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So my question is what does a land trust provide above and beyond the anonymity of a properly structured LLC? The biggest challenge with land trusts and I’m obviously not an attorney, I’m not handsome enough to be an attorney. Everything I understand about land trusts, which is a lot is that there really not that much better at anonymity than an LLC ever would be. In fact, in the state of Arizona, we don’t get really any anonymity for utilizing a land trust. So I don’t use Land Trust here. No, thanks. No, thanks. Yeah, no thanks.
In fact, in order for me to get a title policy here in the state of Arizona, my Land Trust has to name the beneficiary of that land trust. So there’s no reason for me to use land trust. So as I unraveled that and found all these things out over the years, I was like, Why does anybody really ever use a land trust, especially when you can use like, you can put an LLC in a state like, John Sinclair could do an LLC in Arizona, have it owned by a trust, full anonymity, and then you could have your trust on multiple LLC. So in that situation, you wouldn’t need a land trust? Same thing in any state, really.
So my question is, what does a land trust provide above and beyond the anonymity of a properly structured LLC? From what I’m understanding? It just provides an umbrella that the other LLC will operate underneath? Shawn, what are your what’s your handsome? I don’t know Florida law, but Oh, did you know he was in Florida? By the way? Did you mention that Todd? Yes, sir. Okay, because this is an interesting thing. Florida attorneys and title companies love land trusts.
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And I didn’t hear you say, Florida, but I just assumed you were in Florida, because every time I get a question about a land trust, it’s somebody in Florida, it has been here. I don’t know Florida law, but at least under Arizona law, which I believe is consistent with the common law throughout the nation, your LLC creates a corporate veil, the only thing that anonymity does for you here in Arizona is it’s preventative and deterrent, you know, if somebody looks at a transaction, that pace was involved in and thinks they were wrong.
If they don’t know and can’t figure out from the public records, that pace is even involved, then they’re not likely to do anything because they’re like, Well, if we do something, how much are we going to have? It’s just some random investor out there that probably doesn’t have anything, but then they see pace. And it’s like, oh, we can leverage something here and receive a settlement even if our claims flaky, just because pace has assets and wants to protect himself. Right. That’s what anonymity does, it’s a deterrent. That doesn’t mean though, that veil doesn’t provide protection that the corporate veil does not provide protection.
The corporate veil provides protection, whether you have anonymity or not all anonymity is is a deterrent from lawsuits. You’re hoping that they look at it and just say, well, we don’t know who’s behind it. So it’s not worth pursuing it because probably don’t have anything. On the flip side, they may look and say, Wait a minute, they plan this thing in such a way that we can’t figure it out. They must have assets.Oh, yeah, they’re smart enough and they have enough capital to hire good attorneys that should not you know, correct there. But nevertheless, it anonymity is no greater protection than your corporate veil. It’s just a deterrent.
Here’s the thing about Florida, okay. There’s two guys in Florida. They’re big educators. They’ve been educating for over 45 years with creative finance, the money that they made in their life, the most out of all their revenue streams. Do you know what was the number one profitable revenue stream? It was selling land trusts. So they had a partnership with an attorney who was setting up land trusts. So they went around to title companies and Rheas and real estate meetups and all this kind of stuff for 30 years in Florida.
Still, he lives in Florida. He still lives in Florida, still teaching land trusts, fight land trusts. So there’s a lot of title companies and a lot of people that love Land Trust, and it became a thing. And so when I jumped into business, and I was doing creative stuff, seven, eight years ago, it was something I had to educate myself on for a whole year to find out that a land trust anyone will know my name is, in most cases, is a waste of time.