by Frederick Mann
© Copyright 1993, Terra Libra Holdings, ALL RIGHTS RESERVED
PROPSPER INTERNATIONAL LEAGUE LTD. (PILL)
Edited by Frederick Mann
The information below has been extracted and adapted from Money Masters Seminars' newsletter by Melissa Foster, YOUR MONEY - YOUR LIFE, Vol. 2, Issue 7, March 7, 1999 http://www.pecorp.nu/moneymasters/ymyl0207.htm
Offshore entities with a debit card
I would like to discuss a specific type of entity with which we have had personal experience, and tell you how it operates.
Any entity -- a trust, LLC, IBC, etc. -- can hold any kind of asset -- real estate, brokerage accounts, bank accounts, automobiles, etc. Some are more appropriate for some assets than others. People often call to ask us about "those entities where you get a debit card" and they are usually referring to an entity domiciled in another country that holds a bank account, with the funds in that account accessible through a debit card at any bank or ATM located around the world.
One such organization that sets up entities of that type is known most commonly by its acronym "PILL" and while I have never used them personally, I must have worked with over a hundred people in the last decade who have used this organization successfully, regularly, and without any problems.
PILL sets up entities that are called "bearer trusts," which means that the bearer of the certificates or instruments is the one who controls the assets held by that entity. To put that in plain English, the guy who has the certificate or the instrument -- such as a debit card -- is the guy who has access to what's in the trust.
Therefore, a bearer trust would not be appropriate to hold hard assets such as real estate, cars, and the like, and the certificates could be stolen and whoever had them could have access to those assets. A bearer trust also means that assets are held "in common," which means that if I lived in a house held by a bearer trust, and you lived in a house by a bearer trust - technically, the guy who controls those certificates has access to both of those houses. It's a situation rife for mistakes.
There is one situation, however, where I have seen these bearer trusts used successfully, without problems, and over long periods of time, and that is with those trusts holding bank accounts. In the cases I have seen with PILL, those bank accounts are typically established in banks outside of the U.S. or Canada. There is a foreign "grantor," a foreign "settlor," and a foreign "trustee."
Speaking from my own experience living in the United States, I can tell you that were I to be listed as any one of those -- "grantor," "settlor," or "trustee" -- I am required by law to report that on my income tax forms. [Editor: See also Fiscal Freedom.]
However, I can tell you that no one in my experience has ever been listed in the above capacities, and yet has had access to the funds in those accounts without violating U.S. law. Let me give you a "for instance" here, to give you an idea of how these entities work.
Suppose a bearer trust was established by the PILL organization. And let's suppose that entity held a bank account established in a bank in a country outside of my home country, the United States. I would not be the grantor, the settlor, or the trustee - and I can state that legally on my tax forms every year.
Let's suppose that I do, however, have access to those funds because of a business relationship established with PILL. That access would be granted via the use of a debit card -- the same kind of debit card that any bank in the U.S. gives you, that looks like a credit card and can be used in exactly the same way.
It can be used at a store like a Visa card. It can be used at an ATM machine anywhere around the world, AND you can take it to any bank and take a cash advance, just like you can on a credit card. Your own personal name is not attached ANYWHERE to it -- nor should it be legally because you are NOT the grantor, the settlor, or the trustee, as stated previously. [Editor: Usually the credit card has the name of an individual on it. You can choose that name. There's a common-law principle that you can use whatever name you like, provided you don't do so for fraudulent purposes.]
Why is this important? At all costs, it is imperative that you not break any laws -- no amount of money in the world is worth a charge that would follow you around the rest of your life. But privacy may be important to you, and ease of access to funds is certainly important.
Traditionally, when travelling, travelers have had to use Traveler's Cheques for security, as a loss of cash while away from home can be devastating. A debit card, however, fits easily into one's wallet, is usually carried on one's person, and can be used to access funds anywhere in the world where there's an ATM machine. While I have never had a relationship with PILL myself, I have had occasion to use a debit card in many countries, and have found them to be much easier and much safer than carrying cash.
I have seen entities like this receive payments or funds from any number of things in the U.S. -- businesses, personal affairs, etc. In fact, Money Masters Seminars has written revenue share checks to numbered PILL trusts that provide the proper legal documentation. Those funds are never deposited into a U.S. bank account, but instead are sent directly to the bank account in whatever country it is established, from which the person with access to the debit card can usually access those funds within 2-4 weeks.
Who uses such an entity? People and businesses use such an entity who do business internationally and need access to those funds from anywhere in the world. Or those who, for various reasons, require more privacy in their business dealings -- an issue that will become important if the infamous "Know Your Customer" regulations take effect.
See also GENERAL FINANCIAL INDEPENDENCE FAQ <link to FAQ I'll send soon>.
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