Some people are greedy. They know it’s illegal to try to hide their assets and disguise their wealth during divorce. But they do it anyway because they want to keep more than their fair share.
If you’re headed toward divorce and suspect your spouse may be hiding some of his or her assets, you’ll want to work with an attorney who knows how to find them. Experience matters because there’s no shortage of crazy places people try to hide their wealth. Here are some of the craziest.
More common, less crazy
Despite the stakes—and the knowledge that most forensic accountants can spot these tricks with their eyes closed—most people who try to hide their assets do so in several predictable ways:
- Accepting, and not reporting, cash income
- Making expensive purchases—then claiming they’re worth less than they are
- Creating hidden or disguised accounts, such as custodial accounts set up in a child’s name
- Overpaying taxes or credit card debts, to claim future refunds
- “Losing” the assets or simply denying they exist
All these tricks allow your spouse to retain control of his or her assets. But good forensic accountants can work past most of these tricks. As an example, consider the story of the $350,000 vehicle hidden in a hangar. The wife’s team learned about it after they found a gas purchase made in the state where the husband had hidden it.
Less common, more crazy
Some people will go one step further and trust their money to just about anyone other than their spouse. Some examples of these tricks include:
- Diverting funds to a lover through gifts, vacations, rent, meals or the like
- Buying goods or services that never existed—from friends, colleagues or family members who plan to return the money later
- Waiting to accept a raise, bonus or stock option
- Funneling the money into fake companies
- Physically hiding cash assets or asking friends or family members to hold onto their cash for them
One man was so desperate to keep his wealth from his wife during a divorce that he bought diamonds and stored them in his father’s prosthetic leg. His father planned to sell them overseas, but the plan failed when the diamonds triggered airport security.
Always crazy, but far too common
The law demands that people disclose their assets during divorce. It’s crazy not to, but many get greedy. In fact, Fidelity Investments recently found that roughly 10% of all divorces involved hidden assets.
Fair property distribution depends upon a clear view of the assets involved. If you suspect your spouse is hiding assets, you want an attorney who knows where to look.
