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Recently, our  family law attorneys in Brooklyn wrote about ways to uncover hidden assets that your soon-to-be-ex might be trying to hide.

Now, the case of a Suffolk County woman illustrates the importance of making this a priority before the divorce settlement is reached and a decree is finalized. The case of Bellino v. Bellino, Superior Court of Suffolk County, illustrates judges have little sympathy for those who fail to conduct due diligence in uncovering all assets in the course of a divorce proceeding.

In this case, the former wife (the plaintiff) had requested that the court grant an injunction on numerous bank accounts, trading accounts and investment trust accounts held by her ex-husband (the defendant), claiming he hid them from her during the course of their union. Some of these accounts were offshore, and the wife claimed she had no knowledge whatsoever that her ex owned them during the course of their marriage.

The defendant filed a cross-motion, indicating that the claims made by the ex-wife were false and inflammatory and demanding that she be forced to cover his cost for defense fees, as well as be made to pay sanctions for bringing the action in the first place.

Although the judge initially granted a temporary restraining order on the bank accounts, he ultimately denied both parties’ requests in their entirety.

The couple first proceeded with divorce actions back in the spring of 2009. Over the course of several months, both parties agreed to a settlement of four stipulations, which included a custody and parenting time agreement, a child support and spousal maintenance agreement, a resolution as to equitable distribution of property and the distribution of retirement assets.

The divorce was finalized in the spring of 2010, with the four stipulations incorporated into the final judgment.

However, the plaintiff filed a new action in January 2012, alleging that the four stipulations reached were the result of “financial blackmail,” as well as improper and inadequate discovery of assets. Specifically, she said there was an estimated $3.3 million in undisclosed assets to which she would have been entitled to access in the divorce – had she known about it.

In bringing her request for an injunction, the ex-wife listed numerous accounts in the U.S., as well as England and the Bahamas. Based on the existing balances, the plaintiff said she was entitled to at least $1.6 million in liquid assets, which she unknowingly waived. She argued that the stipulations reached represent an “unconscionable bargain that no honest or fair person would accept” in light of the new information.

The restraining order, she said, was necessary to prevent the defendant and/or his agents from removing, withdrawing, selling, transferring or disposing of those assets after it became apparent she knew of them.

The defendant countered that the plaintiff’s claim was a “sham,” and that the report given by the plaintiff to the court did not reflect accurate balances in the existing accounts. He pointed to several inaccuracies, including one line item that indicated a Bank of America deposit account that was in fact a credit card account.

Further, he asserted that his income was only about 25 percent of what it had been prior to the collapse of the world market – and his marriage. He had been forced to borrow from his retirement accounts, the equity in his home and even cash out a life insurance policy in order to make ends meet.

In response, the plaintiff provided an updated list of assets to the court.

However, the judge ultimately denied her request, stating that the facts of the case were in sharp dispute and the plaintiff had failed to convincingly establish her position – specifically that the four stipulations were reached as a result of fraud on the part of the defendant. The judge noted that the plaintiff had the means and opportunity to thoroughly research the defendant’s existing assets prior to the dissolution of the marriage, and did not do it.

If you are contemplating a divorce in Brooklyn, call our offices at (718) 864-2011.

Additional Resources:

Bellino v. Bellino, April 12, 2013, Superior Court of Suffolk County

More Blog Entries:

Uncovering Hidden Assets in Brooklyn Divorce, Nov. 16, 2013, Brooklyn New York Divorce Lawyer