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How to detect fraud within your divorce case

The end of a marriage can be a tumultuous time, full of a wide array of emotions and fears about the future. For many in Colorado, reaching a fair and favorable property division outcome is a primary goal. For those whose family financials are unclear, it can be difficult to know when one spouse may be hiding assets from the other. Financial fraud can leave one party at a distinct disadvantage during a divorce and must be addressed early within the legal process.

When most people think about financial fraud within divorce, they imagine offshore bank accounts and secret investments. In reality, large-scale fraud is rare. What most spouses encounter is a far less dramatic type of fraud, but one that can be harmful, nonetheless.

A common example involves gambling wins or losses of which one spouse is completely unaware. In some cases, retirement or investment accounts that originated prior to the marriage are excluded from the property division process. Some spouses will attempt to "hide" jewelry or inherited items in an effort to remove those assets from the division of wealth.

Another form of financial fraud comes from intentional dissipation of marital wealth. One of the most common ways that this occurs is when a spouse "lends" money to a friend or family member, with the intention of having that person "hold" the funds until after the divorce is complete. A similar tactic is to "sell" items of value for far below their actual worth, with the intent of regaining those assets after the divorce.

For Colorado spouses who are concerned about the actions of their partner, it may be a good idea to discuss the matter with a divorce attorney. An attorney can provide guidance on how to uncover acts of financial fraud and can advise a spouse on whether it makes financial sense to pursue the matter further. Each set of circumstances is different, but when financial fraud leads to significant losses, the spouse who is harmed can pursue a greater share of the remaining marital assets during property division negotiations.  

Source: The Huffington Post, "Financial Fraud and Divorce", Peggy L. Tracy, Oct. 2, 2015

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Brandon Ceglian

Brandon Ceglian's practice focus is family law, landlord-tenant law / real estate, civil litigation, criminal / DUI, and collections. View Attorney Profile

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