Friday, February 20, 2009
Madoff Case - Who's Who of Whom to Sue
Release of the Madoff list is causing upheaval in the estate planning world, according to Israel Lustig, CEO of Intergenerational Wealth Preservation, Inc. (www.interwealthpres.com), a company that serves victims of Ponzi schemes and others seeking financial disaster recovery...
...Analyzing the Madoff list, Lustig points to account titles which showcase estate planning instruments that clearly failed, such as GRATs (Grantor Retained Annuity Trust), CLATs (Charitable Lead Annuity Trusts) and CRTs (Charitable Remainder Trust).
Litigators may be asking the advisors/gatekeepers some of the following questions:
·Did they disclose the risks of the estate planning structures?
·Did they plan for the contingency of a reduction in estate values?
·Did they encourage clients to avail themselves of alternate instruments or hedging techniques which may have mitigated the extent of ultimate Madoff losses realized?
·What was the objective of the GRAT: discounting the gift tax upon transfer and/or appreciating the asset out of the estate? If so, was the GRAT the only such tool available? Was it the most suitable? Was it the best tool in 2008, when Estate Tax Repeal was unsettled?
·Why didn’t the advisors factor in the possibility of decrease in asset value, when recommending GRATS in 2007 and 2008 especially the short-term GRATS?
“In fact, victims bent on recovering losses may sue any of their advisors,” Lustig states. “This includes CPAs, trusts and estates attorneys, matrimonial attorneys, corporate attorneys, and anyone who may have referred those advisors to them, such as: business managers, law firms, accounting firms, multi-family offices, private bankers, and the like. Advisors trying to use the ‘we were also duped’ defense may not find that good enough, as litigators may question why they didn’t suggest alternative tools, especially if the estate value decreased...”
NewsReleaseWire: Madoff Case - Who's Who of Whom to Sue
...Analyzing the Madoff list, Lustig points to account titles which showcase estate planning instruments that clearly failed, such as GRATs (Grantor Retained Annuity Trust), CLATs (Charitable Lead Annuity Trusts) and CRTs (Charitable Remainder Trust).
Litigators may be asking the advisors/gatekeepers some of the following questions:
·Did they disclose the risks of the estate planning structures?
·Did they plan for the contingency of a reduction in estate values?
·Did they encourage clients to avail themselves of alternate instruments or hedging techniques which may have mitigated the extent of ultimate Madoff losses realized?
·What was the objective of the GRAT: discounting the gift tax upon transfer and/or appreciating the asset out of the estate? If so, was the GRAT the only such tool available? Was it the most suitable? Was it the best tool in 2008, when Estate Tax Repeal was unsettled?
·Why didn’t the advisors factor in the possibility of decrease in asset value, when recommending GRATS in 2007 and 2008 especially the short-term GRATS?
“In fact, victims bent on recovering losses may sue any of their advisors,” Lustig states. “This includes CPAs, trusts and estates attorneys, matrimonial attorneys, corporate attorneys, and anyone who may have referred those advisors to them, such as: business managers, law firms, accounting firms, multi-family offices, private bankers, and the like. Advisors trying to use the ‘we were also duped’ defense may not find that good enough, as litigators may question why they didn’t suggest alternative tools, especially if the estate value decreased...”
NewsReleaseWire: Madoff Case - Who's Who of Whom to Sue
Permalink posted by markw @ 5:12 AM 
 |
 |  |
  |
