Unfortunately, during the divorce process, you may realize that your ex is not who you thought they were. They might come off as an entirely different person and even try to conceal assets to increase their share of the property settlement. If you have such a concern, you can take steps to locate hidden assets and funds to ensure you get your full share.
How to tell if your spouse is hiding money or assets
Divorce may be an extremely draining process, made considerably more complicated if one spouse attempts to defraud the other of their property and assets. Even if your relationship was built on trust, you can’t just assume your partner will not try to do this to you in the event of a divorce. People going through a divorce should take the necessary precautions to safeguard their personal interests and ensure assets and funds are properly accounted for throughout the process.
Signs that your spouse is hiding assets and money include:
- Your partner has full access to financial investments, bank account details, and online login credentials.
- Your partner has a secret safe or safe deposit box, especially if it’s utilized for storing valuables and financial documents.
- You receive records or letters for a credit card or bank account you know very little about.
- Your husband has consistently overpaid your credit card balance.
- Automatic payments that are being sent from your shared account to recipients you are unfamiliar with
- Your spouse withdraws large sums from your joint accounts without informing you.
- Your partner buys expensive stuff such as automobiles, artwork, and antiques.
- Your partner underreports the income they receive off the books or from self-employment.
- Your partner often pays bogus debts to a friend or family member who promises to reimburse the money.
Common Hiding Spots
Learning how individuals hide assets and money will help you find them more quickly. Some of the ways people try to hide assets and money include:
- Refuting the asset’s existence
- Giving the asset to a 3rd party to get it back later
- Claiming that the asset was destroyed or lost
- Making up false debt
If you feel your partner is hiding assets and money, you can take measures to confirm your suspicions and try to find them. Here’s a look:
How to Uncover Your Spouse’s Hidden Assets
While verifying that your spouse is hiding assets and funds can be difficult, a paper trail usually follows the existence or concealment of most possessions. As a result, if you believe your spouse is concealing assets, obtain copies of all financial records. This is especially true if, throughout your marriage, your partner managed the books and you had little to no involvement in tracking funds. That means you were an “out spouse.” Simply put, you don’t know your assets and properties well.
If your partner is capable and willing to supply all records, the data-gathering process may be smooth. Unfortunately, this is only sometimes the case. Occasionally your partner needs help locating the documents. If this is the case, you can team up to acquire information. Account records are easy to obtain nowadays, thanks to online portals that allow access to information. You can also file joint information requests with banks, mortgage firms, retirement fund managers, and other third-party service providers.
Sadly, many spouses choose not to provide information to conceal assets. If you suspect your spouse will be unwilling to divulge all financial records during your divorce, you’ll need to go through a proper legal process to obtain documents and information. This is referred to as the “discovery process.”
What’s the discovery process?
The discovery is the official exchange of information between spouses about the evidence or witnesses they’ll present during the divorce. The process offers various means for gathering information but varies between states. The general steps include the following: The discovery process provides multiple means for gathering information, which differ slightly from state to state but often involve all of the next:
You can request documents from your spouse, such as financial statements, tax returns, account details, and loan applications.
You can persuade your spouse to answer written questions referred to as “interrogations” to verify particular claims you suspect are valid. Written questions are also known as “requests for admission.”
You can request an inspection of property such as a wine collection, safes, and safe deposit boxes.
You, your marital partner, and your attorneys will stand before a judicial officer in an oral examination. Your spouse is bound to speak truthfully and must respond to questions from your attorney.
The discovery procedure is an effective technique to obtain financial records from a stubborn spouse since the judge can enforce compliance and impose fines in the event of disobedience. Furthermore, they could face perjury charges if they tell lies. This could be the motivation your marital partner needs to disclose hidden assets and funds. Generally, it would help if you did not depose your husband until you have access to their financial records.
That way, you’ll be able to ask them questions concerning the records and materials you’ve already reviewed. However, locating financial documents can be difficult, especially for people who have investigation experience. That’s where Private investigators come in handy. PIs can help when dealing with a hidden asset, husband or wife.
How can PIs help with assets search for divorce?
An experienced private investigator can assist you in determining whether assets and funds are being hidden. They can access various resources, including databases, public documents, and surveillance equipment. They can assist in the discovery of information pertaining to holdings, income, liabilities, and debts.
Furthermore, private investigators are trained in the technique of subtle investigation. They can unearth material without alarming the subject of the investigation. Some of the information PIs can help obtain includes
PIs can assist you in obtaining copies of recent financial years’ tax filings for comparison and uncovering hidden assets. Indeed, while your partner may not think twice before feeding you lies, they may be scared of lying to the IRS on their tax returns. With the help of a PI who is experienced in financial matters, focus on the following areas to look for indications of hidden assets:
- Wages and income. Dividends, interest, business income, capital gains, pensions, IRA distributions, salaries, wages, tips, annuities, social security, and unemployment compensation are all included on Form 1040. Check to see if this information correlates with what you know.
- Income from interest and dividends. Income-producing investments such as savings accounts, money market accounts, bonds, bank CDs, and loans issued to other parties will also appear on Form 1040. If you’ve previously done an inventory of all assets, use this report to verify and discover new, hidden, or vanished assets.
- Distributions from a retirement plan. 1040 also includes funds received from a delayed compensation scheme or an IRA program. If the spouse received distributions, find out where the money went.
- Refunds. Examine prior tax returns for any tax refunds. When a spouse suspects a divorce, they may purposefully overpay taxes for a particular year, hoping to be reimbursed in full after the conclusion of the divorce.
- Carryforwards. This state or IRS income tax regulation lets taxpayers store unused credits, losses, or deductions for use in a subsequent tax period. For example, people can “carry forward” any charitable contributions exceeding half their income to a future tax year. These kinds of credits must be accounted for during property division.
- Schedule A (Itemized deductions). This section lists local itemized deductions, such as local and state taxes incurred on income, personal property, and real estate. So if your spouse paid taxes on an unfamiliar property, you’d see it here. Note the property name, purchase date, and source of payment.
- Schedule A (Miscellaneous deductions). These may comprise expenses for estate planning and even tax advice. If you weren’t aware your spouse had visited an estate planner or a tax specialist, you should contact them directly. Your investigation may turn up things like a hidden trust fund or real estate property.
- Section III of Schedule B (Foreign Accounts). This section of Schedule B provides a summary of your partner’s foreign trusts and accounts. Check to see if there are any assets you don’t know anything about.
- Schedule C (Profit and loss from business). This is where you look at the reported sales, costs of products sold, company expenses, and net earnings to see how your husband’s business is performing. You can also examine the additional assets acquired by an associated business organization.
- Schedule D (Capital Profits and Losses). This section details capital gains and losses from real estate, bonds, and stocks. Things like dividends and interests can help detect new properties or the absence of previously stated assets.
- Schedule E. This section details additional income and losses from estates, trusts, leased property, and royalties from any books, music, copyrights, software, and patents. These details can assist you in locating any hidden assets.
Bank account statements
Statements from savings and checking accounts can reveal a plethora of information about your wife’s income, expenses, and odd withdrawals or deposits. You might uncover that funds were utilized to buy luxury assets or real estate solely in her name.
Mortgage closing documents
Because lenders require applicants to detail all assets, debts, and income sources when applying for a loan, mortgage closing documents may provide a plethora of information. So, if you and your marital partner were involved in obtaining a mortgage, they must have been required to disclose income and assets on that paperwork. Check for the supplied W-2 forms, Form 1099s, payroll stubs, retirement accounts, brokerage accounts, profit, and loss statements from freelance work, and the listed market value of any rental property and the income they generate.
The disadvantage is that the financial information listed in the mortgage closing papers may be old. Indeed, the accounts listed in the documents may have already been spent or closed by the time you look. Nonetheless, checking these documents is essential. You may discover not only hidden assets but also old ones that you completely forgot over time.
Cash flow and trace accounts
Tracing funds’ movements and accounts during the relationship may reveal the existence of hidden assets. Your PI will require details of all accounts held in your name, that of your spouse, or both. This comprises savings, brokerage, checking trust, and every other account handled by either party during the relationship.
They’ll obtain copies of wire transfers and canceled checks to see whether your partner approved any significant transactions without your knowledge. They’ll use tracing tools to figure out where the money went. The money could be hidden in an individual or a joint account with another party. They could also maintain it as a “gift” with a friend or relative, hoping to take it back after the divorce. Tracing is an excellent method for locating hidden assets.
Hidden bank accounts
Private investigators can assist you in subpoenaing and reviewing material from institutions where you think your partner has hidden accounts. When lawfully subpoenaed, a financial institution must turn over all documents pertaining to your partner’s name. Simply checking the identities of those who sent or received money from your spouse’s accounts is all the PI needs to do. Any strange accounts that pop up could be where they have concealed funds. They can even subpoena information from the recipients’ banks. If the institutions do not comply, they may be held liable.
Financial statements and loan applications
A loan company will require a filled-out application, account records, copies of recent pay stubs, and a notarized declaration pertaining to all assets and liabilities before authorizing a loan. If your husband filed for a loan, your PI can obtain a copy and examine it for hidden assets. Your husband may also have filed a personal financial disclosure with the lender.
This will include all their assets, income, debts, and expenses. It’s a declaration from your husband to the lender about all his finances and the marital estate. Examine the report for any red flags.
Credit card reports
Investigators can look through credit card bills to discover what your partner is spending their money on, which might reveal a secret lover or hidden assets. If they overpay credit card bills, they could have a hidden asset.
If your spouse works as a freelancer or has a business, they may be concealing income or assets from you or making illegal loans that will be returned through the industry. Your private investigator can discover these details by examining the company’s revenue and financial reports.
PIs will also investigate public records to see if your spouse bought any rental properties, vehicles, or luxury properties without your knowledge.
Storage units and safe deposit boxes
Private investigators can also assist in the discovery of storage units and safe deposit boxes where your spouse may be concealing valuables and properties, such as jewelry or records of hidden bank accounts, real estate, vehicles, and so on.
Although couples split for various reasons, one thread that connects all divorces is a lack of trust. Where there are trust issues, you can’t assume your spouse won’t try to cheat you out of assets and funds during the divorce. Discovering hidden holdings or ensuring hidden assets don’t exist will help you get your rightful share of the divorce settlement.
The court may consider the worth of both partners’ separate property when determining how to split marital wealth and debts, so ensure your spouse lists all of their “separate” property, even if you don’t have any ownership rights.
To do that, you’ll have to take inventory of everything. Experts recommend starting early. Before initiating the marriage dissolution process, make a list of all assets. And if you suspect any hidden assets or see any irregularities, get the help of an experienced investigator to look into things.
Our private detectives can assist you in protecting your interests during your divorce.
Indeed, our staff comprises former law enforcement officials from the FBI, IRS, and DEA and can help you get the information you need. Call our office now to set up a free appointment to learn how we can help with asset search for divorce.