Marriage is meant to be built on trust, honesty and transparency. However, there are spouses who may choose to hide some of their assets from their partner. This could be due to a number of reasons such as wanting to maintain control over those assets or they simply don’t want their partner to know about them. Whatever the reason may be, it is not uncommon for spouses to conceal some of their assets.
In today’s digital age, cryptocurrencies have become another way in which people may choose to hide their assets. Cryptocurrencies are decentralized digital currencies that are not regulated by any central authority. They have become increasingly popular due to their perceived anonymity and security. This has resulted in people using cryptocurrencies as a way to hide their wealth from others, including their spouses.
However, there are experts out there who specialize in finding hidden assets, including those stored in cryptocurrencies. These experts are known as crypto hunters. They use various techniques and tools to uncover hidden assets and help spouses get a fair settlement during a divorce.
So, how do spouses hide assets?
There are many ways in which spouses may hide their assets. Some of the most common methods include:
1. Transferring assets to a friend or family member.
Spouses may transfer ownership of assets such as property or investments to a friend or family member to keep them hidden from their partner.
2. Setting up offshore accounts.
Offshore accounts are bank accounts located outside of the country where the account holder resides. They can be used to hold assets such as cash and investments and can be difficult to trace.
3. Undervaluing assets.
Spouses may undervalue their assets in order to reduce their net worth and minimize the amount of assets that are subject to division in a divorce.
4. Cryptocurrencies.
As mentioned earlier, cryptocurrencies have become a popular way for spouses to hide their assets. Cryptocurrencies are a digital asset that is not easily traced.
How do crypto hunters find hidden assets?
Crypto hunters are experts in uncovering hidden assets, including those stored in cryptocurrencies. They use various techniques and tools to find hidden assets. Here are some of the most common methods used by crypto hunters:
1. Blockchain analysis.
Cryptocurrencies operate on a decentralized database known as a blockchain. A blockchain is a public ledger that records all cryptocurrency transactions. Crypto hunters can use blockchain analysis to track down hidden assets. By analyzing the blockchain, they can see the history of all transactions related to a specific cryptocurrency. This can help them determine if a spouse has been hiding assets in cryptocurrencies.
2. Social media and public information.
Many people share information about their assets on social media or in public forums. Crypto hunters can use this information to build a profile of a person’s financial history and identify hidden assets.
3. Tracing financial transactions.
Crypto hunters can also trace financial transactions by using bank statements, credit card statements, and other financial documents. By analyzing these documents, they can identify any suspicious transactions and track down hidden assets.
4. Forensic accounting.
Forensic accounting is the process of investigating financial records in order to uncover hidden assets. Crypto hunters who specialize in forensic accounting can use this method to identify any discrepancies in financial records and track down hidden assets.
Why is it important to find hidden assets during a divorce?
Finding hidden assets is important during a divorce because it ensures that both spouses receive a fair settlement. If one spouse is hiding assets, it can significantly impact the settlement and result in an unfair distribution of assets. This can leave one spouse at a financial disadvantage and make it difficult for them to move on with their life after the divorce.
In conclusion, spouses may choose to hide their assets for a number of reasons, including wanting to maintain control over those assets or not wanting their partner to know about them. Cryptocurrencies have become a popular way for spouses to conceal their assets. However, there are experts known as crypto hunters who specialize in finding hidden assets, including those stored in cryptocurrencies. Finding hidden assets is important during a divorce to ensure that both spouses receive a fair settlement and can move on with their lives after the divorce.
Financial infidelity has taken on a new level of sophistication with the rise of cryptocurrency investments. As cryptocurrency becomes more popular, divorcing couples are finding hidden assets, which can be difficult to trace. CNBC reported that 1 in 5 Americans have invested in, traded, or used cryptocurrency with men between the ages of 18-49 accounting for the highest share of all demographic groups. Divorce attorneys from Florida, New York, Texas, and California as well as blockchain forensic investigators, financial advisors, spouses who were looking for virtual coins, and crypto holder themselves were spoken to by CNBC to find out how crypto plays a role in divorce cases.
Divorce and family law attorney, Kim Nutter, stated that she had started to become familiar with the crypto vernacular back in 2015. However, the state of Florida, where her practice is based, only recently included “cryptocurrency” into the standard request for production of documents. This process is a fundamental part of establishing the couple’s marital property during the discovery process. Nutter added that she believes the law is still catching up with the new form of currency and finding the right experts can be quite a scramble.
The growing problem of hidden cryptocurrency assets has paved the way for a new category of forensic investigators. Although the blockchain is a public ledger, some spouses have become skilled at concealing their financial situation. Divorce attorney Kelly Burris stated that spouses who are tech-savvy and those who are not can easily hide these assets. Burris added that because cryptocurrency is not regulated by any centralized bank it’s usually impossible to subpoena anybody and get hold of documents and information related to cryptocurrency holdings, adding that explicit cryptocurrency requests in discovery can be found in 40% to 50% of cases.
In the ideal scenario, attorneys suggested that the most effective way to get information on a spouse’s holdings would be to extract the data from a centralized crypto exchange. This process often involves forensic analysis of a computer or phone to uncover a wallet address and then a subsequent blockchain analysis. This process also creates a new area of expertise, like crypto asset forensics, which has become a significant part of legal practice. Forensic investigator Nick Himonidis estimated that 25% of divorce-related cases included some cryptocurrency aspect.
One of the core features of bitcoin is that its public ledger stores all token transactions in its history and is visible to everyone. However, there are various cryptocurrencies known as privacy tokens that have built-in anonymity features. Privacy tokens such as monero, dash, and zcash disguise practically every aspect of transactions, including the identity of the sender and the recipient as well as the transaction amount. Cryptocurrency forensic investigators claim that it is virtually impossible to trace and de-anonymize transactions in monero, which has become increasingly popular among criminals as well.
It seems that lawyers are having a hard time with divorce cases involving cryptocurrency, primarily due to the lack of regulation of cryptocurrencies. This creates a variety of issues when tracing assets, and in some cases, it’s impossible to track a spouse’s cryptocurrency holdings. Despite the growing difficulty, forensic analysts and lawyers state that in most cases, they can prove that the cryptocurrency is hiding somewhere within the divorce proceedings. So, despite the lack of regulation on cryptocurrency, forensic analysts say they can usually find it one way or another.
