Blind Trust

A blind trust is a trust in which the beneficiaries are unaware of the trust’s specific assets, and in which a fiduciary third party has discretion over all management of the trust assets. For example, politicians may use a blind trust to hold their assets while they’re in office to avoid conflict of interest accusations. Blind trusts are set up with the politician as both grantor and beneficiary, and a trust company as trustee. The trust company holds stocks, bonds, real estate, and other income-generating property in trust for the politician-beneficiary, but the politician lacks knowledge of what stocks or bonds or real estate or other investments are in the trust. In this manner, the politician is immune to accusations of enacting legislation for his/her own gain.