I want to say to my long-time blog followers.....didn't I tell you.....Facebook and Dimon's bad bets.....all plans laid out a few years ago. Regulators writing the Financial Reform bill having public protections for IPO listing like Facebook's simply shelved the rules....media was all over it back then but said nothing in the leadup to the Facebook listing.....they all knew the public would be stuck with stock that had little room to grow.
The wealthy on the other hand have politicians working double time to solidify their fraudulent fortunes. I spoke of dynasty building plans......hiding estates from estate taxes and now an insurance that shields all that wealth from legal claims. They commit a crime and are sued hundreds of millions.....the insurance company will pay. This has been the case for corporate executives but now they have extended it to family wealth. It all happens in friendly Third Way states like Biden's Delaware and Harry Reid's Nevada.
We are already starting to hear the rumblings of pundits warning of recession if you let those Bush Tax Cuts expire.....this economic downturn will go on for years, don't let them use this as continued reason for falling to end tax cuts. They expire automatically....Republicans have nothing to do with it. The expiration of these cuts alone will fulfill the $4 trillion in deficit reduction politicians want with no need to cut entitlements, poverty programs, or education. THE AMOUNT YOUR TAX BILL WILL GO UP IS SMALL COMPARED WITH THE WEALTHY....THAT'S WHY THEY FIGHT IT. IT IS A WIN WIN FOR PROGRESSIVES IF BUSH TAX CUTS ARE LET TO EXPIRE...DO NOT LET THEM TELL YOU OTHERWISE! SHOUT OUT----END BUSH TAX CUTS TO AVOID ENTITLEMENT AND POVERTY CUTS!
Wealthy Americans Turn to Trusts to Shield Assets
By Elizabeth Ody - May 23, 2012 12:01 AM ET Bloomberg Financial
Executive-liability insurance is often the first line of financial defense for executives and directors caught up in litigation such as investor lawsuits. For others without such coverage, asset-protection trusts are the way many insulate their wealth from claims.
“For a businessperson who’s in a competitive environment in which you see a lot of business litigation, I would say it’s prudent planning,” said Duncan Osborne, a partner with Osborne, Helman, Knebel & Deleery LLP in Austin, Texas. “That lawsuit’s coming sooner or later.”
Enlarge image John Goodman and attorneys look over his wrecked Bentley, after jurors had finished looking at both cars involved in the deadly crash, entered as part of evidence in the Goodman's DUI Manslaughter trial on Thursday, March, 15, 2012, in West Palm Beach, FL. Goodman was convicted of vehicular homicide from a February 2010 crash that killed 23-year-old Scott Wilson. Photographer: Lannis Waters/The Palm Beach Post/AP Photo
Enlarge image Virginia Governor Bob McDonnell on April 4 signed legislation permitting asset-protection trusts in his state, bringing the number of states offering them to 13 including Delaware, Nevada, New Hampshire and Alaska. Photographer: Mandel Ngan/AFP/Getty Images
Wealthier households use the asset-protection trusts, umbrella insurance and holding assets through special corporations to shield their legacies if they’re sued, according to estate planners such as Osborne. Trusts are “far and away the most popular strategy,” said Joshua Husbands, a partner with Holland & Knight LLP in Portland, Oregon.
Trusts often are funded with liquid assets such as stocks and bonds, and may be appealing because individuals who establish them may also take distributions if they need to, while the assets are generally out-of-reach from future creditors. They won’t offer protection if a defendant creates a trust after a potential claim has already arisen.
Directors and officers increasingly are being named in investor lawsuits. About 64 percent of federal securities class- action suits filed in 2011 named board members as defendants, compared with about 35 percent in 2008, according to New York- based PricewaterhouseCoopers LLP. Asset-protection trusts are sometimes used to supplement their liability coverage, also called directors and officers insurance.
Directors Sued A California pension fund sued more than two dozen current and former directors and officers of Wal-Mart Stores Inc. (WMT) on May 3, alleging the company covered up the results of an internal bribery probe. Wal-Mart takes its responsibilities to shareholders seriously and has been investigating the issues raised by the lawsuit, said David Tovar, a company spokesman.
The Federal Deposit Insurance Corp. has authorized lawsuits against 176 directors and officers for their roles in bank failures, this year through May 15, placing the FDIC on track to surpass the 264 individuals it named last year.
Directors and officers liability insurance generally covers defense costs against lawsuits and protects up to the policy limit for awards against a company’s or nonprofit’s key current and former individuals, said Evan Rosenberg, senior vice president of Chubb Corp. (CB) Policies vary, and some companies may buy as much as $500 million or more in coverage, he said.
Virginia Governor Bob McDonnell on April 4 signed legislation permitting asset-protection trusts in his state, bringing the number of states offering them to 13, including Delaware, Nevada, New Hampshire and Alaska.
Residents of states that don’t permit them, such as New York and New Jersey, may set up the trusts by using a trustee in a state that does recognize them.
50 Percent Limit Clients generally shouldn’t put more than 50 percent of their net worth into the trusts, because drawing income should be considered a last resort, said Daniel Lindley, president of the Northern Trust Company of Delaware, a unit of Chicago-based Northern Trust Corp. (NTRS)
For trusts based in Delaware or Alaska, assets also may be protected from divorce proceedings provided a trust was established before a couple married, said Gideon Rothschild, a partner with Moses & Singer LLP in New York.
Individuals who are no longer in a high-risk position may be able to liquidate the structure when they retire or change fields, Rothschild said. It’s generally up to the trustee’s discretion, he said.
Retitling Assets Starting an asset-protection trust in the U.S. may cost from $5,000 to $10,000 in initial fees, plus about $3,000 to $5,000 per year, said Joe McDonald, cofounder of the Concord Trust Company, based in Concord, New Hampshire. Initial costs depend on the attorney’s rate and continuing costs generally vary with the level of assets in the trust, he said.
For a married couple, if one spouse is more vulnerable to potential claims than the other, it may make sense to retitle assets so that they’re solely owned by the other spouse, Husbands said. This situation may arise in instances such as when one spouse is a doctor or serves on a board.
“You have to do it with forethought, and while things are still above board,” meaning before any incident that could trigger a claim, Husbands said. “You also run the risk that if you get divorced, you’ve given everything away.”
Affluent individuals should be sure they take advantage of all available federal and state exemptions for their assets, such as a federal exemption that generally insulates employer- sponsored retirement plans like 401(k)s from creditors’ claims, McDonald said.
Unlimited Exemptions Some states, including Florida and Texas, generally offer unlimited exemptions for primary residences. Others, including Oregon, put a dollar-value cap on the exemption for a home. New Hampshire and Texas generally protect the cash value of life- insurance policies. Maine has an exemption for fishing boats.
Families may consider putting additional assets into multimember limited-liability companies that are owned together by family members, said Mark Haranzo, a partner with Withers Bergman LLP in New York. Taking over one family member’s partial interest in such a company may be an unappealing option for creditors because they generally have no control and limited rights to draw income. That means the strategy can be used as leverage for negotiating a settlement should a future claim arise, Haranzo said.
About 38 percent of affluent families said they feel they’re more likely to be sued in the aftermath of the 2008 to 2009 economic and financial crisis, according to a study of households with $5 million or more in investable assets released in March by Ace Private Risk Services, a unit of Zurich-based insurer Ace Ltd. (ACE) About 82 percent of respondents said their wealth makes them vulnerable to liability lawsuits.
Timing Is Everything “High-net-worth families are acutely aware of the fact that they have the proverbial target on their back,” Husbands said
_________________________________________________________________
NOW, LIFE INSURANCE COMPANIES CAN LEVERAGE THEIR INVESTMENTS AS THEY EXPAND INTO THIRD WORLD COUNTRIES WITH MARKET RISKS THAT ARE EXTREMELY HIGH......LIFE INSURANCE TODAY MAY BE LOST JUST LIKE YOUR PENSION! THIS IS THIRD WAY FREE MARKET WORKING FOR YOU@!
MetLife to Expand in Emerging Markets, Pare Annuities
By Zachary Tracer - May 23, 2012 12:44 PM ET Bloomberg Financial
MetLife Inc. (MET) will expand in emerging markets, add sales of accident-and-health protection in the U.S. and scale back from capital-intensive products such as variable annuities as it works to reverse a stock slump.
The largest U.S. life insurer plans to raise return on equity to between 12 percent and 14 percent by 2016, from 10.3 percent in 2011, it said today in a statement. New York-based MetLife is targeting $600 million in expense savings and an increase in its emerging-markets business to 20 percent or more of operating earnings from a projected 14 percent this year.
Chief Executive Officer Steven Kandarian is reducing variable annuity sales to limit the risk of equity-market declines and exiting banking to reduce U.S. oversight. The insurer has dropped about 30 percent in the past year as the Federal Reserve rejected Kandarian’s plans for share repurchases and a dividend increase as part of its review of how the largest companies in banking would withstand another financial crisis.
“The riskier your overall portfolio is perceived or is, either one, whether it is or perceived, it still goes through to your stock price,” Kandarian said today in a presentation to investors. “The goal is to shift toward a more predictable earnings stream and stronger free cash flows.”
MetLife slipped 90 cents, or 2.9 percent, to $30.17 at 12:16 p.m. in New York. The stock is down 3.2 percent since Dec. 31, compared with the 8.7 percent slide at Prudential Financial Inc. (PRU), the No. 2 U.S. life insurer. Newark, New Jersey-based Prudential said at its investor day yesterday that it is targeting a 13 percent return on equity for next year.
U.S. Cost Cuts In the U.S., Kandarian will introduce accident and health products, the company said in the statement. MetLife may also expand vision coverage and is developing a direct sales business as more people are expected to buy life insurance online.
About 60 percent of the cost reductions will be in the U.S., and the unit focusing on sales to individuals “will have the largest portion of this contribution,” said William Wheeler, president of the Americas. “We do expect our mature businesses to shoulder most of the impact.”
Wheeler highlighted the company’s leadership in lines of coverage sold through employers, such as disability and dental policies, and said MetLife may be able to increase prices for some segments. These businesses are attractive because they have less risk tied to capital markets, the company said.
Turkey, Brazil MetLife may acquire businesses in developing countries including Russia, Turkey, Brazil and China, where the firm projects increasing demand as the number of middle-class consumers grows, according to a slide presentation today.
MetLife may consider acquisitions that cost about $2 billion to $3 billion, Kandarian said. Regulators who blocked buybacks and dividends haven’t told the company it can’t pursue deals, he added.
“If we’re able to pick up a property in Southeast Asia at a price that makes sense to us, that can be accretive in a relatively short period of time, we’ll certainly do that,” Kandarian said.
MetLife compares deals against buybacks, so the share price “is not a positive” as the company evaluates possible acquisitions, he said.
“I don’t think the market really fully takes into account our presence, MetLife’s presence, in emerging markets,” Kandarian said. “This is a market that’s growing rapidly.”
MetLife purchased American Life Insurance Co. from bailed- out American International Group Inc. (AIG) in 2010 to expand beyond the U.S. The unit had about 12,500 employees and operations in more than 50 countries at the time.
‘More Complex’ Kandarian, promoted to CEO last year after serving as chief investment officer, worked on a previous review that found about $700 million in annual savings as the company cut jobs.
“We worked hard back in 2008 on streamlining things,” Kandarian said in February. “We now have Alico, which makes more complex something we just simplified.”
MetLife grew in Japan, Australia and the U.K. with the $11.7 billion purchase of Travelers Life & Annuity from Citigroup Inc. (C) in 2005. The company bought Mexico’s biggest life insurer, Aseguradora Hidalgo SA, for about $962 million in 2002, and entered the Brazil dental market with a 2008 acquisition. MetLife said in December that revenue from emerging markets will grow by about 20 percent a year through 2015.
Regulatory Review Kandarian declined to give an update on efforts to escape federal oversight by getting rid of bank assets, including the planned sale of deposits to General Electric Co. (GE) The insurer has until mid-June to submit a revised Comprehensive Capital Analysis and Review plan to the Federal Reserve, he said.
Last month he said he couldn’t restate a previous projection that the insurer would jettison its bank status by June 30.
“I don’t have any greater visibility today than I did at the earnings-call,” Kandarian said at the investor conference. “We have done everything on our side. I believe everything that GE could do has been done on their side, and we’re waiting for the regulatory bodies.”
To contact the reporters on this story: Zachary Tracer in New York at ztracer1@bloomberg.net
The wealthy on the other hand have politicians working double time to solidify their fraudulent fortunes. I spoke of dynasty building plans......hiding estates from estate taxes and now an insurance that shields all that wealth from legal claims. They commit a crime and are sued hundreds of millions.....the insurance company will pay. This has been the case for corporate executives but now they have extended it to family wealth. It all happens in friendly Third Way states like Biden's Delaware and Harry Reid's Nevada.
We are already starting to hear the rumblings of pundits warning of recession if you let those Bush Tax Cuts expire.....this economic downturn will go on for years, don't let them use this as continued reason for falling to end tax cuts. They expire automatically....Republicans have nothing to do with it. The expiration of these cuts alone will fulfill the $4 trillion in deficit reduction politicians want with no need to cut entitlements, poverty programs, or education. THE AMOUNT YOUR TAX BILL WILL GO UP IS SMALL COMPARED WITH THE WEALTHY....THAT'S WHY THEY FIGHT IT. IT IS A WIN WIN FOR PROGRESSIVES IF BUSH TAX CUTS ARE LET TO EXPIRE...DO NOT LET THEM TELL YOU OTHERWISE! SHOUT OUT----END BUSH TAX CUTS TO AVOID ENTITLEMENT AND POVERTY CUTS!
Wealthy Americans Turn to Trusts to Shield Assets
By Elizabeth Ody - May 23, 2012 12:01 AM ET Bloomberg Financial
Executive-liability insurance is often the first line of financial defense for executives and directors caught up in litigation such as investor lawsuits. For others without such coverage, asset-protection trusts are the way many insulate their wealth from claims.
“For a businessperson who’s in a competitive environment in which you see a lot of business litigation, I would say it’s prudent planning,” said Duncan Osborne, a partner with Osborne, Helman, Knebel & Deleery LLP in Austin, Texas. “That lawsuit’s coming sooner or later.”
Enlarge image John Goodman and attorneys look over his wrecked Bentley, after jurors had finished looking at both cars involved in the deadly crash, entered as part of evidence in the Goodman's DUI Manslaughter trial on Thursday, March, 15, 2012, in West Palm Beach, FL. Goodman was convicted of vehicular homicide from a February 2010 crash that killed 23-year-old Scott Wilson. Photographer: Lannis Waters/The Palm Beach Post/AP Photo
Enlarge image Virginia Governor Bob McDonnell on April 4 signed legislation permitting asset-protection trusts in his state, bringing the number of states offering them to 13 including Delaware, Nevada, New Hampshire and Alaska. Photographer: Mandel Ngan/AFP/Getty Images
Wealthier households use the asset-protection trusts, umbrella insurance and holding assets through special corporations to shield their legacies if they’re sued, according to estate planners such as Osborne. Trusts are “far and away the most popular strategy,” said Joshua Husbands, a partner with Holland & Knight LLP in Portland, Oregon.
Trusts often are funded with liquid assets such as stocks and bonds, and may be appealing because individuals who establish them may also take distributions if they need to, while the assets are generally out-of-reach from future creditors. They won’t offer protection if a defendant creates a trust after a potential claim has already arisen.
Directors and officers increasingly are being named in investor lawsuits. About 64 percent of federal securities class- action suits filed in 2011 named board members as defendants, compared with about 35 percent in 2008, according to New York- based PricewaterhouseCoopers LLP. Asset-protection trusts are sometimes used to supplement their liability coverage, also called directors and officers insurance.
Directors Sued A California pension fund sued more than two dozen current and former directors and officers of Wal-Mart Stores Inc. (WMT) on May 3, alleging the company covered up the results of an internal bribery probe. Wal-Mart takes its responsibilities to shareholders seriously and has been investigating the issues raised by the lawsuit, said David Tovar, a company spokesman.
The Federal Deposit Insurance Corp. has authorized lawsuits against 176 directors and officers for their roles in bank failures, this year through May 15, placing the FDIC on track to surpass the 264 individuals it named last year.
Directors and officers liability insurance generally covers defense costs against lawsuits and protects up to the policy limit for awards against a company’s or nonprofit’s key current and former individuals, said Evan Rosenberg, senior vice president of Chubb Corp. (CB) Policies vary, and some companies may buy as much as $500 million or more in coverage, he said.
Virginia Governor Bob McDonnell on April 4 signed legislation permitting asset-protection trusts in his state, bringing the number of states offering them to 13, including Delaware, Nevada, New Hampshire and Alaska.
Residents of states that don’t permit them, such as New York and New Jersey, may set up the trusts by using a trustee in a state that does recognize them.
50 Percent Limit Clients generally shouldn’t put more than 50 percent of their net worth into the trusts, because drawing income should be considered a last resort, said Daniel Lindley, president of the Northern Trust Company of Delaware, a unit of Chicago-based Northern Trust Corp. (NTRS)
For trusts based in Delaware or Alaska, assets also may be protected from divorce proceedings provided a trust was established before a couple married, said Gideon Rothschild, a partner with Moses & Singer LLP in New York.
Individuals who are no longer in a high-risk position may be able to liquidate the structure when they retire or change fields, Rothschild said. It’s generally up to the trustee’s discretion, he said.
Retitling Assets Starting an asset-protection trust in the U.S. may cost from $5,000 to $10,000 in initial fees, plus about $3,000 to $5,000 per year, said Joe McDonald, cofounder of the Concord Trust Company, based in Concord, New Hampshire. Initial costs depend on the attorney’s rate and continuing costs generally vary with the level of assets in the trust, he said.
For a married couple, if one spouse is more vulnerable to potential claims than the other, it may make sense to retitle assets so that they’re solely owned by the other spouse, Husbands said. This situation may arise in instances such as when one spouse is a doctor or serves on a board.
“You have to do it with forethought, and while things are still above board,” meaning before any incident that could trigger a claim, Husbands said. “You also run the risk that if you get divorced, you’ve given everything away.”
Affluent individuals should be sure they take advantage of all available federal and state exemptions for their assets, such as a federal exemption that generally insulates employer- sponsored retirement plans like 401(k)s from creditors’ claims, McDonald said.
Unlimited Exemptions Some states, including Florida and Texas, generally offer unlimited exemptions for primary residences. Others, including Oregon, put a dollar-value cap on the exemption for a home. New Hampshire and Texas generally protect the cash value of life- insurance policies. Maine has an exemption for fishing boats.
Families may consider putting additional assets into multimember limited-liability companies that are owned together by family members, said Mark Haranzo, a partner with Withers Bergman LLP in New York. Taking over one family member’s partial interest in such a company may be an unappealing option for creditors because they generally have no control and limited rights to draw income. That means the strategy can be used as leverage for negotiating a settlement should a future claim arise, Haranzo said.
About 38 percent of affluent families said they feel they’re more likely to be sued in the aftermath of the 2008 to 2009 economic and financial crisis, according to a study of households with $5 million or more in investable assets released in March by Ace Private Risk Services, a unit of Zurich-based insurer Ace Ltd. (ACE) About 82 percent of respondents said their wealth makes them vulnerable to liability lawsuits.
Timing Is Everything “High-net-worth families are acutely aware of the fact that they have the proverbial target on their back,” Husbands said
_________________________________________________________________
NOW, LIFE INSURANCE COMPANIES CAN LEVERAGE THEIR INVESTMENTS AS THEY EXPAND INTO THIRD WORLD COUNTRIES WITH MARKET RISKS THAT ARE EXTREMELY HIGH......LIFE INSURANCE TODAY MAY BE LOST JUST LIKE YOUR PENSION! THIS IS THIRD WAY FREE MARKET WORKING FOR YOU@!
MetLife to Expand in Emerging Markets, Pare Annuities
By Zachary Tracer - May 23, 2012 12:44 PM ET Bloomberg Financial
MetLife Inc. (MET) will expand in emerging markets, add sales of accident-and-health protection in the U.S. and scale back from capital-intensive products such as variable annuities as it works to reverse a stock slump.
The largest U.S. life insurer plans to raise return on equity to between 12 percent and 14 percent by 2016, from 10.3 percent in 2011, it said today in a statement. New York-based MetLife is targeting $600 million in expense savings and an increase in its emerging-markets business to 20 percent or more of operating earnings from a projected 14 percent this year.
Chief Executive Officer Steven Kandarian is reducing variable annuity sales to limit the risk of equity-market declines and exiting banking to reduce U.S. oversight. The insurer has dropped about 30 percent in the past year as the Federal Reserve rejected Kandarian’s plans for share repurchases and a dividend increase as part of its review of how the largest companies in banking would withstand another financial crisis.
“The riskier your overall portfolio is perceived or is, either one, whether it is or perceived, it still goes through to your stock price,” Kandarian said today in a presentation to investors. “The goal is to shift toward a more predictable earnings stream and stronger free cash flows.”
MetLife slipped 90 cents, or 2.9 percent, to $30.17 at 12:16 p.m. in New York. The stock is down 3.2 percent since Dec. 31, compared with the 8.7 percent slide at Prudential Financial Inc. (PRU), the No. 2 U.S. life insurer. Newark, New Jersey-based Prudential said at its investor day yesterday that it is targeting a 13 percent return on equity for next year.
U.S. Cost Cuts In the U.S., Kandarian will introduce accident and health products, the company said in the statement. MetLife may also expand vision coverage and is developing a direct sales business as more people are expected to buy life insurance online.
About 60 percent of the cost reductions will be in the U.S., and the unit focusing on sales to individuals “will have the largest portion of this contribution,” said William Wheeler, president of the Americas. “We do expect our mature businesses to shoulder most of the impact.”
Wheeler highlighted the company’s leadership in lines of coverage sold through employers, such as disability and dental policies, and said MetLife may be able to increase prices for some segments. These businesses are attractive because they have less risk tied to capital markets, the company said.
Turkey, Brazil MetLife may acquire businesses in developing countries including Russia, Turkey, Brazil and China, where the firm projects increasing demand as the number of middle-class consumers grows, according to a slide presentation today.
MetLife may consider acquisitions that cost about $2 billion to $3 billion, Kandarian said. Regulators who blocked buybacks and dividends haven’t told the company it can’t pursue deals, he added.
“If we’re able to pick up a property in Southeast Asia at a price that makes sense to us, that can be accretive in a relatively short period of time, we’ll certainly do that,” Kandarian said.
MetLife compares deals against buybacks, so the share price “is not a positive” as the company evaluates possible acquisitions, he said.
“I don’t think the market really fully takes into account our presence, MetLife’s presence, in emerging markets,” Kandarian said. “This is a market that’s growing rapidly.”
MetLife purchased American Life Insurance Co. from bailed- out American International Group Inc. (AIG) in 2010 to expand beyond the U.S. The unit had about 12,500 employees and operations in more than 50 countries at the time.
‘More Complex’ Kandarian, promoted to CEO last year after serving as chief investment officer, worked on a previous review that found about $700 million in annual savings as the company cut jobs.
“We worked hard back in 2008 on streamlining things,” Kandarian said in February. “We now have Alico, which makes more complex something we just simplified.”
MetLife grew in Japan, Australia and the U.K. with the $11.7 billion purchase of Travelers Life & Annuity from Citigroup Inc. (C) in 2005. The company bought Mexico’s biggest life insurer, Aseguradora Hidalgo SA, for about $962 million in 2002, and entered the Brazil dental market with a 2008 acquisition. MetLife said in December that revenue from emerging markets will grow by about 20 percent a year through 2015.
Regulatory Review Kandarian declined to give an update on efforts to escape federal oversight by getting rid of bank assets, including the planned sale of deposits to General Electric Co. (GE) The insurer has until mid-June to submit a revised Comprehensive Capital Analysis and Review plan to the Federal Reserve, he said.
Last month he said he couldn’t restate a previous projection that the insurer would jettison its bank status by June 30.
“I don’t have any greater visibility today than I did at the earnings-call,” Kandarian said at the investor conference. “We have done everything on our side. I believe everything that GE could do has been done on their side, and we’re waiting for the regulatory bodies.”
To contact the reporters on this story: Zachary Tracer in New York at ztracer1@bloomberg.net
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