Mr. Bustillos wrote this letter in response to the following article:

"Shielding assets can be a dirty game"
Article by Jane Bryant Quinn on March 16, 1997

Dear Editor:

Apparently, writing about Asset Protection can be a dirty game. The advice that was given out by Jane Bryant Quinn in her March 16, 1997, article is both berating and uninformed.

Where does Ms. Quinn get the idea that "a lot of wealthy people don't want to pay their debts"? People are wealthy because the DO pay their debts, and, thus encourage others to do business with them.

Asset protection is every American's right. I am an attorney practicing in the field of asset protection. There is no law that I know of which says we have to place our valuables on the side of the road where every Tom, Dick and Harry can see them and take them. Wise men and women everywhere try to protect the money they have worked hard to accumulate.

Asset protection plans have always been a part of the American business fabric. Corporations are asset protection devices. Limited partnerships are asset protection devices. Trusts for Minors are asset protection devices. Catastrophic Illness Trusts are asset protection devices. Even community property is an asset protection device. Does Ms. Quinn mean to say that those plans are "dirty" because somebody has misused them? By using a living trust, you can save over $18,000 in probate costs of you die owning a $300,000 home. Is the public "dirty" for using a living trust?

The real smudginess of Ms. Quinn's article was the way she misguided the public. People depend on her column for advice on financial matter. Her March 16th article has failed her readers. First, she has described how an unscrupulous few can misuse a system; and then she failed to point out how it is that the law catches up. Second, and worse, she has given the impression that all the rest of us should stay away from asset protection plans, or be viewed as tax evaders, deadbeats or frauds. Those of us who set up Asset Protection Plans are not working to "evade" taxes. We spend many hours making sure that our plans comply with the tax code. We don't want our clients criminally charged with felony tax evasion. But, we do want our clients to get the full benefit of the tax code.

Asset protection plans do not "duck out" on legitimate debts. If a debtor tells a creditor that he needs a $20,000 loan to be secured by his $50,000 a year income plus a $100,000 house in trust, the creditor is going to be able to use the trust assets to satisfy the loan. The debtor's trust asset is not going to be able to "duck out" of that legitimate debt. On the other hand, if the debtor tells the creditor that he needs a $20,000 loan to be secured by his $50,000 a year income, and creditor grants the debtor a $20,000 loan, it is because creditor made a business decision that $50,000 was sufficient collateral. Any other assets owned by the debtor are not legitimately relevant to the debt.

Asset protection plans do not perpetrate "fraud." Since 1571, our American common law system has refused to permit a debtor to defraud creditors through the use of a trust, limited partnership, corporation or any other asset protection device. The law prevents such fraud through a concept called "piercing the veil."

Everyone is entitled to use the law. In the United States, laws aren't just for the rich or famous. The State of California says we, the people, can use a trust or a limited liability company to protect our property. Ms. Quinn should not besmirch our citizens when a asset protection device is used.

Let's set the record straight.

Yours truly,

LUIS MICHAEL BUSTILLOS
Attorney at Law