Sorting through financial matters can be a challenging aspect of divorce, particularly when a couple is not willing to work together for a fair and speedy resolution to the case. Different states, of course, have different ways of handling financial disputes in divorce. The state of New York uses an approach known as equitable distribution, which involves weighing various factors to reach a fair division of assets.
Default property division rules aside, couples can make use of marital agreements to take greater control over the division of assets in the event of divorce. In negotiating these agreements, it is critical for individuals to work with an experienced attorney who can help ensure that their rights and interests are represented in the agreement.
Whether a couple makes use of a marital agreement to control division of assets in divorce or simply relies on the application of the default rules of state law, full disclosure of assets is always a concern that should be kept in mind. When a fiancé or spouse hides assets from the other and from the court, it is impossible to ensure that the other will receive what he or she is due.
Assets can be hidden in a number of ways. One of the concerns, particularly for the wealthy, is the offshoring of wealth by placing assets in foreign bank accounts, trusts, and shell companies incorporated in other states and countries. Offshoring of wealth can be a particularly complicated issue to deal with in divorce because the banks the wealthy use for this purpose are often protected by a lack of regulation oversight. As a recent New York Times article points out, even the Internal Revenue Service has trouble pursuing those who evade taxes by offshoring wealth.
In our next post, we’ll continue looking at this topic, and how an experienced divorce attorney can help protect a client from being taken advantage of by a partner who attempts to hide his or her wealth.