MIAMI, April 4, 2014 /PRNewswire-iReach/ -- Wednesday night's episode of The Daily Show with Jon Stewart included a comedic "exposé" on the increasing use of the Cook Islands as an asset protection jurisdiction. Comedian John Hodgman, who recently has portrayed the part of an eccentric and deranged millionaire on the show, conducted an "interview" on the subject with attorney Howard Rosen, of Donlevy-Rosen & Rosen, P.A. in Coral Gables, FL.
Rosen was chosen as the premier expert in Cook Islands asset protection planning, according to Hodgman in the piece.
Cook Islands Gets a Bad Rap
Rosen decided to participate in the interview because he wanted the field of offshore asset protection to be more fairly represented in what was going to be a one-sided take on the subject. "When we were contacted by the research staff some months ago, we knew what we were signing up for," said Rosen. "The show's fake-news format, and the subsequent discussion I had with John, led me to believe that offshore asset protection planning was going to take a beating," he continued.
And a beating it took. The five minute segment, titled "Tropic Plunder", correctly identified the Cook Islands as the top jurisdiction for offshore asset protection trusts. But the piece focused heavily on the concept that the jurisdiction is a haven for criminals and tax avoidance – which is categorically false.
Was Rosen pleased with the interview and his defense of Cook Islands trusts? "I stand by what I said in the interview", he said, "but the commentary before and after implies that Cook trusts are used by those wishing to avoid taxes or hide illicit money. That just isn't true."
In fact it couldn't be further from the truth. Many of the activities described in the segment could be considered money laundering. Professionals who knowingly assist in money laundering are held criminally accountable along with their clients.
What about the allegation that the Cooks are just a tax haven? "Also not true" said Rosen. Properly structured Cook Islands trusts are tax neutral; they neither increase nor decrease the tax liability of the person setting them up (known as the settlor). The settlor is responsible for paying the same amount of tax as if the funds were sitting in an account in his or her name at a US bank.
Rosen said he gets weekly calls from individuals interested in hiding money from the IRS, and he advises them all the same way. "US citizens cannot avoid tax by opening offshore accounts," he said, "and those that think they can get away with it by lying are the ones that end up in jail."
So if it's not tax-dodgers and money launderers who use the Cooks, who does? Donlevy-Rosen & Rosen, P.A., primarily presents high net worth individuals who have legally accumulated their wealth, paid (and will continue to pay) taxes on their earnings, and are merely looking to protect themselves from lawsuits down the road.
Recent Notoriety of Cook Islands
The Cook Islands have been brought to the front of a national debate on offshore banking and accounts. A recent New York Times article, in which Rosen was quoted, discussed the use of the Cook Islands for asset protection planning. A late 2013 report by the International Consortium of Investigative Journalists revealed hundreds of US persons who had illegally utilized offshore trusts to hide illicit funds or avoid taxes (none of whom were Rosen's clients). And earlier in 2013 the IRS announced it had reached an agreement with Swiss banks to report accounts held by Americans (again, not Rosen's clients) – a move that should stem the use of offshore accounts for tax avoidance.
Are Offshore Trusts Ethical?
The segment implies that utilizing asset protection is somewhat unethical. Rosen responded by pointing out that his firm and its attorneys have a perfect ethics track record: "We have zero bar complaints, and have the highest possible rating by Martindale-Hubbell for professionalism and ethics."
Rosen explained that there is nothing nefarious about asset protection when done within the confines of international law:
"The average American employs asset protection techniques every day and doesn't even know it – they own property jointly with their spouse, they invest their money in retirement plans, and they buy homestead real estate. Depending on the state, all these activities can be considered asset protection vehicles. If they start a business, they do so through an LLC, Limited Partnership, or Corporation, all of which are also asset protection vehicles. These vehicles derive their protection from federal and state laws. Cook Islands asset protection trusts are just another vehicle, based on international and Cook Islands law."
"Ironically," continued Rosen, "after the cameras were turned off, John expressed interest in our services for himself, and took some of our materials." Hodgman is a published author, as well as an actor and television personality. Due to attorney-client privilege rules, Rosen could not reveal whether Hodgman contacted him after the interview.
Link to video: http://trustne.ws/3yujh
About Donlevy-Rosen & Rosen, P.A.
Donlevy-Rosen & Rosen, P.A. is law firm with a national practice focused on asset protection planning and offshore trusts. Attorneys Howard Rosen and Patricia Donlevy-Rosen co-founded the firm in 1991, and have since become internationally recognized authorities in the field of asset protection planning. On the web: http://protectyou.com.
About Patricia Donlevy-Rosen, Esq.
Donlevy-Rosen is the author of "Asset Protection Planning," a Tax Advisors Planning Series book published by Research Institute of America. She concentrates her practice in the protection of immovable assets such as real estate. Full bio: http://trustne.ws/pdr.
About Howard Rosen, Esq.
Rosen, an attorney and Certified Public Accountant, is the founding author of the BNA Tax Management Portfolio "Asset Protection Planning" (1994, 2002), and is considered an authority on offshore asset protection planning. Rosen was an adjunct professor at the University of Miami School of Law for twenty years. Full bio: http://trustne.ws/hdr.
Media Contact: Sam Phillips, Donlevy-Rosen & Rosen, P.A., 800-417-7134, firstname.lastname@example.org
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SOURCE Donlevy-Rosen & Rosen, P.A.