Transcription:
Chris: Hi. My name is Chris Montgomery. I’d like to welcome you to this week’s episode of TNtv. This is our final part in our three-part series on how technology has impacted family law, specifically in the area of divorce. And, once again, I have with me Jonathan Marks from The Marks Law Firm.
Jonathan: Thanks for having me, Chris.
Chris: Yeah, now that we’ve explored all the different avenues as far as prenups and social media and everything else, let’s talk a little bit about something else you had mentioned at the offset, which is assets, specifically hiding them. Obviously, with technology, we have bitcoins now. And that is a completely different type of currency that the legal system probably really hasn’t had to address too terribly often up to this point. So, could you go into a little bit about, maybe, what people were doing to hide assets or, maybe, some of the effects and impacts this can have?
Jonathan: Sure. So, you know, the old days, even like you’d see on a TV and movies, you’d hear about the person who would take the funds and put them into the Cayman Islands, and no one would ever discover that. Well, today, you know, the technological world has made it easier to do something like that. And so, the Bitcoin has been, you know, the most popular of the current technologies of how someone is now hiding the asset. So, say you have a bank account at Bank of America, and all of a sudden you’re noticing that certain funds are disappearing in large chunks, not super-large chunks, but large enough chunks that you start to wonder, “Where’s that $500, where’s that $1,000 going to a location that I’ve never heard of before?” So what you’re seeing is that the bitcoin technology, which is basically just a peer-to-peer network of a cryptocurrency…so, in essence, you are sharing with someone in the same way you see with Napster sharing music. But, in essence, you are sharing money with someone on a peer-to-peer network. It is not regulated by the government. There is no way to track this. And so, because it’s encrypted, hence the cryptocurrency, the only person that has the key to open up where this currency is is someone who owns the bitcoin encrypter.
So, as a result of it, the technology itself is hiding the asset. It’s being sent across a peer-to-peer network and you’re seeing it disappear in smaller chunks. Usually one bitcoin is about $500. And so you just, sort of, see it disappear. If someone really were smart, and they were saying, “You know, I’m not quite ready to go through this, but I wanna start secreting funds. So, maybe I have plenty of attorney’s fees or I have plenty of funds available to start my life over when I’m ready to go through this divorce process.” They may be moving these funds in a manner that just doesn’t pop out on a bank statement each month. And so, as a result of it, when you start to look through bank records, and you see transactions that don’t necessarily go to Visa or to the mortgage, you start to wonder as to whether or not somebody is using this peer-to-peer network, especially in a high-asset divorce, as to whether these large chunks of money are disappearing then into the Bitcoin. Because it’s not like you can send a subpoena to have them discovered. The only thing you can do is, basically, ask the other spouse either in court or through some form of discovery, as to whether this is going on. And if they lie, it makes it really difficult to come and trace those funds.
Chris: So, I mean, I guess that bodes the question though. Is it legal for somebody to… And I guess it’s their money, right?
Jonathan: Easily. Well, technically speaking, they’re… Bitcoin…
Chris: I mean, it’s legal to invest in Bitcoin. I understand that.
Jonathan: It is. It’s legal to do that.
Chris: But in terms, or in the context that we’re talking about here?
Jonathan: Well, it depends. You know, like everything in technology, the law is evolving with the technology. So could one determine later on that this is just another form of money laundering? Absolutely, I mean, in its most basic form, you know, the individual who is doing this with only the marital situation, is just money laundering to avoid it being part of an asset pool to be divided within the divorce. And you’re starting to see courts around the country start to look at these things, and start to punish individuals who really are trying to secrete their assets through this form of digital technology. So, you know, is it technically on the books as being illegal? No, but, you know, rest assured that if you do it and a judge finds out about that and you are caught, you are gonna get slapped very hard by that court. And you’re gonna see what would have been, maybe, a 50/50 division of assets…it’s not gonna be 50/50. And you’re gonna be punished for the severity of the misconduct
Chris: Well, Jonathan, obviously we’ve covered a tremendous amount of ground today. We’ve talked about so many different… I mean, honestly, and you coming in today, I had no idea all the different variables that go into getting divorced these days, especially the bitcoin piece and hiding assets. But, I guess, really the overarching question here is, with everything we’ve covered today, how is a court of law gonna view some of the conduct that we’ve discussed thus far?
Jonathan: Well, there’s positive and negative aspects to everything. So, you know, let’s take the positive aspect. If somebody uses technology and prove that, you know, someone was capable of working…they were capable of doing things that they were alleging was not possible in a maintenance situation, the court’s gonna view it in a positive manner. There’s nothing wrong with it. You didn’t do anything wrong, nothing illegal. It’s a positive outcome for you. It bolsters your evidence and hinders the credibility of the other spouse.
On the flip side of it, you know, look, if you really went out of your way to embarrass your spouse, you did it through the recordings, you did it through all of these misgivings, a court’s gonna look at you and wonder why you went to all this. Are you certainly looking to just punish your spouse, or, are you really looking at what’s in the best interest of the family? And, ultimately, if there are children involved, regardless of the split of the asset pool, the court is always gonna put the children first. It’s always gonna look out of what’s in the best interest of the children. So, if you did that conduct and you really went out of your way to embarrass the other spouse to the detriment of your children and they’re gonna find out about this, court’s not gonna look at it positively. And you may have spent a whole lot of time, and a whole lot of money, to do nothing but gather information that can’t be used positively within your case.
Chris: And ultimately could work against you.
Jonathan: And ultimately, it could be used against you. I mean, considering the fact that that’s gonna be the primary focus, you got to really think about that before you engage in the behavior.
Chris: So, Jonathan, thank you so much for your time today. It’s been very informative.
Jonathan: Thank you. I appreciate the time as well, Chris. Thank you.
Chris: Absolutely. And I thank you for your time as well. If you do want more information on how Jonathan and The Marks Law Firm can assist you, please don’t hesitate to contact them using the information behind me. But, once again, I appreciate your time and I look forward to seeing you next time on TNtv.