After taking money from Walmart heirs, Ron DeSantis and the Florida Legislature helped billionaires hide their family fortunes

Florida's Republican leaders passed controversial laws weakening transparency around private family trusts — which records suggest may have been a favor for the richest family in the world.

Photo credit: Mike Mozart

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Last year, Florida Gov. Ron DeSantis and the Republican-controlled state Legislature teamed up to pass a pair of bills that made it easier for billionaires to hide their fortunes from the outside world — and from federal taxes.

It wasn’t clear at the time who was behind the bills, which weakened transparency around private family trusts — a type of financial vehicle used by superrich families to pass their wealth from one generation to the next without paying estate or inheritance taxes.

But legislative, corporate and campaign-finance records suggest that DeSantis and the Legislature enacted the laws, at least in part, as a favor for the richest family in the world: The Waltons, the heirs to the Walmart empire.

Emails and text messages — first obtained by Jeff Schweers of the Orlando Sentinel, who broke the story Thursday morning — show that both bills were written in part by lobbyists hired by a front group called the “Florida Coalition for Modern Laws.”

And state corporate records show the Florida Coalition for Modern Laws was created by a trusts-and-estates partner at a Manhattan law firm who had recently set up a private trust company in Florida that, according to Bloomberg Law, is affiliated with the Walton family.

At the same time, in the weeks leading up to last year’s legislative session, campaign-finance records show that billionaire Walmart heir Jim Walton — a son of Walmart Inc. founder Sam Walton — showered roughly $100,000 on members of the Florida Legislature. Most of Walton’s donations went to lawmakers with direct roles in the family-trust legislation, including the bill sponsors and key committee chairs.

And shortly after the session ended, another billionaire Walmart heir — Rob Walton, Jim Walton’s brother — gave $25,000 to Florida Gov. Ron DeSantis. The governor then signed both family-trust bills into law.

Representatives for the Walton family, who have a combined net worth estimated at $224.5 billion, did not respond to requests for comment. Nor did a spokesperson for DeSantis, who raised more than $12 million from more than 40 billionaire donors during his 2022 re-election campaign.

This might seem like something that’s only a big deal to billionaires. Lawmakers even acknowledged during public hearings that these two bills were designed to help “high net worth individuals.”

But state laws like these, which help the superrich sequester their wealth away for centuries, are harmful to everyone else, said Chuck Collins, the director of the Program on Inequality at the Institute for Policy Studies, a left-leaning think tank in Washington, and the co-author of a September 2022 report scrutinizing state trust laws.

That’s because they make it easier for the top 1 percent of Americans to grow their fortunes across generations — tax-free and away from the prying eyes of everyone from creditors to investigators. That further concentrates money and influence in the hands of an elite few. And it leaves the remaining 99 percent of taxpayers to pick up the tab for public services.

“You’re kind of re-feudalizing America,” Collins said. “You’re allowing these dynastically wealthy families to put their wealth out of reach of accountability, taxation, and any kind of understanding.

“It’s a form of power.”

Tools of tax avoidance

To understand how Ron DeSantis and the Florida Legislature just helped billionaire families like the Waltons, you first have to understand what trusts are and how they’re used.

Trusts have been around since the Middle Ages. At their core, they are financial agreements in which one person (the “grantor” or “settlor”) transfers something of value to a second person (the “trustee”) who manages it for the sake of a third person (the “beneficiary”).

A trust can be as simple as a parent setting money aside to be given to their children once they reach a certain age or to pay for future care for a loved one with special needs.

But they are often far larger and more complex. Each party to a trust — the grantor, the trustee and the beneficiary — can be a group of people or a company. Trusts can be used to hold vast and varied fortunes, from cash and corporate stock to real estate, artwork and yachts.

Trusts are, more than anything, tools of tax avoidance. That’s because they create a kind of “ownership limbo,” where an asset has been legally given away by the grantor but not yet received by the beneficiary.

Moving wealth into trusts is how rich families sidestep federal gift and estate taxes when passing inheritances on to children, grandchildren and future descendants even further down the line.

In fact, in 2021, the nonprofit news organization ProPublica obtained more than a decades’ worth of tax returns for the wealthiest individuals in America. Among other secrets, those filings revealed that more than half of the 100 richest people in the country use trusts to avoid estate tax. ProPublica was even able to zero in on how three dynastic families in particular — the Mellon, Mars and Scripps families — shielded their fortunes from taxes for generations.

Trusts are also infamously opaque. Also in 2021, a global coalition of news organizations published a series of reports based on a leaked cache of documents known as the “Pandora Papers,” which revealed that billionaires and moguls from overseas are also hiding assets in U.S.-based trusts.

Florida: A ‘billionaire enabler’ state

The amount of wealth stashed in U.S. trusts has exploded in recent years — to an estimated $5.6 trillion — driven in large part by state Legislatures that have passed laws deregulating the industry and allowing for longer-lasting, more complex and more opaque trusts.  

Partly because of the Pandora Papers, South Dakota has become the poster child for states that have turned themselves into global trust tax havens.

But Florida is playing this game, too. In fact, the Institute for Policy Studies calls Florida one of 13 “billionaire-enabler” states around the country because it offers lax trust laws and a regressive tax code in which income earned by the assets stashed inside a trust are exempt from state taxes.

Historically, one of the most important restrictions on the use of trusts as tax shields was a law known as the “Rule Against Perpetuities,” which sets limits on how long a trust can last.

Florida’s Rule Against Perpetuities used to set a 90-year limit. But in 2000 — during former Republican Gov. Jeb Bush’s first term in office — the state lengthened it to 360 years.  

More recently — under former Republican Gov. Rick Scott — Florida enacted a law allowing the creation of unlicensed “family trust companies,” which wealthy families can set up to manage their own trusts.  

In other words, that 2014 law essentially allows superrich families to continue to manage their wealth even after it has been moved into a theoretically independent trust — and to do so with less oversight or transparency.

These private family trust companies really are only for the superrich: Industry experts say the families that create private trust companies typically have a net worth of at least $200 million.

The Waltons head to Florida

In December 2018, a trusts-and-estates partner at a 200-year-old law firm in Manhattan helped set up a new family trust company in Naples called “River Bend Holdings LLC,” which, according to LinkedIn, serves “the trust administration needs of a single, multigenerational family.”

That family appears to be the Waltons, according to Bloomberg Law, which unearthed extensive links between River Bend Holdings and Walton Family Enterprises, the family’s main investment vehicle.  

Less than a year later, that same New York attorney set up a new nonprofit in Florida: The Florida Coalition for Modern Laws — which immediately set out to rewrite the state’s trust laws.

In late 2019, the coalition drafted a bill to change the rules around who pays federal taxes on income earned by the assets held within a trust. It hired Ballard Partners, the biggest lobbying firm in Florida, to push the proposal through the 2020 session of the Florida Legislature.

Then Jim Walton stated making campaign contributions.

Campaign-finance records show that the Walmart heir has been a longtime donor to a Florida group that promotes private-school vouchers. But he had not previously been a big donor to individual politicians in Florida or the state’s political parties.

That changed in the two months leading up to the 2020 session. Records show Walton gave $96,000 to Florida legislators and the Republican Party of Florida. The donations included $5,000 each to Rep. Mike Caruso (R-Delray Beach) and Sen. Joe Gruters (R-Sarasota), who sponsored the trust legislation written by the Florida Coalition for Modern Laws.

Walton also gave $5,000 to Rep. Bob Rommel (R-Naples), the chair of the House Civil Justice Subcommittee, and $10,000 to Rep. Paul Renner (R-Palm Coast), the chair of the House Judiciary Committee, both of which held hearings on the trust legislation. And Walton gave $10,000 to Sen. Kathleen Passidomo (R-Naples), an important leader in the state Senate and one of the Legislature’s experts on property and trust laws.

Walton also gave $25,000 each to the Republican Party of Florida and to a separate account controlled by Senate Republican leadership.

The 2020 legislation proved to be non-controversial. It flew through the Legislature with unanimous votes in both the House and Senate.

More dangerous changes

But two years later, the Florida Coalition for Modern Laws was back in the state Capitol with a much bigger ask.

The emails and text messages obtained by Schweers and the Orlando Sentinel show that the coalition’s Tallahassee lobbyists wrote two bills this time around.

One of those bills, SB 1368, further weakened Florida’s “Rule Against Perpetuities,” allowing a single trust to continue for 1,000 years.

The bill also allowed private family trust companies — like the Walton-linked River Bend Holdings — to provide fewer financial details to beneficiaries about the assets held in a trust. Revealing fewer details to beneficiaries reduces the risk that an unhappy family member might leak the information to the public.

The second bill, SB 1304, made an even more dramatic change. It ripped open a new hole in Florida’s public-records and open-government laws, by permanently sealing all future court proceedings involving a private family trust company.

In addition to writing the bills, the emails and text messages show that a Coalition for Modern Laws lobbyist also wrote scripts for lawmakers to read while presenting the bills and prepared answers to potential questions from critics.

And Jim Walton made another round of campaign contributions.

Altogether, over the three months leading up to the 2022 session, records show the Walmart heir gave nearly $110,000 more to various legislators and the Republican Party.

This time, the donations included $10,000 to Sen. Joe Gruters (R-Sarasota), who sponsored both trust bills in the Senate; $10,000 to Rep. Mike Beltran (R-Lithia), who sponsored one of the House bills, and $2,500 to former Rep. Elizabeth Fetterhoff (R-DeLand), who sponsored the other House bill.

Walton also gave $7,500 to former Rep. Erin Grall (R-Vero Beach), the chair of the House Judiciary Committee; $5,000 to Rep. Wyman Duggan (R-Jacksonville), the chair of the House Civil Justice Subcommittee; $5,000 to Sen. Danny Burgess (R-Zephyrhills), the chair of the Senate Judiciary Committee; $5,000 to Sen. Jim Boyd (R-Bradenton), the chair of the Senate Banking and Insurance Committee; and $3,000 to former Rep. Nick DiCeglie (R-Indian Rocks Beach), the chair of the House Insurance & Banking Subcommittee.

Each of those committees held hearings on one or both of the trust bills written by the Florida Coalition for Modern Laws. (Grall and DiCeglie were recently elected to the state Senate.)

Jim Walton also once again gave $25,000 each to the Republican Party of Florida and the separate account controlled by Senate Republican leadership.

During hearings, supporters said the changes would ensure that Florida can compete with other states — like South Dakota — for business from private family trusts, which can create work for attorneys, accountants and financial advisors.

“The purpose of these two bills…is to make Florida more competitive with other jurisdictions for these types of trusts,” Beltran said during a House Judiciary Committee meeting — echoing the talking points provided by lobbyists (and the talking points used by lawmakers in other states that have aggressively deregulated trusts).

Beltran added, “What’s going to happen if we don’t adopt rules to be more competitive is Floridians, or people from outside of Florida, who otherwise would have set up these trusts are going to set up these trusts in other jurisdictions that provide these protections.”

This time, however, the bills ran into some resistance. For instance, some lawmakers objected to letting assets be sequestered for 1,000 years. Others warned that allowing trust companies to disclose less financial information to beneficiaries could lead to abuses.

But the sharpest criticism came from open-government advocates, who said Florida lawmakers were taking an unprecedented, and unwarranted, step by closing off all public access to court proceedings for an entire class of cases. (Judges already had the power to seal individual cases, if there is valid reason to do so.)

“Open courts are a democracy cornerstone,” Pamela Marsh, the former executive director of the First Amendment Foundation told members of the House Judiciary Committee. “There’s no good reason to seal certain types of proceedings across the board, regardless of facts.”

Lawmakers chose billionaire privacy over public access. Both bills passed easily. SB 1368, which allowed trusts to endure for 1,000 years, passed 99-19 in the House and 39-0 in the Senate.

The votes on SB 1304, which sealed court records, were only marginally closer: 92-24 in the House and 35-3 in the Senate.

That left only Florida Gov. Ron DeSantis standing in the way. But a little more than a month after session ended — on April 29 — Rob Walton gave $25,000 to the governor.

DeSantis signed the first bill one week later. He signed the second one a few weeks after that.

And then a few months after that, the Walton family topped Bloomberg’s ranking of the world’s wealthiest families for the fourth year in a row.

Correction: An earlier version of this story misstated the name of the Florida Coalition for Modern Laws.