Blind Trust

Blind Trust

What is a blind trust and how does it work?


A "blind trust" can be used to refer to a trust established to hold securities and investments which are managed without input or knowledge by the beneficiary of the trust. For example, someone in political office could place his or her securities portfolio in a trust managed by a money manager without disclosure of details, and without taking direction from, the person running for or in public office. The use of a blind trust would avoid any inference of bias in the actions of the politician intended to benefit himself. For example, it could not be said that the politician passed legislation to boost his own stock holdings, because he or she would not even know what those holdings are.

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