Spouses may attempt to hide assets during divorce for numerous reasons. It is not a new issue, either: it has occurred throughout the years, causing strife for many who relied on asset division to get through the financial struggles of the split.
These days, more people have turned to cryptocurrency and other digital forms of currency to hide assets, as well. But why and how do they do so?
Why use cryptocurrency?
CNBC takes a look into the use of cryptocurrency to hide assets. First, many people have turned to digital currency as a way to handle activity that they do not want to be traced as easily as traditional forms of currency. Until recent years, the cryptocurrency did not have a strong public watch on it. It also did not have the same level of scrutiny from the IRS and other related government services.
Thus, people attempting to hide assets began turning to it as a way of evading even forensic financial analysts. Until recently, not even many divorce attorneys knew about this trend.
The red flags
However, many individuals still give themselves away and have the same red flags as any other spouse hiding assets. For example, many will change their spending behaviors. In the case of digital asset hiding, they will likely cut back to a potentially severe and notable degree on their purchases and expenses.
They may also grow fiercely protective of their electronics and financial documents, as this is a way to see that something is amiss. It is possible to gain an affidavit that allows one to search digital devices in the event that one suspects a spouse of hiding assets. This is a good way to start an investigation.