Sunday, November 15, 2015

Financial Fraud in a Marriage

Financial fraud in a marriage can occur in various ways.  Usually, but not always, the violating spouse has more power and/or earning capacity than the other spouse.

Ways in which financial fraud can occur:

1. Fraudulent spouse spends money on extramarital relationships or on other family members without the innocent spouse's knowledge or consent.
2. Fraudulent spouse applies for credit in innocent spouse's name without consent, increasing debt or commits some other type of forgery to gain control over assets.
3. Fraudulent spouse gambles away or gives away money.
4. Fraudulent spouse has hidden money, accounts, assets, stock options, or bonuses that s/he does not tell innocent spouse about (even when information is sought during a divorce).
5. Property is transferred to others or is "co-owned" with other persons in order to avoid disclosure.

Very often the innocent spouse feels financially powerless in some fashion, although he or she may be educated, intelligent, and may have his or her own source of income.   The fraudulent spouse's goal is to keep his/her earnings and assets separate and secret, sometimes even risking violation of a court order.

In some cases, financial experts must be hired to thoroughly analyze the financial picture. In other cases (such as forgery) criminal charges may need to be filed.

The innocent spouse who is considering a divorce  and suspects financial fraud is encouraged to get as much information as possible (as long as it is physically safe to do so) prior to filing for divorce. Many smartphone cameras take quick and clear photos of documents.   It is important to disclose the suspicion of fraud to the divorce attorney at the initial consult so that all possible steps can be taken early on to protect the innocent spouse's rights.

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