Latin American businesses have continued to strengthen their international reach. As a result, numerous successful families and individuals with roots in Latin America now have a presence in the United States. These families and individuals have a growing need for legal advice to protect their investments, plan for corporate succession within their companies and make sound estate planning decisions, among other key choices. Barbara Grayson, Willkie partner and Chair of Willkie's Private Clients Group in Chicago, gives us an insight into her extensive experience advising high net-worth individuals and families, family owned businesses, family offices and charitable organizations.
1. How do you think Willkie can serve private clients in Latin America?
In recent years, many wealthy families have moved their family offices and investments to the United States. Some of these moves are driven by concerns that they would be unfairly targeted and their assets would be seized, such as when Mexico passed a law in 2019 that made tax evasion a type of organized crime that could justify the seizure of assets — even before judges ruled on the validity of the charges. These families are attracted to the U.S.'s reputable banking system and relative political stability. Also, many Latin American families have family members who reside or own assets in the United States, which makes the U.S. tax system relevant. Willkie can help establish a family office, develop a governance succession plan for their businesses and wealth, structure estate plans that benefit U.S. persons so that U.S. estate taxes are minimized, as well as provide the legal advice related to investments, corporate transactions and dispute resolution for their business holdings.
2. What sets Willkie apart from other firms in the private clients segment?
We have an incredibly strong private clients practice, with private client lawyers in Chicago, Los Angeles and New York. As a group, we represent over 30 billionaire families and many other families with significant holdings. Our involvement with private clients and family offices is deep and broad — we counsel in the three core areas of ownership structures (trusts and estates), business interests (operating companies, investments, real estate holdings, etc.), and charitable endeavors. We have found that the intersection of ownership, business interests, and charitable endeavors requires an experienced team of lawyers with the breadth of experience necessary to implement the unique, long-term strategies involved with private wealth. At its core, our private clients practice provides tax, estate, business planning, succession planning, and charitable advisory services for high networth individuals and families, as well as the family offices, private trust companies, businesses, charitable organizations, and trusts that they establish or control. And perhaps equally important, we have a unique perspective from which to counsel our clients and help them make important judgments across all areas of engagement; we are basically the trusted advisors for our private clients, and have become a destination practice for those with extraordinary wealth. However, I think what sets us apart is the rest of Willkie. The Willkie platform is incredible, which means that in addition to traditional estate planning, we can offer our clients coordinated top-tier legal expertise when they are facing litigation, large corporate transactions, significant investments, leadership and governance transitions, or other threats to their family's holdings.
3. What are the major trends for private clients today and what is the outlook for 2022?
We talk a lot about taxes, but the most important things to many private clients are their legacy and what they are leaving behind for their descendants. That means that the succession planning and implementing sustainable governance structures is the most important work that we do. Because of our experience in representing multiple generations of families, we have seen how structures are tested many decades after they were implemented, which makes us better equipped to advise clients who are designing or updating their own succession and governance structure. Historically, and rather publicly, many fortunes were lost by the third generation, and private clients are carefully planning and designing structures in attempts to avoid that outcome. Another trend is that private clients are increasingly functioning more like private equity or venture firms and making direct investments in growing companies, which means that they need the expertise of the broader Willkie platform. I think these trends will continue in 2022 and for many years to come.
4. How does working with private clients differ from working with corporate clients?
Working with private clients involves understanding family dynamics and the human side of wealth. The work is very relationship driven. We are talking to them about the impacts of some of the most pivotal points in their family's lives – marriages, divorces, sibling and cousin relationships, births, step-children, the effects of aging, death, leadership changes in their businesses, etc. The best, most technically correct, tax and corporate planning in the world may be the wrong fit for a client's family and their governance and succession goals. For example, when a private client is selling a company, they may be more concerned that certain family members continue employment and management roles with the successor company than the absolute sale price. Other private clients may be more concerned with the treatment of their employees or the impact on their community. On the estate planning side, the question of who controls the holdings may be more important than the economics, and certain trust structures can inadvertently create family tensions between surviving spouses and descendants.
5. What is something you would like people to know about the work that attorneys do for private clients (something people don't know or understand, a misconception, etc.)?
The work we do for private clients is much more than drafting wills. We often function as the general counsel for wealthy and influential families. Estate planning and ownership issues are important pieces, but we are strategic advisors, helping them navigate all the challenges of wealth across generations.
Originally published February 2022
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