Trust Corporation of the Channel Islands has recently taken up the famous injunction to “Go West, young man” and set up in business in the desert of Nevada as part of a strategy to capture demand for onshore trust services in the US.

As governments seek to crack down on offshore financial centers and bring assets back “onshore,” it makes sense for a firm such as Trust Corporation to build an onshore US presence in what is, after all, still the world’s largest economy.

“We have started to look at what our offering can provide elsewhere. In the US, they are looking for highly compliant and a more structured service that can meet the new reporting requirements,” Michael Betley, managing director at Trust Corporation, told this publication in a recent interview.

“Most Western governments are proposing changes to legislation to repatriate assets so they are more transparent and easier to tax. They are saying that it’s better to bring things back home to allow more transparency,” Betley said.

Last November, the firm created Nevada-based Regent Capital Advisors as its US business. Trust Corporation, along with its sister company, Fund Corporation,  is based in the very different locale of St Peter Port, Guernsey with a staff of around 30 people, according to its corporate website. It contains a mix of lawyers, accountants, fund administrators and tax advisors.

In a world of constant change in the trust sector, Trust Corporation has decided to expand.

“We know we need to have a presence beyond Guernsey and for us branching out into the US was the easiest next step. We are also looking at Singapore and Hong Kong. It will not be a quick turnaround, but I suspect it will be something that may happen in two or three years’ time,” said Betley.

“As a snapshot of our client base, we have a range from family office clients to pension fund arrangements, and for the sophisticated investor we have limited partnership investor clubs through to daily dealing with collective investment schemes. We are seeing private trust companies, as an area we are developing in the US,” Betley said.

Why Nevada?

Betley explained that in the US, there are five or six states where such trust business is most favored by local laws: Alaska, Nevada, New Hampshire, South Dakota and Wyoming. The firm has settled on Nevada as the place where it is locating its US business.

"We chose Nevada because it is fairly easy to get to. It is easy to reach from both the east and west coasts,” he said.

The firm may not be the biggest trust company in the business, but it has a significant number of clients, serving 94 families. In total, it oversees an aggregate of £1.6 billion ($2.5 billion) of client money.

Trust Corporation was set up by Betley and others in 2003; he has worked in the sector for 20 years, having had a previous career in private practice in the UK.

But for all the excitement of its westward adventure, Betley still wants to stress the importance of the firm’s home turf.

“The Islands [Channel Islands] are fortunate in that they are at the forefront in transparency and that is the way forward for them. Many clients and families choose the islands because they are transparent, tax-compliant and seen as legitimate,” he added.