One man moves billions to shield assets

On Behalf of | Jun 2, 2020 | Divorce

In every Indiana divorce, there is a point in the process where the two spouses will need to exchange financial information, including data about the types and values of their assets. One of the problems that some couples face is that one spouse will either try to hide or undervalue assets. Courts do not like this, but it can sometimes be done pursuant to the laws of a state.

South Dakota has become a haven for assets that people are trying to shield thanks to its permissive trust laws. When assets are moved to the state, they became almost entirely secret and practically untouchable. This has drawn money from domestic and foreign billionaires who are trying to shield assets from things such as divorce or even their own governments.

One billionaire was planning to divorce his wife. He had moved nearly all of the couple’s assets out of his name and into South Dakota trusts. When the wife learned of the divorce, she was stunned to learn what once was a multi-billion-dollar estate had been reduced to $12 million. She is suing her husband, but she faces long odds because the trust is completely legal under South Dakota law. Once the money is moved to the state, the trust is permanent, and the assets that are in the trust enjoy very strong protections under state law.

When one spouse is siphoning off part of the marital estate or is undervaluing assets, a divorce attorney may take the matter in front of a judge. Courts look upon hiding assets with extreme disfavor and may punish the spouse who is engaging in such a maneuver. An attorney may be able to detect that the other spouse is hiding money by reviewing the financial information that they provide when the two spouses exchange their data.

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