Security and Assets in the Cyprus Trust

Safety mechanisms in a Cyprus International Trust

Could a trustee run off with my assets?

It is natural to worry that a trustee might disappear with the assets of a Cyprus International Trust. In practice, this is very unlikely. Several safeguards are in place to stop it. The main ones are set out below.

• Strict legal rules. In Cyprus, trustees must follow strict rules. By law, a trustee must act in good faith and put the interests of the beneficiaries first. If a trustee breaks these duties, the consequences can be serious. They can even include criminal charges.
• Licensing and supervision. Trustees in Cyprus usually need a licence, and they are supervised. The Cyprus supervisory authority grants the licence. It checks that each trustee is honest and capable. The authority also runs regular checks and audits to make sure trustees do their job properly.
• Trust assets are kept separate. Assets you place in a Cyprus International Trust are held as a separate fund. They are kept apart from the trustee's own money. As a rule, they cannot be used to pay the trustee's personal debts. This separation gives your assets extra protection.
• A clear written agreement. The Trust Deed sets out the trustee's rights and duties. It also sets out exactly how the trust assets must be managed. This makes everything clear, and the trustee is bound to follow it.

What you can do to feel safe

• Choose your trustee with care. Pick a trustee or trust company with a good name and plenty of experience. Check their references and their licence. If you wish, our team can arrange a trustee for you through an experienced lawyer in Cyprus.
• Ask for regular reports. Ask for regular reports on the trust assets and how they are managed. Each report should give full details of the assets and of every transaction.
• Put it in writing. Make sure the key points are set out clearly in the Trust Deed. This covers the trustee's duties, how the assets are managed and shared out, and what happens if the trustee breaks the rules.
• Get professional advice. Our qualified lawyers and tax advisers can make sure every legal and tax point is handled correctly.

Summary

The fear that a trustee could simply disappear with your assets in Cyprus is, in practice, very unlikely. Strict rules, licensing and supervision, separate handling of the assets, and the professionalism of established trust companies all work together to protect you.

We are happy to assist!