Hidden Assets in Divorce: What We See in Casework

As Forensic Accountants, we are frequently asked to consider hidden assets in both criminal matters and divorce/separation. This article highlights some of the ways in which assets can be hidden from a spouse and follows on from our summary of the red flags to look out for.

How can assets be hidden during a divorce?

Here are some examples of the activities we often see when working on hidden assets cases:

• Giving/gifting assets to friends and/or family to ‘hold on to’.
• Transferring money or shares, either temporarily or permanently.
• Manipulating accounts, often in owner-managed businesses, and reporting a worse trading and profitability scenario than is actually the case.
• Creating invoices that are not real, to give the impression that there are liabilities that have to be met.
• Falsely indicating that a third party has lent money into a business.
• ’Secret’ bank and savings accounts, including PAYPAL accounts.
• Deferring the payment of bonuses, incentives, or commission payments.
• Failing to declare income when reporting to HMRC.
• Denying the existence of an asset e.g., shareholdings, intellectual property, number plates.
• Using cryptocurrencies, a type of digital currency, managed through a crypto wallet and kept secure by digital keys (a string of letters and numbers like a password).
• Setting up trusts.
• Holding assets offshore, making them harder to locate and value. Holding offshore assets is not illegal, but not disclosing them in a divorce is.
• Small regular cash withdrawals over a period of time or large one-off payments made sometime in the past.
• Including debts that do not exist.
• Deliberately devaluing assets by reporting a much lower value than they are worth.
• Claiming that assets are held for third parties.

Should you need any assistance regarding potential hidden assets, please email Raymond Davidson at raymond.davidson@davidsonsforensic.co.uk or call him on 07719192257.