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Detecting fraud and asset concealment in divorce

On Behalf of | Oct 9, 2015 | Property Division |

Most Pennsylvania couples who are going through a divorce will not have to worry about financial fraud, but in a small number of cases, hiding or even destroying assets can be a problem. In some divorces, something known as dissipation may occur. This is when a spouse spends or ruins assets. It might include allowing a house to fall into a foreclosure, destruction of personal property or selling items at a loss. Dissipation can also include transferring money into the accounts of others. An individual might lie to family members and claim their spouse is taking money from the account to get them to unwittingly participate in this type of fraud.

There are a number of ways a business owner might conceal assets. These can include falsified income, shell corporations and books or tax records altered to hide income. Individuals who are not business owners can still hide assets in safe deposit boxes or in undeclared sources of income such as bonuses or stock options. Because there are so many ways for people to hide assets, it often takes a forensic accountant to discover the fraud.

A spouse might become suspicious that this fraud is occurring based on the actions of the other spouse. For example, the spouse might begin making unexplained withdrawals from an account or start having mail rerouted.

Whether or not an individual believes that a spouse is hiding assets, property division in a divorce can be a complex process. As a result, a person who is facing the end of a marriage may want to obtain the assistance of a family law attorney. Legal counsel can often be able to identify all marital property and then assist in negotiating a comprehensive settlement agreement in which those assets are fairly divided.