If you think your spouse may be attempting to hide income or assets during your divorce proceeding, your first step should be to tell your divorce attorney. Your attorney should know how to handle situations such as this, and the sooner he or she can act, the more likely you are to see results.
You should also quickly gather and secure any documentation that might prove your allegations. Financial documents that you can legally access should be copied and turned over to your attorney. This might include tax returns, pay stubs, credit card statements, bank statements, brokerage statements, contracts, or any other documents which might prove the existence of assets or streams of income.
A financial expert with experience in the divorce arena can be invaluable in searching for hidden income and assets. The expert can help you identify the financial documents that will be needed for analysis, and can assist your attorney in determining which documents to subpoena.
The divorce financial analyst can be particularly helpful in performing a lifestyle analysis to search for hidden funds. The expert can examine historical bank statements, credit card statements, brokerage statements, and other financial documents to map out the flow of funds during the marriage and after the separation. The analysis may include comparing deposits and expenditures to known sources of funds. If the deposits or expenditures vary significantly from the known sources of income and assets, this may suggest hidden income or assets.
The lifestyle analysis is a relatively simple concept, but the execution can be complex. There can be thousands of transactions that need to be analyzed and classified. There may be missing data for which estimates may need to be made. The expert needs to consider a variety of sources of funds beyond the common, known sources of income. There may be additional complexities if one or both of the spouses owns business interests and receives income and perks accordingly.
It is important to have the lifestyle analysis done by a qualified professional who has experience with divorce cases. Seek out financial professionals with widely accepted credentials that are closely related to divorce financial analysis.
Tracy L. Coenen, is the leader of Sequence Inc, a forensic accounting firm specializing in fraud investigations and divorce financial analysis. She can be reached at her offices in Milwaukee. WI (414)727.2361 and Chicago, IL (312)498.3661
Certified Divorce Financial Analyst
Business Valuators / CPAs