When you think about “hidden assets” and secret stockpiles of wealth that your spouse may be hiding (so that they can avoid splitting any of those assets with you in the divorce), your mind probably goes first to “offshore accounts.” Maybe you even think about modern inventions, e.g., Bitcoin, that are uniquely designed to evade detection.
Have you considered asset trusts in South Dakota? A lawsuit involving a Texas billionaire has cast a spotlight on these trusts that make it easy for wealthy people to hide their income and property from everyone else — including their own spouses. According to reports, South Dakota is actually becoming a “mini-Switzerland” when it comes to stockpiling assets from prying eyes.
According to the suit, the billionaire and his wife amassed a lot of properties and assets during their 30-year marriage — everything from vacation homes to some of Marilyn Monroe’s clothing and jewelry. When the husband filed for divorce in 2017, however, his wife discovered that he’d allocated much of their possessions (including the couple’s tableware) to trusts.
The wife would like her share. The husband claims that the trusts own everything, not him, so there’s nothing to divide. That may leave the wife without anything after her legal bills are paid — which is a pretty big financial hit to take.
South Dakota’s trust laws have made it a perfect shelter for riches — and it’s estimated that somewhere between $250 billion and $900 billion is sitting in trusts in that state. The trusts are being used by everyone from foreign nationals hiding money from their government to wealthy folks seeking to hide assets from their mates.
In this case, the husband seems to have purposefully started to transfer assets in the trusts after he started planning for divorce, once he was involved with another woman. South Dakota law doesn’t require any notification to spouses (or creditors) of the changes — so his wife was left utterly unaware until the divorce was filed.
If you’re involved in a high-asset divorce, you may have trouble figuring out where your spouse hid all of the money, so it’s smart to keep these facts in mind. It may help inform your search — and your legal tactics.