Faking Amnesia Does Not Pay

Tommy Thompson is a treasure hunter known for locating the wreck of the SS Central America.  The ship, laden with 3 tons of gold, sank in 1857 off the coast of South Carolina killing 425 passengers.  Thompson, with the backing of 160 investors, located the wreck in 1988 and was able to bring some items to the surface.  The value of what remained underwater was reported to be $400 million making it the most valuable ship wreck discovery in history.

By the early 2000s, some of his investors sued him claiming that Thompson had sold the gold and kept the profits to himself.  An arrest warrant was issued in 2012 but he was able to stay on the lam until early 2015.  As part of a plea deal, Thompson said that some gold was in a trust account in Belize.  He now claims to have no knowledge of the location of the gold.  A federal judge has ordered him held in prison for the past 16 months for contempt of court.  The judge has asked him to sign a power of attorney so attorneys for the investors can examine trust documents.  Thompson has refused to do so.

One wonky point, one consequence, and one observation:

1.   The trust is what is known as an asset protection trust.  It is used by people to shield their assets from creditors.  There is likely a provision in the trust that prohibits the trustee from revealing anything about the trust without the consent of the grantor.  Thompson has refused to give that consent so the terms remain private.  And he remains in jail.

2.  Asset protection trusts are great in concept until a court forces the grantor to reveal the contents of the trust or to bring the assets back to the U.S.  They then became no more valuable than the paper they are written on.

3.  Salvage operations and justice both move equally slowly.

Photo Credit:  AP File Photo/Delaware Sheriff's Office
License:  Fair Use/Education

There Is Gold in the Walls! Part II

Following up on an earlier post.  A woman will officially inherit her reclusive first cousin's $7.4 million estate after a court ruled that she is his only heir.  After the man died, the estate auctioneer found $7.4 million of gold coins in his house.

Several points:

1.   When someone dies without a will, the estate does not escheat to the state.  Statutes set forth how the estate will be distributed which is generally along the lines of closest living relative.

2.  Only one first cousin?  That is a narrow family tree.

3.  Gold was a great investment for him (his cousin, really).  Apple stock would have been better. 

There Is Gold in the Walls!

After an unmarried Nevada man died, authorities discovered $7 million of gold bars and coins stashed in his house.  The man had lived alone since his mother's death in 1992.  He was apparently dead for a month before neighbors reported a smell emanating from the house.  His left no will so his first cousin, whose phone had been disconnected, will inherit the estate as his closest relative.

I am uncertain about what lessons can be learned from this story but I will suggest a few.

1.  It is always best to leave a will instead of relying on the intestacy statute to determine where assets where go after death.

2.  People should check on their "crazy neighbors" because they, instead of cousins with disconnected phones, might inherit assets at death.

3.  Living isolated and alone without visiting doctors can lead to a premature death.

4.  Gold has been an incredible investment the past several years.