There is a special trickery in pure trust scams and here is some of that trickery we can see clearly.
An excerpt from my book, “65th Octave” says “Con men rely on the public’s acceptance of authority figures. A fraud always relies on one of four fatal attractions, fear, greed, anger or lust.”
The note I received from the reader below shows how this trickery in pure trust scams works.
Pure Trust Scams Letter:
“I appreciate your earnestness in protecting people from scams. However regarding the subject of “Pure Trusts” there is considerable amounts of misinformation both pro and con. I am enclosing some court case excerpts to you to illustrate that pure trusts do exist and are valid. There have been numerous instances where so called pure trusts have been set up and sold that have been abusive structures and have basically operated as alter egos. These structures have been rightly condemned by the courts. This does not mean nor should we draw the conclusion that all pure trusts are illegal or abusive; as perhaps the IRS and others would like us to believe.
“Pure trust organizations have a very effective and useful place in estate planning and other considerations of protecting one’s property, if they are constructed properly. They do not depend on statutory law and thus have been overlooked by lawyers who have been schooled in statutory law only. Pure trusts are entities of federal law and more specifically the Constitution, whereas most business and other trust organizations are creatures of state law.
It is not necessary to go overseas to establish an effective trust program. If you would like more information on this subject you may contact me.”
The reader then included this:
TRUSTS AS LEGAL ENTITIES
Weeks vs. Sibley, D.C. 269 F 135, ” A Pure Trust is not illegal if formed for the express purpose of avoiding taxation.”
Phillips vs. Blatchford, 127 Mass 510, ” A Pure Trust is not illegal if formed for the express purpose of avoiding taxation.”
Edwards vs. Commissioner, 415 F 2d 578,582, 10th Cir.(1969), “Dignity of contract cannot be set aside because a tax benefit results either by design or accident.”
Phillips vs. Blatchford, 137 Mass 510 (1884), as stated by Mr. Justice Holmes “An association does not become illegal simply because another very like it is taxed.”
TRUSTS AS BUSINESS ENTITIES
Baker vs.. Stern, ALR 462, the Court said “It is established by legal precedence that Pure Trusts are lawful, valid business organizations.”
Burnett vs. Smith, SW 1007 (1922), the Court ruled ” Trust or trust estate is a legal entity for almost all purposes as are Common Law Trusts.”
Smith vs. Morse, 2 CA 524 , A Pure Trust is established by contract, and any law or procedure in its operation, denying or obstructing contract rights impairs contractual obligation and is, therefore violative of the United States Constitution.
Crocker vs. MacCloy, 649 US SUP 39 at 270, A Pure Trust organization, consists of a US constitutional right to contract which cannot be abridged. The agreement when executed becomes a federal organization and not under laws passed by any of
the several legislatures.
Elliot vs. Freeman, 220 US 178, A Pure Trust is not subject to legislative control. The United States Supreme Court holds that the Trust relationship comes under the realm of equity, based upon the common law, and is not subject to legislative restrictions as are corporations and other organizations created by legislative authority.
Schumann-Heink vs. Folsum, 159 NE 250 , The basis for “Common Law Trust” in this connection, is not that such organizations are creatures of common law, as distinguished from equity, but that they are created under the common law of contracts and do not depend on any statute.
Schumann-Heink vs. Folsum, 159 NE 250, If it is free from control by Certificate holders, then it is a Pure Trust.
Berry vs. McCourt, 204 NE 2d 235 (1965), A Pure Trust is a contractual relationship in Trust form.”
There was even more and IO knew that frankly speaking this was pure crap if I may be so bold. Looking at all this reminded me of
the authority figure factor and how in this instance it plays in these excerpts.
Pure Trust Scams Authority
Here this authority is enhanced by discrediting lawyers and suggesting that some lawyers are schooled in some other type of law. I asked our advisors and attorneys, Joe Cox and Leslie Share for their thoughts on this pure trust scams note.
Joe Cox firstname.lastname@example.org replied first.
“Gary, The Pure Trust is a scam. There are NO tax savings. That is how it is sold. A complete and careful reading of the cases will show that these are NOT tax cases and contain NO tax saving tricks. The trust is a contract. A contract can be a trust and so on. But, income is income and is taxed in the trust or out of the trust. You can find excerpts of cases that when taken alone can say anything. This guy could not stand the heat if he had to debate the issue. Show me the income and estate tax saving with this trust. It is not there.”
Pure Trust Scams Garbage
Tax attorney and legal advisor Leslie Share at Packman Neuwahl & Rosenberg email@example.com was even more descriptive.
“Pure garbage. A pure trust has as much viability as claiming the world is flat or the moon is made of green cheese.”
Big Pure Trust Scams Question
So how can you know who to believe? Be sure that the person who is advising you can also defend you in court. Check their credentials in defending their clients. This will be the most important time you will need them if your structure is challenged.
By the way, I know that both Leslie and Joe have had great success in defending their clients. Until next message, good business and investing!
My novel the 65th Octave looks at scam protection issues. The hero is a scam catching expert who works for big banks. The book outlines why scams work and why suckers always lose. I recommend you read the book. It has some in depth economic information but is also a fast paced, fun read.
Order the 65th Octave at GaryScott.com
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To avoid scams balance yourself in nature like this cabin at Gary and Merri Scott’s Merrily Farm where you are welcome to visit and stay. (see www.littlehorsecreek.com)