The role of a Protector in a trust structure is generally understood to be the oversight of certain areas of the trust, with the purpose of ensuring that the trustee properly exercises its administrative and dispositive powers in accordance with the terms of the trust instrument.
With increasingly complicated trust structures, financial regulation and reporting requirements, it would be beneficial if the Protector were to have a financial or legal background that may assist in dealing with the sometimes complex issues that have to be addressed.
The Protector is usually appointed by the settlor of the trust and the Protector’s role, powers and responsibilities are embodied in the terms of the trust deed. This appointment is usually a long-term relationship, with careful thought required to be given when selecting the individual or entity for this role. It is imperative that the Protector understands the role, its obligations and responsibilities, is independent of other interested stakeholders, and has the necessary resources and expertise to properly fulfill their obligations.