Like my posts dated July 3 & February 3, 2014 & December 9, 2013, today’s post outlines tactics for hiding assets. Today’s post is also the 11th post in my Divorce & Hidden Money series.
Your divorcing husband/wife may try to cheat you out of your fair share of marital assets by employing the following tactics in anticipation of a valuation, equitable distribution or other court hearing:
- NOMINEES: Paramours, friends, family members or business entities might secretly purchase real estate, automobiles and other valuables on behalf of a divorcing spouse, as nominees (i.e. intermediaries). A divorcing spouse may also utilize nominees to open bank accounts which the divorcing spouse then transfers his/her cash to. Some additionally conceal these nominee bank accounts by hiring a third party to be the signatory on the accounts, as discussed at this webpage offering a nominee bank signatory service.
- FRAUDULENT TRANSFERS: When fraudulent transfers are used to hide assets the subject of a divorce, the Court looks for suspicious circumstances known as badges of fraud. For example, the Court in Dempster v. Overview Equities, Inc., 773 N.Y.S.2d 71 (2d Dept 2004), commented that a divorcing husband’s transfer of his residence to a Delaware corporation was ‘replete with badges of fraud.’ This transfer occurred during the divorce just before the valuation trial of the husband’s business interests. The Delaware corporation also operated from the same address as the husband’s other businesses and was formed only two days before the residence was transferred to it.
- ALTERED RECORDS: Mr. Harold Hamm’s $17 billion ownership interest in Continental Resources, Inc. was at stake in his divorce from Ms. Sue Ann Arnall. A September 24th Reuters article suggests Continental could conceivably have altered its website and a U.S. Securities Exchange Commission filing, to diminish Continental’s accomplishments under Mr. Hamm’s leadership. Since Ms. Arnall reportedly argued that Mr. Hamm’s labor enhanced Continental’s value, the altered records had the potential to reduce Mr. Hamm’s divorce payout to Ms. Arnall. Meanwhile, Mr. Hamm is believed to have basically asserted that the altered records at Continental’s website were revisions to inaccuracies. Furthermore, the Daily Mail reports the couple recently reached a divorce settlement which is the 2nd largest in U.S. history.
Image Courtesy of Flickr (Licensed) by West Midlands Police
Copyright 2014 Fred L. Abrams