Divorce can be a difficult process under the best of circumstances. But when one spouse is attempting to hide assets to avoid a full and proper accounting of their property, divorce can become even more challenging and stressful. It’s unfair for your soon-to-be ex to attempt to hide assets from you and the court, and this kind of behavior can make an already complex situation even worse for both of you.
Although it’s understandable that you might feel discouraged and frustrated by the discovery that your spouse is hiding assets, there are still ways to uncover hidden assets during divorce proceedings. With some patience and persistence, you may be able to find what you're looking for. It's also important to remember that an experienced divorce attorney has many tools at their disposal to help uncover hidden assets during divorce proceedings. By working with a knowledgeable divorce attorney, you are more likely to discover the assets that your spouse has tried to hide.
Here are five places to look for your spouse's hidden assets:
#1. Offshore Accounts
One of the most common places for spouses to hide assets during a divorce is in offshore accounts. Offshore accounts offer individuals a way to move money into foreign countries where it can be difficult to trace and may even be outside of the jurisdiction of a court order. Individuals often hide funds in offshore accounts, either to evade taxes or to protect them from divorce proceedings. To discover if any of these exist, you'll need the help of a legal professional who can request information from the relevant financial institutions.
The first step in uncovering hidden assets held in offshore accounts is to look for statements or documents related to any foreign bank accounts. The next step is to contact an attorney who specializes in international asset searches or forensic accounting. They will be able to help you identify and trace the money that has been transferred out of the country by your spouse.
Here are some other tips for uncovering offshore assets:
- Look for life insurance policies or annuities with large cash values or beneficiaries located overseas
- Monitor investments and properties held outside of the U.S.
- Investigate any business interests owned by your spouse abroad
- Check travel records for trips taken abroad during which money could have been transferred out of the country
- Review annual credit card statements for suspicious charges or payments made abroad
#2. Private Businesses
Private business investments can often be used as a way of hiding assets during divorce settlements. Your spouse may have invested money in their own business or other outside businesses without informing you, or they may have diverted some of the profits from a jointly owned business into personal accounts.
To uncover any hidden assets held by your spouse in private businesses, it’s important to understand how these businesses are structured and funded. An experienced divorce lawyer can help investigate any business with which your spouse is affiliated. Information about their financials may not be available publicly, but your attorney will be able to use discovery tools to help uncover any improperly hidden assets in your spouse's business.
Here are some tips for finding these funds:
- Ask for details about all business entities owned by your spouse, including their structure, debts, and investments.
- Scrutinize tax returns for deductions that could indicate hidden income sources or expenses used to conceal income.
- Review financial statements and other documents related to the business to look for suspicious transactions or discrepancies between its accounting books and reality.
- Investigate whether your spouse is receiving payments from third parties related to the business, such as contractors or investors.
- Verify whether any employees have been assigned duties outside of their job descriptions in order to hide income sources.
- Look into mortgages taken out on properties associated with the business as well as any loans that haven’t been reported on tax returns.
- Examine accounts receivable reports to determine if there are any outstanding invoices that haven’t been collected yet.
#3. Personal Property
Your spouse could be keeping personal property from you during the divorce proceedings, such as expensive jewelry or artwork that has been purchased with marital funds but hidden in another location. One common method of hiding valuable personal property is to transfer those possessions to family members or friends.
For example, they may temporarily transfer valuable items like jewelry, expensive artwork, antiques, collectibles, and other items to someone else to keep them away from the eyes of the court in an attempt to try to exclude those assets from being subject to equitable division of property during divorce. In addition, they might also use shell companies, trusts, or LLCs to hide real estate holdings and investments.
To uncover any hidden assets in personal property, you will need the help of an experienced divorce lawyer. They can assist you in reviewing financial documents and evaluating any potential transfers of property or other assets that may have occurred within the past few years.
Here are some tips for discovering hidden assets:
- Look for discrepancies between what your spouse declared on personal tax returns and other records
- Investigate whether any large gifts or loans were made to family members or close friends within the past few years
- Check if your spouse has transferred ownership of any valuables without valid explanation
- Examine bank statements for large purchases
- Monitor credit card activity for payments made towards high value purchases that could not have been made with reported income
- Review insurance documents
#4. Cryptocurrency Accounts
With cryptocurrency becoming increasingly popular, some spouses are turning to digital currencies like Bitcoin to hide assets during divorce proceedings. Cryptocurrencies, such as Bitcoin and Ethereum, are digital currencies that are not regulated by banks or financial institutions. This makes it difficult to track down and audit these accounts during divorce proceedings. If your spouse seems particularly tech-savvy or has expressed an interest in cryptocurrency, it might be worth looking into whether they have any cryptocurrency accounts.
To uncover any hidden cryptocurrency assets held by your spouse, your lawyer will likely secure the services of a forensic accountant who specializes in blockchain technology and cryptocurrency analysis. These experts can analyze the ledger entries of your spouse’s crypto transactions to determine if any suspicious transfers have occurred.
Here are some tips for discovering hidden crypto assets:
- Look for discrepancies between tax returns and other records regarding any income related to cryptocurrencies
- Check whether your spouse has opened any digital wallets or accounts associated with exchanges such as Coinbase or Kraken
- Monitor digital wallet addresses associated with their name or email address
- Investigate digital signatures on past transactions which could indicate ownership of different wallets on the same platform
- Analyze transaction logs to see if there are any unexplained transfers from one wallet to another
Trusts are often used as part of estate planning, but some people may try to use a trust as a way to hide assets from their spouse during their marriage or divorce. Trusts can be set up by your spouse prior to the divorce proceedings to protect financial assets, as well as to minimize estate, gift, and income taxes. Your spouse may use them to transfer assets into a trust with no consideration for marital funds or resources and without informing you of their action.
Trusts come in two types: revocable trusts which allow for control over assets during life, and irrevocable trusts which keep the assets out of reach during life. To uncover any hidden assets held in trust, you'll need the help of a lawyer who specializes in asset discovery services.
Here are some tips for finding these funds:
- Examine all documents related to the trust, such as tax returns, financial statements, and other filings
- Investigate whether any transfers or changes have been made to the trust or its beneficiaries
- Analyze bank statements for large deposits or payments made towards trustee fees
- Review public records such as deeds or property records associated with the trust
- Speak with any advisors or trustees who may have access to information about the trust's finances
By taking these steps you may be able to find evidence of hidden assets that your spouse is attempting to keep out of sight. It's important to remember that uncovering hidden assets is a lengthy process that requires patience and persistence. An experienced divorce attorney has tools at their disposal that can help make this process easier and more effective. Remember – even if it seems like your spouse has gotten away with something, there are still steps you can take to ensure that your marital assets are divided fairly during your divorce.
At Samuelson Hause PLLC, we understand how frustrating it can be when you feel that your spouse isn’t dealing fairly or honestly with you during your divorce. Our divorce attorneys have the experience and resources to help you through your divorce, whether that means tracking down the assets your spouse is trying to hide or helping to ensure that your marital property is divided fairly. Our knowledgeable team of attorneys are well-versed in asset discovery and will work diligently to uncover any hidden assets during your divorce proceedings.
Contact us online or call us at (516) 584-4685 to schedule a consultation to learn more about how we can help you reach a fair settlement in your divorce.