Missing $50,000 from community property

[missing50k]

What is the name of your state (only U.S. law)? CA

My very soon to be ex-wife, without my knowledge, liquidated her 401-K account from her last employer (which she was not working for at the time of liquidation) slightly less than 2 years prior to filing for divorce. Now she is gunning for full 50% of my 401-K savings.

As far as I can tell, she did not make any major purchases, pay down credit card debt, or anything else that I can tell by looking at our possessions, lifestyle or anything tangible we owned at the time of separation. Our marriage was not going good for the last 4 years of it. And she was bringing up the divorce topic every so often. So, she most probably had plans to file for it but didn't do, due to my resistance at those times.

She now says that, the money has been spent during married period and refuses to provide any documentation how it was spent. As far as I can tell, that money is sitting in bank safe deposit box or in an account belonging to her father or her sister or someone like that. But there is no proof that I can provide. The amount is supposed to be close to $50K if not more. It is not chump change that you can say I spent it here and there slowly.

Is there any way that I can legally ask her to provide information, regarding where this money went ? Or is it gone for good and she is going to get half of what is in my account too ?

 

[LdiJ]

What is the name of your state (only U.S. law)? CA

My very soon to be ex-wife, without my knowledge, liquidated her 401-K account from her last employer (which she was not working for at the time of liquidation) slightly less than 2 years prior to filing for divorce. Now she is gunning for full 50% of my 401-K savings.

As far as I can tell, she did not make any major purchases, pay down credit card debt, or anything else that I can tell by looking at our possessions, lifestyle or anything tangible we owned at the time of separation. Our marriage was not going good for the last 4 years of it. And she was bringing up the divorce topic every so often. So, she most probably had plans to file for it but didn't do, due to my resistance at those times.

She now says that, the money has been spent during married period and refuses to provide any documentation how it was spent. As far as I can tell, that money is sitting in bank safe deposit box or in an account belonging to her father or her sister or someone like that. But there is no proof that I can provide. The amount is supposed to be close to $50K if not more. It is not chump change that you can say I spent it here and there slowly.

Is there any way that I can legally ask her to provide information, regarding where this money went ? Or is it gone for good and she is going to get half of what is in my account too ?

Was she unemployed at the time that she liquidated the 401k? If so, its not as hard as you think to blow 50k over a two year period. Even if she was employed its not as hard as you think to blow 50k.

However...please explain to me how you didn't know about the 50k when it had to be included on your joint tax return?

 

[missing50k]

She was self employed at the time, and she had some income. But the kicker is, she was and still is, working as an independent book-keeper. She handled the taxes and everything. She just asked me to sign the forms and I did not question her regarding what is on the forms or what we were paying/getting as tax or refund. It is my oversight I know, but when you are not contemplating a divorce, it is not important to question your spouse's financial doings. In the hindsight, I should have done that, but I am about 4 years too late to do that.

 

[ecmst12]

What did your lawyer tell you?

 

[missing50k]

My divorce trial is in less than 2 months away and they are still to call me and schedule an appointment for strategy. I've been waiting for this since the settlement session has failed miserably (the day which I learned there is no 401K on her side)

Needless to say, I am not very happy about my lawyer but too late to change horses as the stream I am crossing is deep to my eyeballs.

 

[birdbrain53]

My divorce trial is in less than 2 months away and they are still to call me and schedule an appointment for strategy. I've been waiting for this since the settlement session has failed miserably (the day which I learned there is no 401K on her side)

Needless to say, I am not very happy about my lawyer but too late to change horses as the stream I am crossing is deep to my eyeballs.

Discovery: has your ex complied with discovery?

Your attorney should have asked for all the financial documents of all the financial accounts. If your ex does not comply, then your attorney can file a motion to compel.
Do you have a copy of your joint tax returns for the last few years?
Do you have a copy of the 401K statement that should when she withdrew the money? Did she withdraw it in cash? Or was it wired to another account?
Did you know your attorney can do an online asset search using her ssn just in case she parked the money in another account?

It sounds like she has been planning this divorce for a while and cashing out the 401K was part of that plan.

 

[Bali Hai]

Discovery: has your ex complied with discovery?

Your attorney should have asked for all the financial documents of all the financial accounts. If your ex does not comply, then your attorney can file a motion to compel.
Do you have a copy of your joint tax returns for the last few years?
Do you have a copy of the 401K statement that should when she withdrew the money? Did she withdraw it in cash? Or was it wired to another account?
Did you know your attorney can do an online asset search using her ssn just in case she parked the money in another account?

It sounds like she has been planning this divorce for a while and cashing out the 401K was part of that plan.

A man was recently released from prison after spending 14 years behind bars for failing to account for and produce marital assets. This tactic may need to be used on the stbx wife.

 

[Just Blue]

A man was recently released from prison after spending 14 years behind bars for failing to account for and produce marital assets. This tactic may need to be used on the stbx wife.

Can you provide the link to this?

 

[cbg]

Most plans, not all but most, require spousal consent before a withdrawal from a 401k can be made. Does this plan have such a requirement and if so, did you sign a consent?

 

[Bali Hai]

Can you provide the link to this?

This is a well documented case pertaining to abuse of judicial power...Google it.

 

[cbg]

This is a well documented case pertaining to abuse of judicial power...Google it.

In other words, No, I can't provide any kind of verification - you're supposed to just take my word for it.

 

[BigMouthWino]

In other words, No, I can't provide any kind of verification - you're supposed to just take my word for it.

This is a case of being too lazy to use Google, took me all of 2 seconds to find it:

http://en.wikipedia.org/wiki/H._Beatty_Chadwick

 

[gator1]

http://www.nytimes.com/2009/07/12/us/12contempt.html?_r=1

The above contempt case reported by NYT would not apply in this case (as was suggested), as that was over $2.5 million dollars that supposedly vanished.

If $50K was withdrawn two years before filing divorce (before taxes and penalties), wife claims she spent the cash, and husband can't show otherwise, the court will likely drop that issue and move on to other matters.

While you do not have much time left for discovery, you should be able to quickly discover:
(1) exactly how and on what date she received the distribution (check or direct deposit)
(2) which bank and account number it was initially deposited to, or the check cashed at
(3) the tax return for the year it should have been accounted for and see the 1099-R form detailing the amounts withdrawn

If that money does not show up on the tax return, she may have rolled it over and is trying to hide that.

You need to nail her claims down by compelling her to file sworn responses to your discovery questions on this matter.

Don't wait until trial to force her to answer questions that you should have already learned well in advance by discovery.

 

[LdiJ]

http://www.nytimes.com/2009/07/12/us/12contempt.html?_r=1

The above contempt case reported by NYT would not apply in this case (as was suggested), as that was over $2.5 million dollars that supposedly vanished.

If $50K was withdrawn two years before filing divorce (before taxes and penalties), wife claims she spent the cash, and husband can't show otherwise, the court will likely drop that issue and move on to other matters.

While you do not have much time left for discovery, you should be able to quickly discover:
(1) exactly how and on what date she received the distribution (check or direct deposit)
(2) which bank and account number it was initially deposited to, or the check cashed at
(3) the tax return for the year it should have been accounted for and see the 1099-R form detailing the amounts withdrawn

If that money does not show up on the tax return, she may have rolled it over and is trying to hide that.

You need to nail her claims down by compelling her to file sworn responses to your discovery questions on this matter.

Don't wait until trial to force her to answer questions that you should have already learned well in advance by discovery.

I think that the money is long gone. Almost half of it would have been eaten up a federal and state income taxes and it would have been very easy for the rest of it to have been spent over a two year period. However, he could absolutely call the IRS at 1-800-829-1040 and ask for income tax transcripts for the year he believes the money was taken, as well as the year before and the year after.

I honestly however do not find it credible that he did not know that she cashed in the money at the time that she did it. I think that she cashed it in to start her own business, and that he knew that.

 

[cbg]

This is a case of being too lazy to use Google, took me all of 2 seconds to find it:

http://en.wikipedia.org/wiki/H._Beatty_Chadwick

No, this is a case of someone not being willing to put his money where his mouth is. He's the one claiming such a case exists - it's up to him to provide the backup, not up to everyone else to go looking for support for his claim.

Particularly since this case is not on point to the situation.