Most people enter the divorce process believing their soon to be ex-spouse is honest. However, this is not always the situation. The fact is dishonesty is a common reason for seeking a divorce. Even if you have no reason to suspect your spouse is hiding assets and misrepresenting their finances, it is prudent to vet their finances thoroughly.
Many people will do whatever it takes to conceal and hold on to what they believe is their money. Moreover, some will even create secret accounts, or perform other financial actions to conceal assets during the course of a marriage. It is possible to discover hidden assets in a divorce to ensure you receive a fair settlement.
The good news is an experienced divorce attorney has many tools at their disposal to discover hidden assets including but not limited to interrogatories, Requests for Production of Documents, Depositions, accountants, forensic accountants, private investigators etc.
In today’s world, many couples have very complicated financial portfolios that may include retirement plans, stocks, vacation properties, and more. Hiding places for assets are often predictable. These are some of the more common:
1. Family and Friends – Your spouse may conspire with family or good friends. This is often done by making payments for imaginary items or services, then getting reimbursed after the divorce. An experienced attorney will scrutinize payments made with both personal and business accounts.
2. Fake Employees – Having a fake employee on the payroll is a common technique for concealing the money generated by a business. While your spouse may think they are being slick, an audit of their payroll will uncover the truth.
3. Unreported Income – Does your ex-spouse work in a cash business? Some people believe they can keep their true income hidden by excluding revenue from their financial statements. However, lifestyle costs often reveal the truth.
4. Collectibles – One way to hide money is investing in antiques and artwork, or even comic books and baseball cards. These items are often bought over the course of the marriage, and then the value is under-reported during the divorce.
5. Delayed Compensation – Your ex-spouse’s stock options, raises, and bonuses are all included in a divorce. However, if your ex-spouse has a friendly boss, they can conspire to delay promotions or payments of bonuses.
6. Custodial Accounts – One of the most devious methods of hiding money is setting up a custodial account in the name of a child to avoid declaring the account on a financial statement.
If you’re considering divorce and have concerns about the possibility of hidden assets, I encourage you to call my office and schedule an appointment.