Tag: Blind Trust

16 Feb

The Donald J. Trust

Noah Weisberg Beneficiary Designations, Executors and Trustees, In the News, Trustees Tags: , , , , , , 0 Comments

The media cannot get enough of President Donald Trump.  Regardless of whether you turn on the television, or pick up a newspaper, there seem to be endless articles about the policies and the decisions he has made.  As this is an estates blog, I thought it would be interesting to discuss the recent commentary regarding the Donald J. Trump Revocable Trust (the “Trust”).

Before his election, the then President-elect Donald Trump was questioned as to whether he intended to place his assets in a blind trust.

What is a blind trust? In order to answer this, I refer to a prior Hull & Hull blog which states that, “a blind trust can be thought of as an individual relinquishing control over their assets, and providing them to a trustee to manage them on their behalf. The trustee has complete discretion over how to invest the individual’s assets, with the beneficiary being provided with no information regarding how the investments are being held, and the beneficiary having no say in how the funds are managed. As the beneficiary has no idea what their funds are invested in, the theory is that they would not be inclined to enact government policy which would favour their own investments, and that they would be able to avoid a conflict of interest”.

Documents recently made available to the public provide insight into the terms of the Trust.  For instance, the assets of the Trust include liquid assets (from the sale of investments), as well as his physical and intellectual properties.  The Trustees of the Trust are the President’s eldest son, Donald Trump Jr., and Allen Weisselberg, the Trump Organisation’s chief financial officer.  Apparently, the President has the ability to revoke the trustees’ authority (I presume by saying, ‘you’re fired’) at any time. Moreover, according to the New York Times, the President will continue to receive reports on any profits/losses.

Of course, there are two views as to whether these Trust terms constitute a blind trust.  While some pundits suggest that the Trust satisfactorily distances the President from his assets, others suggest that the President has not gone far enough to absolve himself of potential conflicts of interest and is therefore not a blind trust.

Find this topic interesting?  Please consider these related Hull & Hull LLP Blogs & Podcasts:

Noah Weisberg

11 Nov

Blind Trusts – Who Controls Donald Trump’s Assets While President?

Stuart Clark In the News Tags: , , , , , , , 0 Comments

Donald Trump is president-elect of the United States of America. While the political ramifications of the surprise result of this week’s election are not yet known, there is little doubt that, as it relates to Donald Trump personally at least, his world is about to change. Donald Trump prides himself on being a successful businessman, controlling, amongst other things, a vast hotel empire that bears his name. But who controls such assets on Mr. Trump’s behalf while he is president?

Trump to place assets into blind trust
“At its most simple, a blind trust can be thought of as an individual relinquishing control over their assets, and providing them to a trustee to manage on their behalf.”

In the days following Justin Trudeau’s selection of his first cabinet in November 2015, I wrote a blog about the requirement that all of such cabinet members would need to place their investments into a blind trust.  At its most simple, a blind trust can be thought of as an individual relinquishing control over their assets, and providing them to a trustee to manage on their behalf. The trustee has complete discretion over how to invest the individual’s assets, with the beneficiary being provided with no information regarding how the investments are being held, and the beneficiary having no say in how the funds are managed. As the beneficiary has no idea what their funds are invested in, the theory is that they would not be inclined to enact government policy which would favour their own investments, and they would be able to avoid a conflict of interest.

CNBC is reporting that Mr. Trump will be placing his business interests into a blind trust while president, handing over control to his three children. CNBC has noted that Mr. Trump’s circumstance is not typical to those of other politicians who place their assets in blind trusts, noting that Mr. Trump likely knows his own investments intimately as a result of their bearing his name, such that, even in a blind trust, he would likely be able to identify them. NPR has previously reported about such difficulties, noting that it would likely be impossible for Mr. Trump to place his most valuable asset, being his own “Trump” name and brand, into a blind trust.

Thank you for reading.

Stuart Clark

13 Nov

Blind Trusts – Trust law comes to Cabinet

Stuart Clark Estate & Trust Tags: , , , , , , 0 Comments

One would be forgiven if at first instance they did not see any connection between Justin Trudeau’s recent selection of his cabinet and trust law. While most of the attention has been placed on the background of the new appointees, and of their immediate tasks at hand, there is a (however small) connection to the trust world, as many of the newly appointed Ministers and their staff are rushing to place their assets into blind trusts.

At its most simple, a blind trust can be thought of an individual relinquishing control over their assets, and providing them to a trustee to manage them on their behalf. The trustee has complete discretion over how to invest the individual’s assets, with the beneficiary being provided with no information regarding how the investments are being held, and the beneficiary having no say in how the funds are managed. As the beneficiary has no idea what their funds are invested in, the theory is that they would not be inclined to enact government policy which would favour their own investments, and that they would be able to avoid a conflict of interest.

In accordance with the federal Conflict of Interest Act, a “reporting public office holder”, which is defined as including a Minister of the Crown, a “ministerial adviser”, as well as a member of the “ministerial staff” who works on average 15 hours or more a week, must within 120 days of their appointment either sell all “controlled assets” in an arm’s length transaction, or place such assets into a blind trust. Any assets which are placed into a blind trust have annual reporting requirements, with the trustee having to file an annual report to the Conflict of Interest and Ethics Commissioner regarding the ongoing management of the blind trust.

In the context of the recent federal election, the most attention was placed on the recently elected Toronto Centre MP, Bill Morneau, who was appointed as Minister of Finance. As Mr. Morneau himself reportedly has a stock portfolio in excess of $30 million, and with his appointment as Minister of Finance would have a significant influence and impact upon the financial sector, some attention was paid to the transition of his investment portfolio likely into a blind trust. Justin Trudeau himself previously moved his own investments into a blind trust following his appointment as leader of the Liberal Party in 2013.

Stuart Clark

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