The term multi-form signifies that the entity can not only take the form of a foundation, but also an IBC, LCC, or trust. While the foundation represents the capital contributed to it, when formed as a foundation, this entity does not have an owner. The asset protection possibilities of this arrangement are obvious.

It's thus fair to say that Nevis has perhaps the world’s strongest privacy and asset protection laws. Although in recent years, its banks have been forced to comply with efforts by larger and more powerful countries to enforce those countries’ own tax laws. For instance, under the horrendous Foreign Account Tax Compliance Act (FATCA), Nevis banks must convey data on their US account holders to the IRS.

In recent years, owners of companies registered in the European Union, the British Virgin Islands (BVI), the Cayman Islands, and other nations have flocked to Nevis for another reason: its lack of a public registry of beneficial ownership.

For instance, in 2016, the UK enacted legislation requiring all private companies registered there to disclose the identities of "people with significant control" over the entity to the UK government. That information is now available in an online public register.

The UK then forced its overseas territories to follow its example. The deadline for the 14 territories to establish ownership registries is this year. These territories include the BVI, with more than 500,000 companies under management, and the Cayman Islands, with 100,000 companies registered.

For now, ownership data in the overseas territories need not be kept in a public register, but the UK is in ongoing discussions with them that will eventually require them to do so. And the fact that the register exists at all is a honeypot for identity thieves, kidnappers, and worse.

Nevis has no such requirement. While registered agents like Fortress must identify the beneficial owners of any entities it creates or for which it serves as registered agent, we aren’t required to share this data with anyone unless we’re ordered to do so by a local (not foreign) court or other local competent authority.

And we have good reason to keep this data confidential. If we release it without proper authorization, as company directors, Trey and I could be sentenced to a one-year prison term and fined $10,000.

In these uncertain times, could you benefit from a Nevis entity or a St. Kitts & Nevis passport? Get in touch to learn more.

Protecting your assets (and yourself) against any threat - from the government, the IRS or a frivolous lawsuit - is something The Nestmann Group has helped more than 15,000 Americans do over the last 30 years.

Feel free to get in touch at service@nestmann.com or call +1 (602) 688-7552 to learn how we can help you.

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About The Author

Since 1990, Mark Nestmann has helped thousands of clients seeking wealth preservation and international tax planning solutions. He is the author of highly acclaimed Lifeboat Strategy and other books & reports dealing with these subjects.

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