Family Offices, Private Trust Companies and Trust Integrity Issues: Problems and Solutions

Family Offices, Private Trust Companies and Trust Integrity Issues: Problems and Solutions, in Trusts and Private Wealth Management: Developments and Directions, Richard Nolan, Tang Hang Wu and Yip Man (eds) (2021) (CUP)

Posted: 16 Aug 2019 Last revised: 23 Feb 2021

See all articles by Vincent Ooi

Vincent Ooi

Singapore Management University - School of Law; Singapore Management University - Centre for AI & Data Governance

Ee Lin Chan

Independent

Date Written: January 1, 2020

Abstract

In recent years, the increasing prevalence of ultra-high net-worth individuals (“UNWIs”) in Asia has placed the actions and choices of this new class of financial elites and their affairs in the spotlight. In this chapter, we consider the common structures used in Family Offices and Private Trust Companies (“PTCs”) used by the ultra-wealthy, focusing on the composition of their management. Several family governance issues commonly arise in practice, such as control and management, duties owed by the managers, succession planning, and how to resolve possible conflicts between beneficiaries. These must be evaluated when considering the structures to adopt. In addition, where settlors attempt to retain considerable control over the trusts (for example, through “double hatting”), trust integrity issues may arise, raising risks of trusts being treated as sham or illusory trusts. We propose several solutions to resolve the family governance and trust integrity issues highlighted in this paper, including focusing on the importance of proper administration, succession planning and employing professionals with good trusts experience to assist in management. We will also explore the use of the Singapore Variable Capital Company for family office structuring.

Keywords: Family Offices, Private Trust Companies, Private Client Law, Trusts Law, Family Governance

Suggested Citation

Ooi, Vincent and Chan, Ee Lin, Family Offices, Private Trust Companies and Trust Integrity Issues: Problems and Solutions (January 1, 2020). Family Offices, Private Trust Companies and Trust Integrity Issues: Problems and Solutions, in Trusts and Private Wealth Management: Developments and Directions, Richard Nolan, Tang Hang Wu and Yip Man (eds) (2021) (CUP), Available at SSRN: https://ssrn.com/abstract=3436563

Vincent Ooi (Contact Author)

Singapore Management University - School of Law ( email )

55 Armenian Street
Singapore, 179943
Singapore

HOME PAGE: http://vincentooi.com

Singapore Management University - Centre for AI & Data Governance ( email )

55 Armenian Street
Singapore
Singapore

Ee Lin Chan

Independent ( email )

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