45 FAPT Offshore Cases: The Truth
If you've come across claims that these 45 FAPT
offshore asset protection cases "went wrong," you're not getting the full picture. A competitor has
misrepresented these cases, cherry-picking details while ignoring
the broader legal context that defines how
offshore asset protection actually works.
At Blake Harris Law, we've reviewed each of these cases and the facts speak for themselves. Here's what the record actually shows for these 45 FAPT offshore cases.
The court held the defendants in civil contempt not because the
offshore trust structure failed, but because the court believed they
retained control over the trust and thus did not sufficiently demonstrate their inability to repatriate the funds.
Re Lawrence
The court found that Mr. Lawrence had created a trust that appeared self-settled and retained de facto control, making it easier for the court to pierce it. Importantly, the court could not force the offshore trustee to return assets. What it did instead was keep Mr. Lawrence in contempt to coerce repatriation.
SEC v. Bilzerian
Bilzerian was found to have hidden assets in a manner that demonstrated clear bad faith and ongoing control. Offshore structures don't shield individuals from contempt if they maintain actual or perceived control.
BankFirst v. Legendre
Debtor jailed for contempt of court until assets were turned over five days later.
Barbee v. Goldstein
Goldstein funded an offshore trust over a year before filing for bankruptcy. The Bankruptcy Court ordered Goldstein to repatriate funds from the
Cook Islands Trust. Goldstein failed to comply and was jailed for contempt.
Chadwick v. Green
Chadwick was released after serving 14 years in jail for refusing to obey a court order to turn over $2,500,000 that a judge believed was hidden offshore.
SEC v. Jamie Solow
The court held that Solow's failure to pay was not credible. The most obvious issue was the fact that the offshore trust was established not just after litigation began, but after a judgment had already been issued by a court.
Morris v. Morris / Morris v. Wroble
Debtor jailed for contempt of court for refusing to repatriate assets.
Eulich v. United States
As part of its investigation, the IRS issued formal document requests and summonses seeking documents relating to a Bahamian trust and various corporations controlled by the trust. This case underscores the importance of maintaining detailed records and evidence.
FTC v. AmeriDebt Inc.
The offshore trust was found to be instrumental in the defendant's fraudulent enterprise. U.S. courts ordered the repatriation of assets. Failure to comply led to contempt charges, revealing that trusts rarely protect when fraudulent intent is proven.
Brown v. Higashi
The Belizean trusts established and controlled by the Browns were created by fraudulent transfers. As such, the assets of these trusts were property of the bankruptcy estate.
Fortney v. Kuipers
The trust remained intact, but the case illustrates that asset protection steps taken during active litigation can attract heightened scrutiny and unfavorable inferences, even if they are not ultimately set aside.
Advanced Telecommunication Network v. Allen
ATN sued to recover funds it had transferred to Allen, claiming the transfer was fraudulent. In a bankruptcy case, ATN had the transfer undone and obtained a court order to recover the money. Later, when Allen filed for bankruptcy, a court ruled that the money was protected by the automatic stay. That decision was overturned and sent back for further review. The higher court ruled that because ATN had already undone the fraudulent transfer and obtained a recovery order, the money counts as part of ATN's bankruptcy estate.
Rush University Medical Center v. Sessions
Under Illinois law, the trust was void, making trust assets available to satisfy the University's claim.
BB&T v. Hamilton Greens
Six months after the lawsuit was filed, one of the guarantors transferred almost all of his assets (nearly $1.7 million) to an offshore trust. After obtaining a $4.9 million judgment, the bank sought to invalidate the transfers to the trust as fraudulent transfers.
In re Portnoy
Despite the offshore structure, Portnoy retained considerable control and influence over the trust's administration. Portnoy initially denied the trust's existence, failed to disclose his salary transfers to his wife's account, and misrepresented his financial position.
SEC v. Brennan
The court's concern was not the existence of offshore trusts per se, but whether defendants were attempting to hide or retain the benefits of unlawful activity. Offshore arrangements used to shield ill-gotten gains are routinely scrutinized and disregarded where necessary to enforce securities laws.
In re Colburn
A debtor is barred from a general discharge if the debtor knowingly and fraudulently, in or in connection with the case, made a false oath or account.
In re Rensin
The court concluded that creditors could not obtain any relief regarding assets of the Rensins' trust without joining the Belize trustee to the case. The court declined to assert personal jurisdiction over the Belize trustee.
In re Cyr
The District Court decided "rent free and without charge" meant the same thing as "at no cost." As a result, the homestead was exempt from creditor claims in the bankruptcy.
Sattin v. Brooks
The bankruptcy court allowed the trustee to pursue claims to recover assets that may have been improperly transferred or concealed.
Riechers v. Riechers
Relying on settled principles of New York matrimonial law, the court held that
assets transferred into the offshore trust did not lose their character as marital property merely because they were placed beyond the court's territorial reach. The court ruled that the value of the marital assets transferred into the
Cook Islands Trust was subject to equitable distribution.
Westrate v. Westrate (1998)
Husband accused of fraud and threatened with criminal penalties. Assets included in marital estate.
Breitenstine v. Breitenstine
Husband took substantial steps to secrete his assets in protection trusts and various corporations. Husband never produced a proper accounting of these trusts and corporations.
In re Marriage of Harnack
This case concerns post-judgment issues arising from the equitable distribution of marital property following a dissolution of marriage. It reflects routine appellate supervision of domestic-relations proceedings, addressing ambiguity in post-judgment implementation rather than misconduct tied to asset-protection planning.
United States v. Thompson
The case did not involve lawful asset protection planning. Rather, it centered on willful concealment, non-disclosure, and defiance of court authority in the context of forfeiture and recovery proceedings. The offshore trust was relevant only insofar as it was used to obscure asset location and frustrate judicial oversight.
United States v. Butselaar
The Southern District of New York addressed a criminal tax evasion scheme in which a tax attorney helped a high-earning DJ conceal millions of dollars of income through offshore entities and trusts. The conduct involved deliberate misreporting, false structures, and concealment of taxable income from U.S. authorities.
United States v. Jerome Schneider
This case involved a criminal prosecution arising from the promotion of sham offshore banks and fictitious financial institutions marketed as tools to evade U.S. taxation. Schneider was charged with wire fraud and conspiracy after promoting structures that had no legitimate banking or trust function.
SEC v. Greenberg
The court's inquiry focused on non-compliance and potential asset concealment, not on the legality of any trust structure. The case illustrates that courts look beyond formal arrangements when evidence suggests that assets are being diverted or concealed to avoid satisfying judgments.
SEC v. Cook
Highlights that offshore Cook Islands Trusts, while strong, do not inherently shield assets from U.S. court orders if a fraudulent transfer is proven.
United States v. Grant
This case should not be read as a judicial determination that the offshore trust itself was ineffective or invalid as an asset-protection structure. The court did not void the trust, condemn offshore trusts as such, or hold that foreign situs alone rendered the arrangement illusory.
U.S. v. Plath
The court found Mr. Plath in civil contempt for failing to comply with IRS summonses and a court order directing him to produce requested documents. The contempt finding was based on noncompliance with lawful investigatory demands, not on the use of offshore entities or asset-protection arrangements.
United States v. Rogan
This case is about healthcare fraud and false claims submitted to the government, and the severe financial consequences that follow from unlawful conduct. Offshore trusts or other legal structures cannot be used to legitimize, conceal, or avoid liability for illegally obtained funds.
Indiana Investors v. Victor Fink
The defendant transferred assets into a domestic trust structured to allow a future shift of control offshore upon the occurrence of legal threats. Before that transfer could occur, plaintiffs obtained temporary restraining orders, freezing accounts and preventing any migration of control.
Gilmore Bank v. AsiaTrust New Zealand Ltd.
The decision did not involve a court invalidating or "defeating" an offshore trust. Rather, the holding was jurisdictional: because AsiaTrust purposefully availed itself of the benefits of conducting trust business with California residents, it could be required to defend itself in California litigation arising from those activities.
Bank of America v. Weese
Bank of America and other creditors of Bloomsbury brought suit against the Weeses, claiming they had fraudulently conveyed assets. Debtors paid a settlement of over $12,000,000 to avoid incarceration.
Netsphere, Inc. v. Baron
Federal courts found that trusts created by Jeffrey Baron, including the Village Trust, were shams designed to shield assets from creditors and the court, particularly after his company, Ondova, entered bankruptcy. The court found that Baron retained control over the assets and used them to hinder, delay, or defraud creditors.
In re Omegas Group
Datacomp argued that Omegas had committed fraud and, therefore, the money Omegas had received from Datacomp was subject to a constructive trust in Datacomp's favor and was not part of Omegas's bankruptcy estate. The bankruptcy court imposed a constructive trust on all funds received by Omegas from Datacomp.
FDIC v. Lewis
This case involves a judgment debtor (Lewis) who transferred significant assets, including into offshore trusts, to avoid satisfying a judgment held by the FDIC as receiver for AmTrust Bank. The court denied a request for a repatriation order to bring offshore assets back to the U.S.
Tinsley
Related to U.S. bankruptcy proceedings involving a Belizean
offshore asset protection trust. The court considered whether assets in a foreign trust are beyond the reach of U.S. federal courts, focusing on the necessity of joining the Belizean trustee to the proceedings.
