High-net-worth divorces often involve intricate financial landscapes that require detailed scrutiny to help better ensure a fair settlement. Parties in this type of divorce often have diverse assets, ranging from offshore accounts to digital currencies, which might not be straightforward to evaluate or even locate. To make matters even more complex, transparency is not always forthcoming. As such, it is important for those who have a high net worth to move forward with caution when navigating their divorce.
One of the first and most important steps is to account for all assets. Tools are available to help if you have concerns that the other party may attempt to hide assets. Examples of methods to help better ensure all assets are accounted for include:
- Discovery methods: These include interrogatories, depositions, and subpoenas to gather comprehensive financial information. This can include a thorough review of tax filings.
- Court orders: In some cases, courts can require parties to repatriate assets or reveal their financial dealings, particularly with offshore accounts.
Forensic accountants can also play a pivotal role in high-net-worth divorces, employing a range of investigative techniques to uncover and value complex assets. This professional can take the lead when it comes to scrutinizing tax returns, bank statements, and other financial records to trace discrepancies or hidden assets. Two specific assets that parties to a divorce may attempt to conceal are digital assets and offshore accounts.
Digital assets
Although digital assets are relatively new, when it comes to divorce the courts generally treat this asset like any other — depending on the details the value of the cryptocurrency, it may be subject to division during the divorce.
Ideally, both parties to the divorce will be forthcoming when disclosing assets, but this is not always the case. The risk of a failure to disclose digital assets is particularly high as many believe that digital assets are essentially untraceable. This is not the case. With the right professionals on your side, you can discover assets like cryptocurrencies. In a recent case, a party to divorce was concerned the other spouse was hiding assets. Upon review, the team was able to discover hundreds of thousands of dollars in digital currency.
Those who have similar concerns can take action to find these assets. There are two primary methods to discover this information. First, as noted above, a forensic accountant can conduct a thorough analysis and dig out the information. Second, it may be possible to get a subpoena and require the centralized crypto exchange to provide the information. Whether one of these or another tactic are best will depend on the particulars of the case.
Offshore accounts
Whether a frequent traveler, investor, or you still have family living abroad, there are many reasons to have financial interests in other countries. Various financial instruments are available and can include a traditional bank account, business interests, and trusts. Regardless of the structure, those subject to a divorce should disclose the presence of this asset. An attempt to hide this type of asset when going through a divorce is not uncommon. It is important to prepare for such an attempt with legal tools to help disclose this information.
High-net-worth divorces present unique challenges due to the complexity and diversity of assets involved. Those in this situation must manage everything from offshore accounts to digital currencies, employing advanced forensic and investigative techniques. As financial environments continue to evolve, particularly with the increasing prevalence of digital assets, staying informed and adaptable can help mitigate the risk of any surprises and help better ensure a smooth transition into post-divorce life.