Where to Search for Hidden Assets During Divorce
By Candace Bahr, CEA, CDFA and Ginita Wall, CPA, CFP
My husband
just told me he wants a divorce, and he says he’s bee
n thinking about it for quite a
while. I’m afraid that he’s taken steps to hide money so that I won’t
receive a fair share of our property.
It’s smart
of your to be suspicious. Although by and large people are pretty honest while going
through divorce, too many women trust their husbands when they shouldn’t. Looking for
hidden assets is part of my work as a forensic accountant. Here are some of the places
your spouse may have hidden assets.
- Antiques, artwork or hobby equipment that is overlooked and undervalued. Look for lush furnishings in his office.
- Collusion with his employer to delay payment of bonuses, stock options or raises until after the divorce.
- Income, often cash, that is unreported on tax returns and financial statements. You life-style costs during marriage probably exceeded reported income, so document your cash expenditures.
- A custodial account set up in the name of a child, using the child’s social security number.
- Debt repayment of a phony debt to a friend or family member, with the pre-arrangement that the friend will hold the money until after the divorce, then give it to your husband.
- Salary paid to a nonexistent employee from your husband’s business. The checks will be voided after divorce.
- Money paid from the business to someone close, such as father or girlfriend, for business services not rendered. The money will no doubt be given back to your spouse after the divorce is final.
- Delay in signing long-term business contracts until after the divorce.
- Expenses paid for a girlfriend, such as gifts, travel, jewelry, rent or college tuition.
- Investment in municipal bonds or Series EE Savings Bonds for which no interest is reported on tax returns.
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