An asset protection trust is any trust formed for a term of years in a foreign jurisdiction which:

1. either does not recognize or imposes significant barriers to the recognition of United States judgments,
2. has enacted a Statute of Elizabeth override provision, and
3. imposes strict procedural barriers to actions brought in that jurisdiction attacking trusts settled in that jurisdiction.

Normally, at least if the settlor of this trust is a United States resident, the trust will also:

4. be irrevocable for a period of years,

5. have beneficiaries other than the settlor, and

6. position the settlor as a contingent remainderman.

At the termination of the trust all undistributed trust assets, including the original res and all income earned thereon, is returned to the settlor. Distributions are normally discretionary with the trustee whose actions will be guided by a Committee of Trust Advisors or a Protector. In the event of a creditor attack threatening the assets in any way, the termination of the trust will be delayed until the assets can be safely distributed to the settlor or the beneficiaries of his choice. In the event that the trust or its assets are subject to aggressive attack in the foreign jurisdiction, the situs of the trust will be changed (perhaps automatically) to a new and undisclosed jurisdiction. A properly settled asset protection trust is very difficult to penetrate.