Millionaire divorce tips

Millionaire divorce tips

The New York Times published an article titled “How to Hide $400 Million” about the Florida divorce between a multi-millionaire couple. The legal techniques can also used in divorces of people of more modest means in Chicago. Below is how these seemingly high-end techniques apply to your regular divorce case:

The best investigator is you.

In the millionaire divorce:
The wife does the initial legwork to find clues of the family’s real net worth.

In your case:
In your case, you will likely be the initial person doing the investigative work.

Tax returns provide clues.

In the millionaire divorce:
The husband’s tax returns show the family’s holding company grossed more than $73.5 million in a year. Mysteriously, the ordinary business income was just $12,284.

In your case:
Even if a tax return is all you have, it might persuade the judge that something fishy is going on. Your spouse might need to show some concrete evidence to back up his tax return claims.

Court can freeze assets.

In the millionaire divorce:
The wife’s lawyers persuade the judge to “impose a sweeping asset injunction against Oesterlund [the husband], one that prohibited him from selling, merging or borrowing against any of his assets.” The wife succeeds by arguing that the husband “was using illegal asset transfers to defraud his wife”.

In your case:
You can obtain a court order to prevent a spouse from transfering marital funds out of the court’s reach. However, even if your spouse does successfully transfer money out of the court’s reach, the court may jail a spouse for not complying with a court order to return the funds.

Subpoenas are a necessity.

In the millionaire divorce:
The wife subpoenas information “from any company or person who might have evidence relevant to the hearing.” The witnesses are ordered to come to the hearing with the relevant financial documents within their control. The end-goal is not necessarily to have the witnesses testify. The end goal is to see the documents that the witnesses bring along with them to the emergency hearing. Through this process the wife learns that the husband claimed a net worth of $400 million when applying for a loan.

In your case:
Asking witnesses to appear in court for an emergency/expedited hearing is one of the few ways to gain access to documents quickly. However, in Chicago divorce courts witnesses will often “forget” to bring documents with them. So this technique might not work as well in Chicago.

Creative lawyering can go a long way.

In the millionaire divorce:
The wife sues herself (or her company) to gain legal control over the parties assets by intervening in a Florida attorney general case against her company (which had been left dormant by the AG) on the attorney general’s behalf.

In your case:
Sometimes people will hide money with their friend or relative. You may have to add those parties to the divorce case to make sure the funds are returned. Or you might want to start a new case against a party colluding with your spouse.

The judge needs to know you’re honest.

In the millionaire divorce:
Due to the husband’s tax evasion and complex legal maneuvers to avoid giving his wife her fair share, it is impossible to assess the family’s real assets. However, the wife’s lawyers do have the loan applications that claimed that his assets were worth $400 million.

The wife’s financial discovery then puts the husband in an awkward situation: “To prove that Osterlund [the husband’s] estate was much smaller, his lawyers had to reveal where and how he had hidden [the money]. If they refused, and a judge decided to award Pursglove [the wife] $200 million, Osterlund wouldn’t have enough liquid wealth to pay up. He could be ruined.”

In your case:
It is really common for people to lie about their net worth or their income on loan applications or credit card applications. However, if you behave yourself well, no judge is going to hold you to whatever you claimed on a loan application that you were worth. Judges know people lie on loan applications and they don’t read too much into them. However, if a spouse is refusing to be transparent about the family’s assets, a judge might say, “The only real evidence I have of your net worth is this statement that you made on this loan application, so I’m going to order you to pay your spouse their share of those assets.”

Conclusion

It will take a lot of work for you and your lawyer to find your spouse’s hidden assets. Also, there is nearly always a way to track the bulk of the funds a spouse is hiding. This is because it is hard not to leave tracks when you’re dealing with substantial assets. However, it is time consuming and expensive to obtain enough evidence to convice a judge of your spouse’s shenanigans.

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