Wednesday, October 17, 2007

Finding Hidden Assets During a Divorce

If you have no independent knowledge of the assets you have accumulated during your marriage, there is no sure-fire way to make sure that your spouse discloses all your assets in the divorce. This is especially true if your spouse receives significant amounts of cash or your husband has diverting money from the family bank account for many years.

In California, is that each spouse has a duty to disclose to the other party everything the parties own and everything the parties owe (either jointly or separately). Each spouse also has a duty to disclose all sources of income. This includes any income from a business venture, a salary, or from investments. If your spouse does not disclose to you all the assets and you later discover the existence of that asset, you may be awarded the entire value of that asset.

In a divorce, you have the right to conduct discovery. This consists of asking your spouse questions, either in writing or in person. Your can also ask questions of other witnesses, if needed. In addition, your attorney may ask your husband to provide copies of financial documents, such as bank statements, tax returns, deeds to property, etc. This will give you a starting point in your quest to find your assets.

If your spouse puts all his money in the bank and if he writes checks for all your bills, you simply need to obtain a copy of records from every bank account that you are aware of. The statements can then be examined to make sure that all sources of income have been disclosed by your husband. They can also be used to determine whether there are any unclaimed assets. Depending upon the size of your estate, a forensic accountant would normally be retained to help you analyze the bank statements. Generally speaking, you would only hire an expert if you believed your estate was worth $1 million or more.

In addition to analyzing your bank statements, a forensic accountant can also learn a great deal about your assets by examining your tax returns. He or she could help you determine what specific items your attorney should request during the discovery process.

Another commonly-used method for determining hidden assets is the use of a private detective. A detective is valuable in examining public records to determine whether your spouse has any undeclared interest in business ventures, corporations or real estate. A private investigator can also help in finding hidden bank accounts.

If you and your spouse are still living together and you are only contemplating divorce, your best bet is to get a copy of every financial document you can before you leave. If you cannot find a copy of your income tax returns, at least make sure you know who your accountant is, so that you can request a copy at a later date. If you and your spouse are still on speaking terms, request a list of all assets and debts even before you file the divorce action. Ask him for a list of all bank accounts with the balances. If you have to hire an attorney to independently investigate the nature and location of each asset, your divorce will be lengthy and expensive. It is best to obtain as much information as you can on your own, before even filing for divorce.