10 Easy Ways to Hide Assets From Your Spouse

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Dog storing money bags
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Financial infidelity and lies are all too common in marriages. One in three people admitted to financial infidelity against their partner, according to a January poll for the National Endowment for Financial Education. And that's just the ones who admitted it. So can you imagine the deception that can occur during a divorce?

Unfortunately, I don't have to imagine. As a divorce financial planner who often works with the "out spouse" –- the term for the partner in a marriage who was never plugged in to the finances, managed the cash flow, paid the bills or had relationships with the CPA, financial adviser, or attorney. I've seen financial deception firsthand as the more savvy and informed "in spouse" tries to cover up cash, hide investments and fabricate expenses and debts.

If you are considering a divorce or in the middle of one –- especially if you are the out spouse -– you need to look for for financial deception because it can dramatically affect the assets you obtain and the marital and child support you receive. Although failing to fully and truthfully disclose all assets and liabilities is a crime, don't count on that to deter your soon-to-be ex-spouse.

The best way to catch a criminal is to think like a criminal. So, to help you get into the mind of a soon-to-be ex with their mind on taking you to the cleaners, here are 10 ways I could hide assets and income from my spouse in a divorce:

1. Transfer assets to a separate account. This is simple and common. Here I would take money from our joint bank and brokerage accounts and transfer them to an account only in my name. Fraudulent? Yes. Effective? Absolutely.

2. Transfer assets to a friend. In a joint bank or brokerage account, both parties have full control over the assets.
I could systematically transfer cash and/or investments to a buddy's account, and then once the divorce is finalized, he or she could transfer it back to an account in only my name. The advantage in transferring the assets to a friend is that when I am legally obligated to report marital assets, these transferred assets are not technically part of our marital property.

3. Overpay the Internal Revenue Service. With a little planning, this is a terrific way to shield assets; and if caught, it's easy to play the "aw shucks, I totally forgot about this" card. If I knew I was going to file for divorce next year, I could instruct the IRS to use this year's refund for next year's tax. Once the divorce is final, I'd have a fat overpayment with the IRS that I could use against future tax.

4. Take cash withdrawals on debit cards. This one starts with "Honey, I'm going to the store" and ends with "Yes, I would" when asked if I want cash back. Although I probably won't get rich, given enough time I could amass a decent stockpile of cash by taking $60 or $80 every time I am at the grocery. The beauty is that the cash goes under the radar because the total charge shows as groceries.

5. Turn down promotions and raises. If I am friendly with the boss, I would tell him or of my forthcoming divorce and ask that they delay any promotions and set any raises/bonuses aside until after it was finalized.

6. Accrue commissions. If I closed a big deal and was anticipating a large commission payment, I would let my employer know that I wanted to delay receipt for ... tax purposes.

7. Forget about employer retirement accounts or stock options. Memory is the first thing to go with age. How could I be blamed for forgetting about a defined benefit plan, ESOP or stock options I own through my employer? I mean, they hardly ever send statements.

The above tactics are child's play compared to strategies available when you own your own business.

8. Not invoice clients. It wouldn't be difficult to delay invoicing clients until after the divorce. Although accounts receivables would be accrued assets, this is easier to hide than cold hard cash.

9. Create fake expenses. "Yes dear, I'd love to give you more money but my business is struggling ..." thanks to the fact that I've created fake expenses, pre-paid vendors, added my cousins to payroll and started paying friends for their "consulting" expertise.

10. Go on a shopping spree. Have you seen the new $100,000 piece of art in my office? Well you would. I'd buy all kinds of personal items and charge exotic vacations to my company, which would quickly soak up any profit that could be divided in the divorce.

I need a shower after dreaming up this list. People hiding assets in a divorce is a real and pervasive problem, but those who do it can only get away with it if their spouse stays in the dark. So if you are the out spouse, it's time to get more plugged into your finances. If you are going through a divorce, don't accept your soon-to-be ex's financial disclosures at face value. Do some digging, and get your attorney and divorce financial adviser involved. If there are significant assets or a company, hire a forensic accountant.

One last thing: If you are disgusted by my criminal ideas and worried for my spouse, don't be. She's a certified fraud examiner. If I surreptitiously tossed a coin in a fountain, she'd discover it before it hit the water.


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24 Comments

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Nguyen Van Faulk

This is really good advice! I employed almost all of these against my ex-wife thanks to you. Fortunately for me she's not a fraud examiner, lol. I always told her that her finding personal finance "super boring" was eventually going to hurt her. Super lol! She got what she deserved.

May 24 2014 at 10:08 PM Report abuse rate up rate down Reply
Davis James

http://www.amazon.com/b?_encoding=UTF8&site-redirect=&node=468642&tag=tabbooingcom-20&linkCode=ur2&camp=1789&creative=9325

May 05 2014 at 12:45 PM Report abuse rate up rate down Reply
slw9800

DON'T get married. How 'bout that.

April 19 2014 at 8:21 AM Report abuse rate up rate down Reply
slw9800

For the spouses that wouldn't know where the kitchen is or get lost in it- hide stuff there, hahaha

April 19 2014 at 8:08 AM Report abuse rate up rate down Reply
BEWARE.. HUNTERS

How totally S H A D E Y .

April 03 2014 at 5:29 PM Report abuse rate up rate down Reply
pjgblg

If you find this necessary, you chose the wrong person for your spouse

April 02 2014 at 6:18 AM Report abuse rate up rate down Reply
weilunion

Great article on deceit and fraud of ones' spouse. Oh, how does Wall St. do it? They really know the insides and out of hiding money. The dog house picture was great: we are all in the dog house now that the rich have hidden the money they asset stripped from the US

April 01 2014 at 10:43 PM Report abuse rate up rate down Reply
drdave415

I bought a new car and paid cash, taking my wife, who wanted a divorce with me to do so. When we settled, the car was worth much less than purchase price, saving me thousands.

April 01 2014 at 9:51 PM Report abuse rate up rate down Reply
evd10

This guy missed a couple. Gold coins bought on the secondary market for cash. Just don't keep them in a safety deposit box. Savings bonds bought in the name of an elderly parent with you as beneficiary.

April 01 2014 at 8:20 PM Report abuse +1 rate up rate down Reply
pcfriar66

All of these are not fraud. There is nothing wrong with overpayin g income taxes, asking a boss to delay a comission, promotions, and raises, or, for a self employed person, to delay sending out invoices to customers. Also, transferring money from a joint account to your won separate account is OK too, up to the amount that actually represents your funds. The only things that would be crooked would be transferring money to a friend, and creating fake expenses. The excess withdrawl on a debit card would not provide much money since they usually involve minor, everyday purchases.

April 01 2014 at 2:03 PM Report abuse +2 rate up rate down Reply