What if a tsunami was approaching would you stand on the beach and watch in fascination? What if you booked a holiday on the maiden voyage of a super cruiser, would you play cards as the ship sunk?
If you are healthy and wealthy, don’t wait for disaster to strike, act now; be wise – think, take action. The erosion of privacy is imminent don’t wait to see how it will affect you; anticipate the dangers and protect against them - now.
I worked with Peter Klimt for several years in the 1980’s, he and I were in the same tax team.
Peter has a supreme brain and a bird’s eye view of commercial transactions and tax.
He was an incredible lawyer, but an even better entrepreneur. Soon after we worked together he left the law to join the board of Dawney Day with Guy Naggar.
Our paths did not meet again until early 2008 when we bumped into each other in a restaurant in Baker Street. We swopped numbers and agreed to meet at his offices in Grosvenor Gardens close to Buckingham Palace. He had done supremely well – a self-made billionaire. A Lucien Freud hung in his office and a Tracy Emin wheelbarrow filled with rubbish and barbed wire was in one of the board rooms in the basement. His business empire owned 400 properties world-wide, several chains of restaurants, fashion houses and retail shops. Peter was riding fast and high – nothing could go wrong, he had the midas touch. Peter was the brains, Guy the business heart – a perfect combination – as long as they stayed healthy and wealthy, which is not a wise strategy. They were gambling on luck.
A few short months later, Peter’s son was involved in a car crash in France and was critically ill – Peter dropped the business in Guy’s hands to be at his son’s side. Then Lehman crashed and the banks demanded the return of their money. Dawney Day collapsed – spectacularly.
When the storm of bad luck hit, the foundations of Dawney Day were exposed, and crumbled. It did not survive without Peter at the helm and the support of the banks.
The foundations of a wealth or business empire need inspecting. Can they survive the erosion of privacy due to hit later this year. If you have not given this much thought - you need to act NOW.
By the time litigation shows on the horizon or your ship hits an iceberg – it is too late.
Do you have a trust? If not, why not? It can provide for succession, mitigate tax, protect your assets from litigation, and prevent the erosion of privacy. If you do, who is in control? Do you trust them to act in the best interests if a dispute arose or an investigation were to commence? If you have a professional trustee will they rack up expensive legal fees to protect themselves against you? If you have your own trustee company, do you have the right people as directors? Who does the administration is it efficient? Is it overly complex? Is the complexity to your advantage or does it best serve the ‘suits’?
If your structure has a Protector, a Letter of Wishes or reserved powers, it will sink when struck by litigation from a greedy government, disgruntled heir or estranged spouse. If it needs reinforcing, action needs to be taken now. Start with a simple independent review. It is no good, asking your lawyer or trustee to review your structure, they are not going to point out where the weaknesses are, it needs to be done by an independent specialist. Litigation is already on the horizon; privacy will be lost later this year. Don’t wait and see what will happen – take action - do something – now. Good luck is not a strategy and won’t last forever.
Caroline Garnham is CEO of Garnham Family Office Services – The Trust Specialists
Contact : svetlana@garnhamfos.com
020 3740 7423
Caroline’s Book ‘Who can you trust when you are Super Rich?’ can be bought on Amazon and her book ‘Winning Business from Private Clients’ can be bought direct from the website or from Svetlana.