How to divide assets is one of the most common sources of dispute in divorce. In New Jersey, marital property and debt are subject to equitable distribution, which means fair, but not necessarily equal, division between the parties. While New Jersey law requires the full disclosure of all assets, New Jersey Courts do not independently verify whether a party has fully and candidly disclosed all assets. Instead, it is up to the other party to “fact check” the accuracy of their spouse’s disclosures. An attorney, acting in concert with other professionals, has several methods to verify financial disclosures and find hidden assets.
- Discovery. During the discovery process, attorneys will commonly request 3 to 5 years of financial records. Once received, these documents must be examined closely for unusual or suspicious transactions such as extraordinary cash withdrawals, transfers to or from unidentified accounts, or other indications of hidden assets. Attorneys may request additional information, including explanations for these transactions.
- Subpoenas. Once litigation has commenced, attorneys have the authority to issue subpoenas. Although the use of subpoenas can increase costs for clients, a subpoena obtains information directly from the entity. Typically, the only way for a spouse to prevent information from being disclosed by the institution is to ask the Court to “quash” the subpoena. There are limited grounds for doing so.
- Public records searches. A great deal of information can be obtained through government databases readily searchable by the public. Title searches for motor vehicles or real estate can be conducted and may include looking for such property owned by others who may be secreting the asset on behalf of the spouse (e.g., family members, business partners, etc.).
- Private investigators. These professionals have access to databases to locate property not easily found via public record searches, including bank and retirement accounts.
- Forensic accounting. Where there are suspicions of fraud or a party’s finances are complex, a forensic accountant can be invaluable. He/she can conduct a detailed investigation to verify financial information and/or locate evidence of hidden assets.
If you suspect your spouse is hiding assets, it is important to discuss the reasons for your suspicions with your attorney. Your attorney will help you formulate a plan to verify your spouse’s financial disclosures.
If you are considering a divorce, contact us for a consultation.