What is asset tracing?
In some divorces, a spouse will try to conceal assets to prevent the other spouse from gaining a share. Often these assets are held offshore making asset tracing an important process.
Tracing and securing all your spouses’ assets during a divorce allows you to ensure that all relevant information is put in front of the courts. This is important to achieve a fair outcome.
How does asset tracing work in divorce proceedings?
There are various legal strategies can be used to uncover hidden assets in a divorce. Legal orders can be obtained including search orders, disclosure orders, freezing injunctions and orders for questioning to compel disclosure of assets.
By uncovering hidden assets, solicitors can help ensure a fair financial settlement on divorce.
Methods of asset tracing in a divorce
A solicitor will review all financial documentation submitted with Form E including bank statements, investment portfolios, tax returns and property deeds. The solicitor will also analyse any bank transactions to any hidden accounts, unusual withdrawals, transfers to third parties or offshore accounts. If necessary other methods of asset tracing can be used including:
- Carrying out searches with the Land Registry and Companies House to review property and business records.
- Employing a forensic accountant who can examine tax returns and company accounts to identify any discrepancies, undisclosed assets or transfers to offshore accounts.
- Employing a tracing agent who has access to software which analyses large volumes of data and can identify irregularities and trace assets.
- Undertaking a lifestyle analysis. Searching online platforms and social media can reveal information about a spouse’s lifestyle and spending habits that may contradict the information they disclosed.
- Obtaining credit reports to ensure debt is not inflated to make a spouse appear less wealthy.
What assets can be uncovered during a divorce?
Assets that can be uncovered and traced during a divorce include:
- bank accounts
- investment portfolios
- crypto-currency
- business interests
- pensions
- properties in England and Wales or other jurisdictions
- tangible assets such as jewellery, artwork, vehicles, collectibles and antiques
- offshore accounts which can be held in tax havens
- trusts which hold assets
- fictitious debts – this can make a spouse appear less wealthy
- undisclosed sources of income or underreporting of income
- deferred bonuses – a spouse would not disclose in an attempt to avoid those monies being included in the divorce settlement
How our solicitors can help you with asset tracing
Tracing assets is not a straightforward task and can be a complex process which often requires professional assistance to ensure a fair and equitable asset distribution.
Having a solicitor trace assets offers a client several benefits. It helps establish the true extent of a spouses wealth, locates hidden assets and provides evidence for legal proceedings to ensure clients receive a fair distribution of the financial assets.
