The rise of digital currencies throughout the world are giving wives and husbands in Illinois a brand-new way in which to hide their money during divorce proceedings. The reason these new currencies are so attractive to those aiming to conceal their marital assets is that they offer anonymity and privacy. Using these currencies, such as Bitcoin, may be especially tempting for those who have a lot to lose in a high-asset divorce.
Bitcoin received unprecedented attention toward the end of 2017. That is when it experienced soaring value and a boost in its level of popularity. In addition, it is expected to change the game in many financial situations, including hedge fund investing as well as the division of assets during divorce.
During a divorce proceeding, spouses must exchange their financial information. However, one of the spouses might attempt to conceal liabilities, property or liquid assets to his or her benefit. The problem is that this spouse’s success may end up being short lived, as divorcing spouses have to fill out sworn statements of their net worth, listing all of their liabilities. Attorneys typically look over bank statements as well to search for discrepancies, so if a spouse purchased Bitcoin or another type of digital currency, the related withdrawal will appear on his or her bank statement, thus leading to questioning.
The best scenario when going through a high-asset divorce is for both spouses to be honest about their assets and liabilities and then work together at the negotiation table or during divorce mediation. These are alternative processes to traditional divorce litigation, which may be more stressful. An attorney can offer the guidance needed to navigate these processes in a personally favorable way in Illinois.
Source: bna.com, “Bitcoin the New Mattress Full of Cash for Divorce Cheats”, David McAfee, Dec. 28, 2017