How Do I Identify and Value Hidden Offshore Accounts in a High-Net-Worth Divorce?
Because California is a community property state, income and assets acquired during a marriage are generally divided equally upon divorce. This division can motivate some spouses to conceal funds in offshore bank accounts to avoid sharing them.
Identifying and valuing these accounts is critical to ensure a fair settlement. With the help of an experienced divorce lawyer, you can uncover hidden assets, evaluate their worth, and protect your financial interests during the divorce process.
What Are Offshore Accounts?
Offshore accounts are bank accounts that are opened and managed in another country. Many individuals use them for legitimate reasons, such as conducting international business or protecting assets in different currencies.
However, because these accounts often involve less regulatory oversight and financial transparency, they can also be misused. In the context of divorce, offshore accounts sometimes become tools for concealing income or marital property.
A spouse may attempt to move assets overseas to prevent them from being included in the division of property. Understanding what offshore accounts are—and how they can be used—is an important first step in uncovering hidden assets during a high-net-worth divorce.
Warning Signs That Your Spouse May Have a Secret Bank Account
Some red flags that may indicate your spouse is hiding a bank account include:
- Unexplained withdrawals
- Large, frequent, or unusual transactions
- Secrecy around travel
- Recent changes to account access
If one spouse has primarily handled finances, it may be easier for them to hide assets.
How To Identify Offshore Bank Accounts
The first step is to identify where the accounts are held and in what name. This could be various locations. The account could be in your spouse’s name, their business, or someone else’s name. These factors make it difficult to identify these accounts.
A lawyer can help with this process by:
- Reviewing your financial records
- Conducting a thorough asset search
- Hiring forensic accountants who can search various databases to locate accounts
- Analyzing financial records and tax returns to trace funds and transfers
- Evaluating business structures
- Reviewing public records to locate assets that were purchased with secret funds
- Conducting extensive discovery requests
- Reviewing passports for travel information
- Issuing subpoenas to individuals, banks, and corporate entities to get additional information about accounts
Your legal team can review individual and joint tax returns, bank statements, and credit card statements to identify expenditures, inconsistencies, transfers, and discrepancies.
How To Value Offshore Bank Accounts
Determining the value of offshore bank accounts in a divorce can be complex, especially when funds are held in different currencies or have fluctuated over time. Your legal and financial team should:
- Review key dates: Your dates of marriage, legal separation, and divorce are critical. These benchmarks help determine which portions of the account are considered community or separate property.
- Trace the source of funds: A forensic accountant working with your divorce lawyer can help identify where the funds originated. This may include tracking deposits, transfers, and investments to see if they stem from community or separate assets.
- Analyze transactions and transfers: Investigators and financial experts can trace the flow of money into and out of the account. This helps clarify whether funds were used to purchase other assets or shifted between jurisdictions.
- Account for foreign exchange rates: Offshore holdings may involve multiple currencies. Financial experts will convert these balances into U.S. dollars using appropriate exchange rates to ensure an accurate valuation.
- Consider timing and market factors: Fluctuations in exchange rates or investment values over time can impact the account’s worth. Proper timing analysis ensures fair valuation during divorce proceedings.
Properly valuing offshore bank accounts requires a coordinated effort between legal and financial professionals.
Penalties for Hiding Assets in California Divorces
If your spouse hides assets in a divorce in California and you later find them, your spouse can face significant penalties, including financial penalties, perjury charges, and potentially the reversal of their divorce judgment.
Your spouse may be required to pay your attorney’s legal fees, and you might be granted a larger share of the hidden assets or even the entire asset.
Learn More From an Experienced Divorce Lawyer
Uncovering and valuing offshore accounts in a high-net-worth divorce takes persistence, precision, and the right legal support. Because California is a community property state, every asset must be properly identified to ensure a fair division.
When one spouse attempts to conceal funds overseas, experienced attorneys and forensic accountants can trace hidden accounts, evaluate their true value, and hold the responsible party accountable.
If you suspect your spouse is hiding assets or maintaining offshore accounts, call Berenji & Associates Divorce Lawyers at (310) 271-6290 to schedule a confidential case evaluation.
We serve all through Los Angeles, Beverly Hills, Los Angeles County, and its surrounding areas. Visit any of our offices at:
Berenji & Associates Divorce Lawyers Los Angeles Office
550 S. Hill Street STE 1467
Los Angeles, CA 90013
(213) 277-2586
Berenji & Associates Divorce Lawyers Beverly Hills Office
9465 Wilshire Blvd #333
Beverly Hills, CA 90212
(213) 277-2586