When it comes to finances, people generally prefer to part with as little money as possible. Divorce proceedings can become particularly acrimonious, and may lead individuals with significant asset levels to employ cunning measures to protect their wealth. In California, each party is required to submit a separate property assessment, fully disclosing all details of his or her own assets and liabilities, to ensure an equitable settlement. Recent advances in technology may also create the potential for an increase in levels of hidden assets.
Bitcoin is a digital currency that is independent of government and financial institutions, and allows investors to retain complete anonymity. It is not illegal to hold investments in this manner, however, an individual who has resolved to hide any part of his or her wealth may be tempted to use such means to reduce their apparent holdings. Making the choice not to declare a Bitcoin portfolio would be illegal, as the declaration one signs when completing an individual property assessment contains within it the statement that it is a true account.
If one suspects that their spouse has followed such a path it may still be possible to track down the paper trail, leading from known funding sources such as banks or employers, showing the conversion into Bitcoin currency. Once the transaction has taken place, the trail is extremely challenging to follow, and becomes even more complex if Bitcoin funds are held internationally. If one can find the necessary proof that exchange into Bitcoin took place, it may be sufficient to force the other party’s hand into declaring its value.
It may require a great deal of patience, and a lot of investigation, to uncover the full value of an individual’s hidden assets. If those assets are of significant enough value, it may be well worth the additional effort. California residents faced with such a task may wish to consider seeking appropriate advice and assistance in utilizing available technology and legal processes to their own advantage.
Source: dailyfinance.com, “Bitcoin: The New, High-Tech Way to Hide Assets in a Divorce“, Robert Pagliarini, June 16, 2014