Is a Cook Islands Trust Right for You? Begin 2025 with a Strategic Risk Assessment
In an increasingly litigious and complex world, protecting your assets and preserving your legacy requires more than just strong intentions—it demands a carefully tailored legal strategy.
As we move through 2025, individuals, entrepreneurs, and families face escalating exposure to lawsuits, regulatory scrutiny, and cross-border enforcement actions.
At Dilendorf Law Firm, we help clients navigate these risks with custom-designed estate and asset protection plans that integrate both domestic and offshore structures—when appropriate.
One such structure, the Cook Islands Trust, is often promoted as a top-tier asset protection vehicle. But it’s not a one-size-fits-all solution.
U.S. courts have spent the last 30+ years scrutinizing these trusts—collapsing them in some cases and even jailing settlors for misuse or failure to repatriate assets. That’s why a comprehensive legal risk assessment is essential before moving forward.
Our firm provides independent, court-tested guidance to determine whether a Cook Islands Trust is the right fit for your specific objectives—or whether a more effective, lower-risk domestic alternative may better serve your long-term goals.
Legacy of Security and Innovation
The Cook Islands’ asset protection laws were crafted with American clients in mind, authored by a Colorado-based attorney to provide unmatched security.
These trusts shield a wide range of assets: cash, investments, real estate, businesses, and even cryptocurrency, without requiring them to be physically located in the jurisdiction.
Privacy is paramount: trust ownership details are legally protected, ensuring confidentiality. In a groundbreaking move, the Cook Islands has also embraced blockchain technology, enabling the creation of Digital Asset Trusts.
ATTORNEYS' EXPERIENCE
ATTORNEYS' EXPERIENCE
Representing a US-based family office with setting up an asset protection trust on the Cook Islands
ATTORNEYS' EXPERIENCE
Advising a digital asset/crypto portfolio manager with setting up an asset protection structure on the Cook Islands
ATTORNEYS' EXPERIENCE
Representing a small-business owner with transferring the company’s shares to a Cook Island asset protection trust
ATTORNEYS' EXPERIENCE
Represented a foreign investor as co-counsel in connection with setting-up a Delaware Dynasty Trust for asset protection purposes and for purposes of purchasing and holding investment real estate in New York
ATTORNEYS' EXPERIENCE
Advising US founders on shifting the IP rights for a digital marketplace to a Cook Islands International Trust
In 2025, the stakes for asset protection are higher than ever. Whether you’re a business owner, investor, or individual planning for the future, a Cook Islands Trust offers a strategic shield against litigation, government overreach, and economic uncertainty.
With the experience of Dilendorf Law Firm, you can confidently navigate the complexities of offshore trusts and tailor a plan that aligns with your unique needs.
Structure
A typical Cook Islands Wealth Protection structure has several components allowing both flexibility and protection:
The Settlor establishes a Cook Islands International Trust
A Cook Islands licenced trustee serves as the Trustee
The flexible Trust structured allows the settlor and his family members to be appointed discretionary beneficiaries of the Trust
Protector can be appointed to monitor the activities of the Trustee, and can be granted absolute or veto powers or a combination of both
The Settlor can provide a letter to the Trustee detailing his/her wishes in regards to the investment and distribution of assets both during and after his/her lifetime
The Trust owns 100% of a limited liability company (“LLC”) incorporated in the Cook Islands, or other jurisdiction appropriate to the client’s circumstances
The Settlor, or his representative, is the Manager of the LLC
Assets are held and managed within the LLC or entities underlying it
Features
The Trustee is not required to be involved in the management of the LLC or its assets.
The Trustee can be granted power to remove and replace the Manager of the LLC incertain circumstances to protect the interests of the Manager and the assets under his/her control
The Manager is not personally liable for the debts, obligations or liabilities of the LLC
The Trustee is not subject to foreign judgements or forced heirship rules
Benefits
Assets held within the structure, including family businesses, can be managed and operated by the Settlor and his/her family without interference from the Trustee
The Settlor’s personal and business assets can be passed to the next generations in an orderly fashion in accordance with his/her wishes.
A change in Manager of the LLC does not give rise to fraudulent conveyance claims
Enhanced protection of assets from unforeseen creditors
Legitimate confidentiality of ultimate ownership of assets within the structure
Cook Islands Are Crypto-Friendly
Cook Islands Ministry of Finance and Economic Management (MFEM) recently modernized the trust industry by launching ‘Smart Trust platform’ built on a blockchain. This moved the traditional legal framework and processes onto a blockchain-based digital platform.
This program enables creation of Crypto Smart Asset Protection Trusts, which allows clients to manage their crypto assets and NFTs in a safe and trusted environment.
Crypto Smart Asset Protection Trusts built on the blockchain:
ensures privacy;
allows management and trading of cryptocurrencies inside placed inside of a trust;
ensures transparency between desired individuals (e.g., trust beneficiaries) but not available to the world at large;
allows transfer of digital asset ownership to the trust from any third party;
allows transfer of asset’s ownership out of the trust.
The use of Crypto Smart Asset Protection Trusts allows asset protection planners and clients access protection without the inherent problems and risks of traditional trusts. Smart Trusts efficiently combined the benefits of the traditional trust with blockchain technology, transcending limitations that existed in the ownership, management and administration of both cryptocurrency and physical assets.
Cost and Compliance
What makes a Cook Islands Trust so attractive?
A creditor who wishes to extract assets from a Cook Islands trust must re-try the case in the island nation where it was formed, in a jurisdiction known for its unfriendliness to creditors.
In addition, the plaintiffs are required to pay legal fees and court costs upfront. It is also likely that the loser of the case will pay their own legal fees as well as the winner’s.
Even if the plaintiff chooses to go down this road, and many will not have the resources, they must provide proof “beyond a reasonable doubt”, not just the “preponderance of evidence” used in the United States.
Additional Benefits:
Statute of limitations for a Cooks trust is one year.
Strength of asset protection statutes make the Cooks trust impenetrable, even by the federal government.
The laws surrounding Cook Islands trusts were written with Americans in mind and were actually written by a Colorado asset protection attorney.
The value of the assets is not disclosed, and it is against the law in the Cooks to identify who owns the trusts or to provide any information about them.
Cash and investment accounts, as well as real estate holdings, crypto and businesses, may be registered in the trusts, but unlike DAPTs none of these are required to be physically located in the Cooks.
What Assets Can Be Transferred into a Trust?
Shareholder stock from closely held corporations
Money market accounts, cash, checking and savings accounts
Cryptocurrrency, NFTs and other types of digital assets (Bitcoin, Ethereum, Stablecoins).
Partnership assets
Real estate
Life Insurance Policies
Vehicles: cars, boats, trucks, airplanes
Bank and brokerage accounts
Planning Considerations
Any offshore trust will have higher maintenance costs and setup fees, along with lengthier federal disclosures and IRS filings.
Despite being entirely ethical and legal, negative perceptions of impropriety often accompany offshore accounts. The settlor will also be required to relinquish control of the account to a foreign trustee.
As with any new trust plan, it is always wise to research the pros and cons before making any sudden moves.
The financial benefits of these trusts are numerous, including protection from lawsuits, strict confidentiality, no income taxes, no limits on the perpetuity of the trust, the flexibility to select managing trustees from one’s own country, zero impact from inheritance laws or court judgments from other countries.
Most people considering a Cook Islands trust will want to work with a trusted asset protection lawyer to determine if makes sense for their situation.
When a Cook Islands trust is selected for your asset protection plan, the legal team at Dilendorf Law Firm will provide the most strategic guidance.
