by Mark Nestmann, Nestmann.com:
Asset protection used to be easy. If you got in trouble, you’d just move to Florida, buy some property there, and then declare bankruptcy.
In the 1980s, Marvin Warner, former US ambassador to Switzerland, football team owner, and horse lover, was a poster child for this strategy. A savvy and politically connected entrepreneur, Marvin was implicated in a financial scandal that led to the collapse of his Ohio-based Home State Savings Bank. Taxpayers ultimately picked up the tab for a cool $144 million.
Marvin wound up paying $4.5 million in his bankruptcy settlement and spent a couple of years in prison. But he was able to protect a substantial part of his wealth, thanks to Florida law. He sold his horse farm in Ohio and bought another one in Florida for $2.2 million. As a Florida resident, he also invested $3 million in annuities. In Ohio, creditors would have been able to grab all but $5,000 of these assets. In Florida, they couldn’t take any of it.
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