05 Jun When a divorcing spouse is hiding money

Q. If a husband has full, secretive control over finances and holdings, how does the wife go about getting full disclosure?
— Dicey situation

A. What you’re describing can be a very complex situation, and you should be sure to hire an experienced family law attorney.

As part of divorce proceedings, each spouse will have an opportunity to secure full disclosure of all assets and liabilities, said Kenneth White, a divorce attorney for Shane and White in Edison.

For example, he said, within 20 days of an answer to a complaint for divorce being filed, the New Jersey court rules require each party to file a “Case Information Statement.”

“A Case Information Statement is a form drafted by the legislature, created for the specific purpose of allowing each party and the court the ability to secure a full financial picture of the parties at a glance,” White said.

Within this form each party is obligated to account for their independent and joint annual income, their monthly budgets, all existing assets, all existing liabilities and additional relevant financial information, he said.

On the last page of the form, each party is required to sign an oath confirming the truthfulness of the information contained within the statement, acknowledging that failure to have provided full financial disclosure is a punishable offense.

White said there are additional tools to secure full financial disclosure.

Generally, he said, each party will engage in “discovery.”

By way of discovery, interrogatories — questions that require detailed answers —will be served upon each party, and the questions can be as specific as you wish, he said.

Similarly, a “Notice to Produce” will generally be served by way of which a party can demand that his/her spouse provides copies of certain, specific documents, such as bank statements, brokerage statement, retirement benefit summaries and more.

If you don’t trust that your spouse will cooperate with discovery, you can secure documentation directly from any financial institution where you believe your spouse has assets.

He said subpoenas can be served upon institutions within the state, such as banks, brokerage houses, employers and more, White said. The subpoenas can require the institutions to provide copies of all relevant records for any account existing in the name of one’s spouse.

“While you may believe that your spouse has been very secretive, absent being able to confirm information regarding cash, a review of an individual’s tax return provides plenty of information to get started with,” White said. “Specifically, within the tax return you will be able to identify any existing bank accounts that paid your spouse interest in the past year, where brokerage accounts are maintained, whether retirement benefits were liquidated.”

While not generally required, in complex matters with significant wealth at issue or for self-employed individuals, a spouse may find it necessary to retain — or ask a court to appoint — a forensic accountant. Such an individual possesses the skills to value businesses, assess true annual incomes, account for all assets and liabilities, search for and identify if assets have been wrongfully dissipated and more.

So go ahead and find a good family law attorney who can help you to secure full financial disclosure.

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This post was first published in June 2017.