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Hiding assets and finding assets are reverse sides of the same coin. Everybody seems to use the same techniques. No. 1, you look to set up a family trust in Nevis or the Cook Islands. It’s better there because of secrecy laws and laws that emasculate creditors’ rights. So let’s say I owe you $10 million and I don’t want to give it to you. I give it to a Nevetian trustee for my benefit and say I want to invest it in a cattle ranch in Montana and in stocks and bonds. The trust subscribes to share capital in a long chain of companies in 5 or 10 jurisdictions offshore, like Jersey and Guernsey. Secrecy makes the relationship between the assets and the U.S. more remote.
Beyond Nevis, the British Virgin Islands are popular. In addition to some confidentiality, they’re cheap. Bermuda is more expensive, but it’s the king of offshore insurance. Cayman is for offshore banking. Another option is to use layers of companies to mask the owners of the assets. One of my cases involves ownership of office buildings in Canada. They were owned by a series of numbered companies. You don’t need a name there, just a number, like 8769542, Alberta Inc. The equity was held by a series of offshore companies that was further held by a Netherlands Antilles company. Behind that was a trustee in Guernsey, and behind that was a man who stole $250 million using a mass-marketing fraud. He sent mail solicitations to elderly American citizens. There were more than 300,000 victims. The money got transferred to bank accounts in the Netherlands, Switzerland, Jersey, Barbados, and Canada. There were like nine tiers in nine different countries, through so many bank accounts and companies that it could take years to investigate if you don’t know what you’re doing. And to keep your assets hidden, you have to be careful who you alienate. One man took his girlfriend to Switzerland and stayed in a fabulous hotel and had lunch across the street from where we found $40 million in cash deposits. She was pissed off and told us. We were pulling rubbish from his trash, in Sarasota, Fla. He had a mansion on the beach there. For 18 months we pulled his trash, every week at 6 a.m. We found an envelope with a return address and name of an insurance company at a P.O. box in Philadelphia. It turned out he had insurance on 72 works of art—Monets, Manets, Degas, Rembrandts—under names of corporations he owned. When we served subpoenas on the insurance company, they had to disclose who bought the art.