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The perils of hidden assets in a divorce

On Behalf of | Jun 5, 2020 | Firm News

For high net-worth divorces, dividing property and assets is no small feat. It requires a different level of consideration from both the attorney and the client than the average divorce, plus an understanding that there may be more acrimony in the process with more money at stake.

Sometimes, that acrimony translates into deceit. That’s what happened when billionaire couple Ed and Marie Bosarge ended their 30-year marriage.

Ed Bosarge filed for divorce in 2017, but before doing so, placed the majority of their property in a trust based in South Dakota that prevented Marie Bosarge from accessing any of the assets. He swept everything into the trust, from her jewelry to household furniture, and even all of the homes they owned, plus their private island.

Loose, secretive trusts appeal to wealthy loophole seekers

South Dakota’s trust laws allow wealth and high-value assets to be stashed without much discretion, operating similar to a Swiss Bank Account. The trust removed the status of marital property from all of the Bosarge’s assets, since ownership was transferred to the trust. It was a potentially ruinous loophole that Marie Bosarge worried would leave her with nothing, after assuming she’d walk away from the marriage with close to $2 billion.

Hiding assets from a spouse is illegal in most circumstances, and it usually doesn’t go undetected. In the case of the Bosarges, it’s unclear yet whether Ed’s deceit will be ultimately be upended by the court.

If you believe your spouse is hiding assets in a divorce, you’ll need to document the losses. Assets are hidden in a number of ways, whether it’s through creating a secret bank account, laundering money through a business or external relationship, or even selling off items.

Talk to an attorney about your options. Having assets hidden from you in a divorce is not just frustrating—it can leave you with nothing.