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We have run an articles series on Florida asset protection provided by the homestead exemption.  Those articles addressed the homestead exemption in the context of creditor claims.  In other words, they discussed how the homestead exemption protects property that is being attacked outside of bankruptcy.  In a bankruptcy proceeding, homestead laws provide asset protection but not nearly to the same degree.

Asset Protection Shoppers

Remember WorldCom?  To me, there is no better symbol of the tech bubble.  WorldCom, a company based in Mississippi, actually provided a service and was profitable.  But the executives became greedy.  In order to manipulate WorldCom’s stock price, the executives engaged in accounting fraud and raked in millions for themselves at the expense of shareholders, who were left with literally nothing after the telecommunications giant filed bankruptcy.

Guess where nearly every executive involved in the scandal owned a home?  You guessed it . . . Florida.  Why?  Prior to 2005, the homestead exemption allowed in bankruptcy was nearly unlimited.  That meant that as long as the executives put their ill-gotten gains into a home that they occupied in Florida, their money was protected.

In fact, John Porters, the Chairman of WorldCom, was himself forced to file personal bankruptcy.  Although Mr. Porters was never charged with any crimes in conjunction with the fraud at WorldCom, he ended up owing more than $70 million when the stock collapsed, much of it to the I.R.S.  At the end of the day, however, Mr. Porters was able to keep about $17 million dollars, all of it from his Florida homestead.

In 2005, partly as a result of stories like WorldCom’s, Congress amended bankruptcy legislation.  Today, a Florida homestead that is less than 40 months old is only entitled to an exemption of $125,000.  The $125,000 cap is absolute if a bankruptcy debtor owes money for securities fraud or fiduciary fraud committed in the previous five years.  There are lots of other rules and exceptions that apply.

While most people agree that these types of “criminal activity” exceptions are good, especially since homestead laws were originally intended to provide farmers with a form of asset protection, they affect everyone who has lived in Florida for less than 40 months.  That means an alternative form of asset protection is needed during the interim.  Everyone needs to take action now to protect their assets.  Between the 2005 revisions to the bankruptcy laws and rules on fraudulent conveyances, can you really afford to wait on contacting an asset protection attorney?

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Pashmina Lalchandani

CEO & Co-Founder, Bar & Cocoa / Owner, Flow Simple
December 9, 2010, Douglass was a client of Pashmina’s

I’ve known Doug in many contexts, as a friend, as a client and as a business partner and he impresses me on all levels. He’s dependable, smart, generous and I wouldn’t hesitate recommending him and his law firm to anyone.
He’s the best and most ethical lawyers providing asset protection with rock solid strategies to give you peace of mind about your wealth. Straight forward, and straight talk. Doug is exactly the lawyer I want on my side. If I send someone to Doug, I know they’ll thank me for it!

Social & Solar Entrepreneur, Pan Afrikan Theorist, Translator/Interpreter,
Founder & Visionary Leader @ Afrikanpride.
March 12, 2011, Marlon E. D. J. worked with Douglass but at different companies

Doug is one of the most powerful thinker i have came across. During the short time that i have known Doug he has been a great source of inspiration. He has a simplistic yet effective and accurate way to analyze anything you bring to his attention, and then by asking you key questions he gets you to see the light at the end of the tunnel. Besides being extremely bright, he is a genuine and caring individual which is why I feel fortunate to know him. I can say without a doubt that he his the person you would want to talk to if you were in need of a person with his expertise.
Most of the lawyers out there will probably meet your needs, but if you are looking for someone to exceed your expectations and give you that wow factor, look no more he is the person for the job.

Patricia Salter

Associate Dentist at Smileology
December 1, 2010, Patricia was a client of Douglass’

I have been a client of Douglas Lodmell’s since 2001. My main concern was asset protection in this litigious society. I can sleep alot better at night knowing I have the instruments in place to protect the fruits of my labor, and that they will not end up in the hands of a slick trial attorney.

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