New York housewife discovers husband hid $500,000 in Bitcoin in divorce battle

Cryptocurrency is becoming increasingly popular as a method of hiding assets during a contentious divorce, sparking an evolving game of cat and mouse with forensic investigators, according to a new report.

In one case, a suspicious New York housewife seeking a divorce found 12 bitcoins, then worth around $500,000, in a secret crypto wallet maintained by her ex-husband, CNBC reported Saturday.

The woman became suspicious because her husband, who made about $3 million a year, was not disclosing many assets in the divorce case, prompting her to hire a forensic accountant.

“I know bitcoin and things like that. I just didn’t know much about it,” said the woman, who asked not to be named for fear of reprisal.

“It wasn’t even a thought in my mind, because it’s not like we’re talking about it or making investments together. … It was really a shock.

While hiding assets is nothing new for those looking to avoid a court judgment, the rise of cryptocurrency has created new headaches for divorce attorneys.

“I still think the law is trying to catch up with this new form of currency, even though it’s been around for a while,” Florida family law attorney Kim Nutter told CNBC.

As financial tricks involving crypto have evolved, so have the tools of those tasked with tracing marital assets.

Some forensic accountants now specialize in tracking cryptocurrency, using sophisticated analysis of blockchain transactions to trace hidden assets.

The devious spouses have also developed new tactics, including the use of anonymized digital currencies such as Monero, which would be nearly impossible to trace.

Another favorite trick are “cold storage” wallets, in which a cryptocurrency password is stored on a physical device like a USB drive, which is easily portable and inaccessible online.

So-called “financial infidelity,” however, is not limited to divorcing couples.

A February survey by financial news site Bankrate found that 39% of Americans have committed some form of “financial infidelity” against their romantic partner.

Among those who are married, in a civil partnership or living with their partner, 12% have a secret credit card, Bankrate found.

Meanwhile, 11% accumulate big expenses that their partners are unaware of, 10% have hidden debts and 9% have a secret savings account.

An interesting note from the study is that younger generations seem to be hoarding the biggest financial secrets.

Among Gen Z, 63% have withheld financial details from their current partners, along with 54% of Millennials – two figures far higher than with Gen X or Baby Boomers.

“It used to be that couples were expected to totally associate their financial lives, but I find that really changes with younger clients,” Amanda Clayman, a financial therapist in Los Angeles, told Reuters following the incident. ‘investigation.

“A lot of young people don’t necessarily have that level of integration. They may not even see these things as secrets.