What could happen if a beneficiary tries to exert too much control over a third-party self-settled trust?

If a beneficiary tries to exert too much control over a third-party self-settled trust, the trust could be deemed invalid. This is primarily due to the legal principle that a self-settled trust must have specific characteristics to maintain its validity and the intended protections. When the beneficiary has excessive control, it can be argued that the trust does not truly operate independently, which undermines its purpose and can trigger legal scrutiny.

In a self-settled trust, the settlor contributes assets while retaining some degree of benefit; however, excessive control by the beneficiary might lead to the conclusion that it is treated as an asset of the beneficiary themselves, making it vulnerable to creditors or affecting its intended tax benefits. Therefore, if the control exercised by the beneficiary is deemed contrary to the essential provisions of the trust, a court could invalidate the trust entirely to uphold the integrity of trust law.

The other choices, while they may address potential actions in different contexts, do not align directly with the specific legal implications of overreaching control in a self-settled trust situation.