A Cook Islands Trust is a type of offshore asset protection trust established under the laws of the Cook Islands, a self-governing nation in the South Pacific known for having some of the strongest asset protection laws in the world. It’s specifically designed to protect assets from creditors, lawsuits, and legal judgments.
Why Set Up A Cook Island Trust?
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Strong Asset Protection:
Cook Islands law does not recognize foreign judgments, meaning a U.S. court order has no authority there. Creditors would have to file a lawsuit in the Cook Islands to pursue assets, which is extremely difficult, expensive, and time-consuming. -
High Legal Standard for Creditors:
To succeed, a creditor must prove beyond a reasonable doubt (a criminal standard) that the trust was set up to defraud them—an extremely high legal bar. -
Short Statute of Limitations:
Claims against a Cook Islands trust generally must be filed within 1–2 years of the trust's creation or the transfer of assets, which limits creditor actions. -
Confidentiality:
The trust structure and its beneficiaries are not publicly disclosed, helping maintain privacy. -
Flexibility and Control:
While a foreign trustee administers the trust, the settlor (the person creating the trust) can still retain significant influence through mechanisms like a protector or investment advisor. -
Legal Precedent:
Cook Islands trusts have a long track record of withstanding legal challenges, making them a trusted tool for high-net-worth individuals and professionals at risk of lawsuits.
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