America’s elite are swiftly transferring hundreds of millions of dollars out of the country, fearing potential targeting by Donald Trump. As concerns about possible restrictions on overseas money transfers grow, wealthy Democratic families are moving vast sums abroad as a precautionary measure against a Republican administration.
Robert Paul, co-head of private clients at the wealth management firm London and Capital, told The Telegraph that these transactions are substantial. “We’ve had five cases in the last three to four weeks, with sums ranging from $40m [£31m], $30m, $30m, $100m, to $50m,” he said. “I expect to see similar, if not larger, sums moving forward.”
These clients are withdrawing money from US brokerage accounts and opening accounts in Switzerland, Jersey, and Guernsey, often placing funds in cash deposits or trust structures overseas, according to Paul. He explained that this trend is primarily about ensuring assets are not located within the US. “There’s a fear of potential capital controls or restrictions on money movement,” he noted. “The last four weeks have seen a sharp increase in this fear due to rapidly changing rhetoric.”
Though Trump hasn’t directly discussed imposing capital controls, investors are wary of his unpredictable policymaking. According to The Telegraph, David Lubin from the international affairs think tank Chatham House speculated that the Trump administration might eventually consider such controls to weaken the dollar or address the US trade deficit.
According to The Telegraph report Judi Galst, managing director of private clients at Henley & Partners in New York, mentioned that a significant portion of her clients is exploring ways to move money out of the US due to the new administration. Some are looking into investment migration options like New Zealand’s investor visa program, while others simply want to open bank accounts in Switzerland. “I’ve spoken to someone at a Swiss bank who mentioned that they’d opened 12 accounts for Americans in the past two weeks,” she said.
This shift is the latest indicator that Trump’s approach to the economy could be detrimental to his own administration. While he campaigned on tax cuts and deregulation, which were expected to benefit markets, his presidency has taken a surprising turn toward protectionism, including a 25% tariff on steel and aluminum imports.
The Federal Reserve, following Goldman Sachs and Fitch Ratings, lowered its US economic growth forecast for this year from 2.1% to 1.7%. Galst noted that her clients are increasingly concerned about holding all their assets in the US. “They want to diversify their risk, and that might mean moving part of their portfolios abroad,” she said.
Ollie Marshall, director of the buying agency Prime Purchase, explained that many of his clients, especially Democratic donors, are worried about potential financial repercussions, despite no concrete evidence that the government is targeting them directly. “The government’s extreme policies could justify their concerns,” he added.
James Knightley, ING’s chief international economist, pointed out that wealthy investors have strong incentives to reduce exposure to US assets, given the potential negative impact of Trump’s trade policies and federal cuts on economic growth, corporate profits, and asset values. However, many economists believe it’s unlikely that Trump would impose capital controls on money leaving the country, as such a move would contradict his broader economic goals.