Peter wrote:
What’s a DA?
You should watch Fox Crime TV channel more 
An interesting additional factoid from a German aviation magazine:
One of the claims of the prosecutors against AGC seems to be that they regard the trust to share responsibility if the beneficial owner uses the plane for illegal activities.
If that legal opinion will hold true in front of the court, it will very significantly change the way trust will do their business and interact with their customers. In such a case it would be hard to imagine that there still will be a trust available for private operators as the required KYC processes, etc. will be quite cost intensive.
I think this angle has been explored a few times before. Lawyers always go for the low hanging fruit. If a skier (with €100 in the bank) kills somebody while on skis (ski manufacturer worth €100M) they will sue the latter, because they are likely to get a settlement from the ski mfg’s product liability insurer, “without admission of liability”. That’s how it always goes, if the law permits, and in the US this is often what happens. The debate gets passed around until somebody writes a cheque and then everybody buggers off to sue the next case.
Trust law is centuries old and trustee liability is a well established concept. Over the last x decades, thousands of N-regs crashed while in trust (remember many/most bizjets are trust owned even in the US, because, historically at least, most rich people didn’t want the world to know which planes they own) and this avenue would have been tried many times.
In this case it is not about liability and hence civil law but about criminal law: The prosecutor claims that (at least in this specific case) the trustee did or should have known that the plane is used in illegal operations and enabled this illegal operation by acting as trustee. Therefore it should be guilty of conspiracy to a crime.
This is a different dimension to “just” liability cases and a lot will be depending on how the judge (or finally the Supreme Court) will look at a “should have known” requirement.
Peter wrote:
The debate gets passed around until somebody writes a cheque and then everybody buggers off to sue the next case.
This case is not one of the US’ famous liability money suits, it goes much further than that.
Those accused will face possible life in prison because some of their trustees misused the planes under their responsibility.
If you see what is happening now with the insurance business in the US, where huge numbers of owners can’t get new insurance and are forced to quit flying because the insurers deem aviation a bad risk, guess what happens if we get a verdict here. My guess would be, the US trusts will rush for cover and abandon the business with N-reg airplanes in foreign hands very very fast. Which leaves all those who used this to fly flag of convenience airplanes in a huge dilemma, as many of their planes can not be easily transferred to EASA….
This is a different dimension to “just” liability cases and a lot will be depending on how the judge (or finally the Supreme Court) will look at a “should have known” requirement.
Correct – and the jurisprudence exists under “trust created for an unlawful purpose”.
The trustee has to be aware of the activity though.
Otherwise, I could hold a property in trust, with you as the beneficial owner, and get done if you run a brothel in it.
Both the Queen (the British queen, I mean) and the Church of England have owned such properties.
as many of their planes can not be easily transferred to EASA….
I am sure @mh would disagree; everything seems to be a mere formality under Part-ML.
One can argue that using the asset for an illegal activity stands to detract from its value or make it liable to forfeiture, thereby prejudicial to the trust beneficiary; as such the trustee would be found to be in violation of its fiduciary duty if his line of defense were to be “I did not know what was going on with the asset”.
Peter wrote:
The trustee has to be aware of the activity though.
I’m far away from knowing something about US trust law – but what I learned from this particular case was, that it is exactly the question if the trustee can not be held responsible if it is not aware or if there are some requirements of “having to know” and how strict are they.
In Banking these days you can not excuse yourself any longer by saying "I don’t know that these 50 Mio. that arrived each month from an unknown Colombian bank account had something to do with illegal activities – the purpose of transfer field said “consulting fees” and not “profits from drug trafficking” so how could we know?
I’m far away from knowing something about US trust law
I suspect that is true for everybody here and yes, I agree, but trust law is not the same as the KYC (know your customer) stuff in banking.
