As French Jews flee the country due to rising anti-Semitism & a failing economy, 2 dozen families leave with $1.4 billion of their assets with them.
French Jews are facing shocking anti-Semitism, and many feel insecure remaining in France, as the sharp rise in French aliyah figures for the past year show. Tens of thousands of Jews still remain in France, however, but an indication of their future plans can be gleaned from the transfer of Jewish assets out of Europe.
Arutz Sheva interviewed Marlen Kruzhkov, a partner at the New York based Gusrae Kaplan Nusbaum PLLC, who has acted as consultant for a sizable group of French Jewish families. He estimates that his clients have transferred assets worth approximately $1.4 billion dollars to America in recent months.
As their families move, or in preparation for them being forced to move by circumstances in the future, they have unique financial and structural needs – and they are investing en masse. Kruzhkov, in fact, spent his summer going back and forth to and from France.
Although he counts among his clients numerous corporations and high net-worth individuals in Russia, the recent changes in Europe have seen him pick up many French and European Jewish clients. Kruzhkov himself is a Jewish émigré to the US whose family fled the Ukraine some years ago.
Question: When did the phenomenon of French and South African Jews moving financial assets to the US begin?
Kruzhkov: There has always been some interest in US investments from French Jews, but it was minimal and strictly based upon a specific interest in investing in certain opportunities. In the last few years, with the rise of anti-Semitism, that interest has increased markedly.
It is not a political statement to say that of the dozens of Jewish families we have met, only a tiny percentage sees a future for Jews in France.
Interestingly, there has been increased interest from South African Jews of late as well. These communities want to know their assets are safe.
How many individuals have taken part in reaching the sum you have mentioned?
Kruzhkov: We have brought approximately 1.5 Billion dollars to the US from about two dozen families.
Overall, are the Jews staying in France or leaving?
Kruzhkov. Most are emigrating. Mostly to Israel and the US.
Why do you think they are not sending their assets to Israel, whose economy is in great shape?
Kruzhkov: Compared to the US., the Israeli economy is smaller, less diverse, more mired in red tape and more closed off to outsiders. The threat of another potential armed conflict does not help.
What kind of taxes will they be subject to? Do they have to get US citizenship?
Kruzhkov: The tax situation depends on many different issues: are they getting permanent resident/green card status, how many days a year they spend in the U.S., the nature of their investments and investment structures. One does not need to get citizenship to invest in the U.S. In fact not being a U.S. tax resident often makes it more advantageous to invest in the U.S. as it allows for much greater leeway in terms of tax planning.
What kind of assets are we talking about?
Kruzhkov: Most of the investment is in real estate. The rest of the investment is client specific. In other words, a particular client may be in a particular business and so seeks out something similar or a particular client make have particular connections which leads to particular types of investments. Some are seeking bonds and paper investment.
What is the fear – just takeover of assets or physical fear and this is the first step to leaving if things get worse?
Kruzhkov: I think it is a complex equation. It starts with the European economy being in bad shape, add to that France’s economic prospects being particularly poor and then the currently highly unfavorable French tax situation.
Once you add a legitimate concern over anti-Semitism and physical safety, you end up with a potent emigration push. In my opinion more and more Jews will choose to go elsewhere rather than remain in France.
View original Arutz Sheva publication at: http://www.israelnationalnews.com/News/News.aspx/185707#.VCx_dhaLUYA