The Role of Forensic Accounting in Unearthing Hidden Assets in Divorce
When one or both spouses in a divorce are ready to make it contentious, the division of assets can take far longer than it really needs to. One of the ways that one spouse can complicate this step is by hiding assets. When a couple divorces, their marital assets must be divided in a way that is fair to both parties. But when one spouse thinks they have a right to those assets, they may take illegal and unethical steps to keep them out of their spouse’s hands.
That’s where a forensic accountant comes in. What happens during a divorce always comes to light, and a forensic accountant can speed up the process of uncovering hidden assets. Wondering how you can fight for what you deserve in your Louisville divorce? Call John H. Ruby & Associates at 502-373-8044 to set up a consultation.
Finding Hidden Income Streams
This is a common issue in high-asset divorces. Couples in this situation often have multiple income streams, and in some cases, one spouse handles the business side of the marriage while the other spouse handles the home and children. The spouse who handles the income streams may take steps to hide them and keep them from being split up. A forensic accountant can use a range of investigative techniques to find hidden income streams. They may utilize tax records, bank statements, business documents and filings, and financial irregularities that indicate hidden income.
Tracking Down Cryptocurrency
Cryptocurrency has completely changed how many divorces play out in recent years. Many people who trade cryptocurrency believe it to be completely untraceable, only to be proven wrong by the forensic accountant hired by their spouse’s attorney during a divorce. Blockchain analysis and data forensics make it easy for an experienced forensic accountant to find crypto stashes and ensure that they are properly divvied up during a divorce.
Preventing Premature Transfer or Sale
One way that individuals attempt to hide assets is by selling or “giving” assets away. In most cases, they aren’t actually selling or disposing of the assets. They are selling or giving away assets to loved ones with the intent of getting them back once the divorce is finalized. When they are actually selling assets, they plan on pocketing the money. These types of transactions are very easy for an experienced forensic accountant to track. When assets have been disposed of by one spouse, the other spouse’s attorney can ensure that their client is properly compensated for that.
Ensuring That Assets Are Properly Valuated
A surprising number of spouses have been taken advantage of during the division of assets. They are often misled by their spouse, who tells them that an asset is worth a certain amount to get them to give up their right to it. Later, the other spouse finds out it was actually worth far more. This is common when one spouse genuinely believes the divorce can be worked out in a fair and mature manner, while the other spouse is determined to take everything they can through any means necessary. A forensic accountant can verify that assets’ values are properly calculated and presented to their client.
Proving That the Other Party Attempted to Hide Assets
Trying to hide assets and getting caught doesn’t just mean that the spouse who hid assets has to split them. It can often mean that the court comes down hard on them when their misdeeds come to light. No judge likes to see this type of unethical behavior in their courtroom and proving that one party attempted to hide assets can be beneficial for the wronged party. A forensic accountant may serve as an expert witness, explaining their investigative methods and professional background to the judge. They can show proof of the other party’s hidden assets and their true value.
Prepare for Your Divorce with John H. Ruby & Associates
Depending on the circumstances of your divorce and how you and your spouse approach it, a forensic accountant may be necessary. We’ll help you understand your options and get the help you need. Call our team of family law attorneys at 502-373-8044 or send us a message online to set up a consultation now.
