Tag: Divorce Fraud

Another Case of Fraud and Divorce

A 77-year old Tampa businessman filed to divorce his 26-year-old wife who may have tried to steal $1,000,000.00 from him. Is this yet another case of divorce fraud, and if so, what can be done? The Husband’s divorce attorneys at Sessums Black Caballero Ficarrotta will have to find out.

Divorce Fraud 3

A Tampa Bay Buccaneer

Court records show that 77-year old Richard Rappaport’s attorney filed an action for dissolution of marriage against his 26-year old wife, Lin Halfon, on Friday, Jan. 10. The couple was married in Sarasota in August.

Halfon won’t have an easy time getting to divorce court because she’s been incarcerated for a month at the Hillsborough County Jail on Falkenburg Road.

She is facing charges of money laundering, organized fraud, exploitation of the elderly and conspiracy to commit money laundering.

His wife, Ms. Halfon, has been charged with money-laundering, organized fraud and exploitation of an elderly person after being arrested at Tampa international airport in Florida.

Florida Divorce Fraud

I’ve written about various aspects of divorce fraud before. In Florida, courts distribute the marital assets, such as bank accounts, between parties under the premise that the distribution should be equal, unless there is a justification for an unequal distribution.

Some of the factors to justify an unequal distribution of the property include things like the financial situation the parties, the length of the marriage, whether someone has interrupted their career or an educational opportunity, or how much one spouse contributed to the other’s career or education.

Another important factor is whether one of the parties intentionally dissipated, wasted, depleted, or destroyed any of the marital assets after the filing of the petition or within 2 years prior to the filing of the petition.

Dissipation of marital assets, such as taking money from a joint bank account, happens a lot. Trying to cash a million dollar check at a payday loan store . . . less so. In both cases, the misconduct may serve as a basis for assigning the dissipated asset to the spending spouse when calculating equitable distribution.

Misconduct, for purposes of dissipation, does not mean mismanagement or simple squandering of marital assets in a manner of which the other spouse disapproves. There has to be evidence of intentional dissipation or destruction.

When it’s Friday and Payday!

This divorce fraud case may also get entered into the world’s dumbest criminal’s museum. She’ll join a trio of drug thieves who broke into a Florida home, snorted the contents of three jars – which were in fact urns – only to discovery they’d inhaled the remains of two cherished dogs.

The Wife went to a payday loan company called, Amscot, and tried to cash a $1 million check with both of their names on it. Court documents said Rappaport’s wife returned to the bank with three checks in the amount of $333,000. The police investigation began after an employee refused to cash the checks.

After being notified by investigators, Rappaport said he wanted to give his new wife the benefit of the doubt and did not want her to be deported. When asked later if he felt he was the victim of fraud, Rappaport told investigators, “yes.”.

The Wife’s defense attorney Todd Foster said he plans to file motions asking for bond and evidentiary hearings and asked:

“Can a wife steal from her husband? Is that a crime? We’re looking at that.”

Rappaport’s daughter said in an arrest affidavit that his family members were unaware of the marriage and believed Halfon was ‘conning’ Rappaport due to his age” according to the arrest affidavit.

The Wife’s attorney claims it “was a valid marriage” and that they loved each other.

Tampa’s Channel 8 article is here.

The Great Chinese Divorce Fraud

Divorce rates are rising in China for many reasons, but one recently uncovered reason is found in a family which divorced 23-times in one month! The new Chinese divorce fraud is the hot ploy to avoid Chinese property laws and make money.

Chinese Divorce Fraud

23rd Time is a Charm

Unlike older generations who may have settled for an unhappy marriage, divorce is no longer socially taboo in China. That may have led to one family in the city of Lishui to take the new divorce fraud to extreme lengths, churning through 23 divorces and weddings in a month.

Divorce is becoming simpler in China. Couples can either register a divorce with the civil affairs authority, indicating they have agreed to go their separate ways, or they can sue for divorce through the courts, which can rule on custody of children and how to dispose of any assets.

In the first six months of this year, 1.85 million couples registered for divorce with the civil affairs authority alone, an increase of more than 10 per cent compared with the same period last year. Three decades ago, in 1986, 460,000 couples registered their divorces with the civil affairs authority. By 2016, that annual number had risen to 4.15 million.

However, the Lishui family was not divorcing for typical reasons. The Chinese government has limited each household to a maximum of two apartments. Other notable policies allow potential home buyers who don’t already own property to make much lower down payments as well as enjoy lower tax and mortgage rates.

The new divorce fraud was aimed at getting more money from the government and developers when the Lishui family house was demolished for a new development. Under the system, each member of the household would be entitled to 40 square meters of space in the new development.

In China though, the preponderance of fake divorces in any given city may indicate the failure of real estate policy at the local level.

Florida Divorce

I’ve written about no fault divorce before. No-fault laws are the result of trying to change the way divorces played out in court. In Florida no fault laws have reduced the number of feuding couples who felt the need to resort to distorted facts, lies, and the need to focus the trial on who did what to whom.

Florida abolished fault as grounds for filing a divorce. Gone are the days when you had to prove adultery, desertion or unreasonable behavior as in England.

The only ground you need to file for divorce in Florida is to prove your marriage is “irretrievably broken.” Additionally, the mental incapacity of one of the parties, where the party was adjudged incapacitated for the prior three year, is another avenue.

The Great Fraud of China

It all started with Mr. Pan, who lived in the house, remarrying his ex-wife, and allowing her to qualify for the compensation plan. Two weeks later, he divorced her and married his sister-in-law, adding her to the plan. On it went, with each new family member enlarging the amount of space to be awarded as compensation, until government authorities discovered the house suddenly was home to 13 people, and promptly arrested 11 of them.

While it’s an extreme case in property-obsessed China – where would-be home buyers have to navigate a shifting array of property curbs – it’s probably more understandable given home prices in Lishui have surged as much as 31% in the past two years.

According to the compensation policy, people living in the village slated for renovation — even those who were not property owners — would be given minimum compensation of one 40-square-meter apartment as long as their household registration, or hukou, had been filed within the village by April 10.

When interrogated by police, Pan’s father — who had been party to the sham marriages and divorces himself — said he had assumed the family’s actions were legitimate since they had not violated China’s marriage law. “In doing this, we were just trying to get more compensation.”

According to the chief marriage lawyer at Beijing Yingke Law Firm:

Just because a person is following one law doesn’t mean they’re not breaking another. The family used a legal avenue to achieve an illegal end. The marriage law doesn’t forbid marriages and divorces — but in this case, the family used marriages and divorces as a means of committing fraud. While they didn’t violate the marriage law, they acted against the criminal law.

In April of this year, home buying policies in select urban areas were further tightened. Now, regardless of whether a divorced person is buying their first or second property, banks will evaluate them based on both their property ownership status and mortgage records — meaning even if they have no property registered in their name, an apartment they’re hoping to purchase can still be considered a second home, subject to a higher down payment and mortgage rate, if they have made previous mortgage payments.

The Bloomberg article is here.

 

New Divorce Fraud Case

A Texas man is wanted by authorities for divorcing his wife — apparently without her knowledge or consent. This new divorce fraud case is another example of how careful you need to be in this stressful area of law.

New Divorce Fraud

Divorce Fraud in the Lone Star State

Paul Nixon, 51, allegedly broke off his marriage from his wife using forged documents behind her back, authorities claimed. Nixon’s wife told investigators on May 14 that her husband:

“filed for divorce and completed the entire proceedings without her knowledge or consent and that the court had already completed all hearings and filed the final divorce decree.”

Nixon, of Harris County, submitted “several forged documents and false information” to a district court, “including a forged waiver of service” and a forged signature from a notary public in an effort to divorce his wife,” according to a press release posted on the constable’s Facebook page.

Mark Herman of Harris County Constable Precinct 4 said on Facebook that Paul Nixon committed aggravated perjury when he went through the divorce process without his wife’s consent.

According to Herman, authorities received a call on May 14 from a woman who said her husband had allegedly completed the divorce and that a court already filed the final decree.

Through the investigation, authorities found that Nixon forged documents and submitted false information to the court. He also allegedly submitted a waiver of service with a forged signature from a notary.

Florida Divorce Fraud

I’ve written about various aspects of divorce fraud involving property. In Florida, courts distribute the marital assets, such as bank accounts, between parties under the premise that the distribution should be equal, unless there is a justification for an unequal distribution.

Some of the factors to justify an unequal distribution of the property include things like the financial situation the parties, the length of the marriage, whether someone has interrupted their career or an educational opportunity, or how much one spouse contributed to the other’s career or education.

Another important factor is whether one of the parties intentionally dissipated, wasted, depleted, or destroyed any of the marital assets after the filing of the petition or within 2 years prior to the filing of the petition.

Dissipation of marital assets, such as taking money from a joint bank account, happens a lot. In those cases, the misconduct may serve as a basis for assigning the dissipated asset to the spending spouse when calculating equitable distribution.

Misconduct, for purposes of dissipation, does not mean mismanagement or simple squandering of marital assets in a manner of which the other spouse disapproves. There has to be evidence of intentional dissipation or destruction.

Texas Hold ‘Em

Back in Texas, Mr. Nixon, is wanted by police for aggravated perjury after he allegedly submitted forged documents, divorcing his wife without her knowledge, officials said.

Nixon’s wife “was very surprised,” Constable Mark Herman told the New York Post. “In this particular case, the gentleman decided to go through a divorce but the only problem is, he left his wife out of the process. And that’s a violation of the law here in Texas.”

The constable said Nixon’s wife “started finding things showing that he was spending money on jewelry, so she confronted him and he told her that they were actually divorced.”

Nixon and his wife were only married for a “couple of years” before he moved forward with their divorce, without her. Nixon now faces up to 10 years in prison if he is found and convicted. As far as his marriage goes, no new divorce proceedings have been filed.

The Fox News article is here.

 

 

Divorce Fraud: Student Loans

This is kind of scary for Halloween. Market Watch has an interesting article about a husband who paid off his wife’s student loans during their very short marriage, and his wife thanked him by filing for divorce after a mere 24 months of marriage. Was the husband the victim of divorce fraud, and tricked into paying off his wife’s student loans?

divorce fraud

Tricked or Treated?

As the Market Watch article reports: “[b]efore I married my wife two years ago, she had huge amounts of debt to her name, including large amounts of student loans. After we married, we diligently almost paid everything off, helped by my salary being three times that of my wife.”

She recently asked for a divorce, saying she was taking the house and my retirement. My question is: Does the fact we paid off her debts she held before get spread evenly? Had I not paid all of her debts our net worth would be near the same with a better outcome for me.

We’ve only been married a few years, and frankly I can’t help feeling taken advantage of. The only advice I can find discusses whose responsibility the student loans would be, but now it just seems that she got me to pay all of her debts, and got some new stuff, while I threw away years of my life.

Please tell me there’s hope.

Florida Divorce and Student Loans

Is there hope for Market Watch’s husband?

I’ve written about student loans in the past. Florida is an equitable distribution state. The initial premise behind an equitable distribution of marital assets and liabilities – such as student loans – is equal distribution.

However, when proper justification is shown, a family court judge may make an unequal distribution.  The burden is difficult. A distribution of marital debts, whether equal or unequal, must be supported by factual findings and based on substantial competent evidence. The rationale for the distribution also has to be disclosed by the judge.

As a general proposition, student loan debt incurred during the marriage is a marital liability. So, in the absence of findings supporting the unequal distribution of a student loan debt, marital student loan debts must be equitably distributed between the parties.

The fact that the husband will not receive any benefit from his ex-wife’s education because of the divorce is not a factor to be considered when allocating a marital debt for student loans.

In sum, absent some other justification for an unequal distribution, controlling case law in Florida will usually prohibit a family court judge from awarding student loan debt incurred during the marriage solely to one party or the other.

Out of Luck?

As Market Watch reports, divorce after two years is a tough break, “especially given all the help you gave your wife with her student debt. That’s a particularly unusual kind of debt, in that it’s virtually impossible to discharge.”

The article concludes by noting that “[t]he best thing you have going for you right now is your honest intentions going into this marriage and your (good) behavior throughout. Having examined all the details, the judge may not be able to say the same thing about your wife.

The Market Watch article is here.

 

Divorce Surprises

According to a recent survey, 46% of divorced women reported their divorce brought unexpected financial problems. What are some of the divorce surprises you can run into if you find yourself in family court?

Divorce Surpises

In the study, 1,785 adult women were surveyed across three stages: those with divorce “on the horizon,” those in the midst of divorce, and those who described themselves as “divorced and determined.”

Divorce Tricks

Slightly related, I recently wrote about dirty divorce tricks which were in the news. These tricks should serve as a warning, not as a “how-to course”, because they can seriously backfire. A couple of common tricks to watch out for include:

  • Refusing to pay household bills until a court forces you to in an attempt to “Starve Out the Other Spouse”.
  • Waiting until the latest possible day to pay support money, even if you’ve got the money to send. Never mind the children.
  • Asking the court for sole custody of the children when you only want to share custody.

These tricks are not the kind of divorce surprises reported in the survey though. The above tricks are the result of planning to harm the other side.

Divorce Surprises

The surprises from the survey are very different. The divorce surprises have nothing to do with fraud, or the other side failing to disclose assets. So what are they?

  • Not knowing the size of your debt, including the first mortgage, home equity line of credit, the credit card debt, 501(k) loans, and student loans.
  • Not anticipating you may have to return to the workforce
  • Assuming your child support and/or alimony would be higher or last longer
  • Assuming you could keep the marital home
  • The staggering cost of health care insurance
  • Underestimating the emotional and financial cost of getting a divorce

In general, the study found that many women find themselves in a financially vulnerable position post-divorce due to a lack of financial knowledge and planning. The study claims a solution is twofold:

  • Reinvent careers to become self-sufficient and
  • Invest to avoid outliving your money.

The Forbes article is here.

 

Divorce to Save Money?

The Hill reports that a Texas couple may divorce to save money in order to pay for their daughter’s rising health-care costs. There are times when people have divorced “on paper” to save money, but is this a good reason and does it work?

Divorce save money

Health Care Scare

Can you divorce to save money? Jake and Maria Grey may try. They told NBC’s “Today” that Brighton, the older of their two daughters, has Wolf-Hirschhorn syndrome, a developmental disability that requires 24/7 care.

“We shouldn’t have to make that sacrifice to get our child Medicaid!”

They said they spend thousands of dollars annually out of pocket, even though Jake Grey has private health insurance. The couple added that they are considering divorcing to save money so that Maria Grey can qualify for Medicaid as a single, unemployed mother.

Divorce to Avoid Penalties

I’ve actually written about a similar issue, namely: divorcing to save money on taxes by avoiding the marriage penalty tax. Back when the 2012 American Taxpayer Relief Act was passed, it raised taxes on couples making more than $450,000, and individuals making more than $400,000. As it turns out, some couples found out they could save over $25,000 a year if they divorced.

Think about that for a second. If you could save over $25,000 a year in taxes, you could take a couple’s trip to Italy, ski Deer Valley, put a little cash away for college, and still have some mad money to spend just by divorcing and turning your marriage into a long-term relationship.

Divorcing on Paper

There are a lot of risks though, known and unknown to divorcing on paper but staying together. I would encourage anyone considering a “divorce on paper” to think about a few things:

  • The impact on your relationship. I don’t know of a good way to ask for a divorce: “Honey, I want a divorce. No, no wait, come back, it’s to save big bucks . . . really!”
  • There is no fake divorce. Once the court signs the final judgment of divorce, you are divorced. Once you’re divorced, your Ex may find someone who thinks marriage is more valuable than 5% adjusted gross income.
  • IRS rules regarding your filing status have something to say. IRS publication 504 warns that if you obtain a divorce just to file as unmarried with the intent to remarry the next tax year, you have to file as married individuals.
  • State law. All no-fault states have minimum requirements for getting a divorce. Florida, for instance, requires at a minimum that your marriage be irretrievably broken before you can get a divorce.
  • In addition, there are estate planning issues, retirement and social security complications, and many other issues besides the mere tax savings.

Most people who marry do so forever, and with the sincere intention of honoring their vows. Is the money worth it?

Jake Grey’s $40,000 salary is too much for the family to receive Medicaid, and Maria Grey said they are No. 60,000 on the list to receive state assistance.

It’s drowning us to try to keep up with her medical expenses. We’ve done everything we can do to try to keep her afloat, and we’re going to reach a point where we can’t do it and we won’t have another option. We don’t know what to do.

The Hill article is here.

 

Hiding Money in Divorce

“Martin” actress,Tisha Campbell-Martin, is accusing her estranged husband of hiding money during their divorce proceedings. Hiding money, especially when you are going through a divorce raises all kinds of concerns . . . for both parties. What are some of the consequences?

hiding assets in divorce

Campbell-Martin filed legal documents in court – which were obtained by TMZ – claiming her husband Duane Martin was hiding and misappropriating money while they were married.

It’s unclear how much money she thinks he was hiding from her or what specific remedies she is seeking.

Hiding Assets in Divorce

In Florida divorce, judgments and marital settlement agreements can be set aside on various grounds, including fraud. Divorce fraud has become very common, and I’ve written on the subject before.

One of the areas ripe with fraud is hiding money in a divorce. In certain cases, Florida allows you to challenge and vacate or modify a marital settlement agreement if the agreement was based on things like fraud, deceit, duress, coercion, misrepresentation, overreaching.

Additionally, Florida courts have allowed challenges to agreements where the marital settlement agreement makes unfair or unreasonable provision for the challenging party given the circumstances of the case.

Judgments may also be overturned because of fraud and fraud on the court. The thinking is that cheaters should not be allowed to prosper, and it has long been central to our legal system.

Florida rules of court expressly allow you to get some relief from a judgment if it was the product of fraud, misrepresentation, or other misconduct of an adverse party.

Courts have available to them all kinds of sanctions, in a wide variety of shapes, attempting to encompass the virtually limitless ways people in divorce manage to misbehave.

Truth or Consequences?

According to the article, actress Tisha Campbell-Martin is asking a judge to take legal action against her husband for hiding money during the divorce. She originally filed for divorce in February, after 20 years of marriage.

The couple separated in December of 2016. She is seeking alimony from her husband, and allegedly wants to block the court’s ability to award him spousal support. What are some of the remedies the judge in Campbell-Martin’s case can consider?

If you lie during the divorce process, during your deposition for example, in order to hide assets, you may have committed perjury – which is a crime. Also, if your lies are discovered by your spouse, your spouse’s attorney, or a judge, you may face severe sanctions.

Similarly, if you don’t properly report your assets on your financial affidavit or fail to disclose financial information to your spouse during a divorce, a court can order you to do so. If you defy the court when it, for example, orders you to share account balances and the location of money, you can be held in contempt of court.

The TMZ article is here.

 

Divorce Waste and Property Division

An English ex-husband has ‘come under fire’ after he admitted to burning down his marital home out of anger over his divorce. This sad event raises the issue of waste in divorce, and how courts can order an unequal property division when assets are destroyed.

Divorce Waste

‘Great Balls of Fire’

According to the Mirror, Paul Duffy appeared at Leicester Magistrates’ Court to admit to a charge of arson at his home in England. Emergency services were called to a ferocious blaze at his address in the early hours of Tuesday morning.

The house is almost completely destroyed due to arson. An investigation into the blaze found 27 individual seats of fire, two jerry cans and evidence of flammable substances and petrol.

The fire caused an explosion at the property and the house next door was damaged, although no-one was inside the address. Duffy left, but later returned to the scene, where he gave himself up to police officers and was arrested.

In interview he made a full and frank admission of his role in starting the fire.

Florida Divorce Waste

In Florida divorces, courts distribute the marital assets and liabilities between the parties every day. Judges have to start with the premise that the distribution should be equal. But is there a way ‘to fight fire with fire’ if a spouse destroys marital property?

In Florida, courts are allowed to distribute property unequally if there is a justification for an unequal distribution. I’ve written about this concept of waste, and other aspects of property division before.

One of the relevant factors courts look to is whether one of the parties intentionally dissipated, wasted, depleted, or destroyed any of the marital assets after the filing of the petition or within 2 years prior to the filing of the petition.

There are many examples, besides arson, of spouses dissipating or wasting assets. Other instances of people ‘pouring gasoline on the fire’ include spending money buying a girlfriend jewelry or lingerie, gambling losses, and drug usage.

Some people get ‘fired up’ over their divorce, and would rather lose the money outright than split it with their spouses.  Where this kind of marital misconduct results in a waste of marital assets, it can serve as a basis for unequal division of marital property.

‘Burning down the house’, one of the largest assets in a marriage, would be a good reason to justify an unequal distribution of the property in divorce. It’s Florida’s way of saying: ‘if you play with fire you’re gonna get burnt.’

‘Fire Away’

According to reports in England, the husband had left the area after starting the fire but later returned to the scene, where he gave himself up to police officers and was arrested.

The house was not insured. The house was ruled to be unsafe and had to be demolished later that day. The husband is now facing jail. Clearly, the husband has jumped ‘out of the frying pan into the fire.’

The Mirror article is here.

 

Do you Divorce or Annul?

In a divorce fraud case from England, Neil Rattue was married for 15 years before he was found to have forged his divorce decree, and illegally married another woman. Do his two ‘wives’ file for divorce, or, like rats leaving a sinking ship, annul their marriages?

divorce or annul

Smell a Rat

Rattue invented a sickness, claiming he had “terminal cancer” to keep his double life hidden from both ‘wives”. The court in the UK heard a victim statement from his first wife, read out by the prosecutor, who said she felt like her husband had ‘stolen her life’ from her.

Why did he not ask me years ago for a divorce or when he met his new wife? Instead he was leading a double life. I have spent the last 19 years living with my mum as he left me with no other option. I am paying for this both mentally and emotionally. He has stolen my life from me.

Though he stopped seeing his first wife in 2001, he dutifully continued to call her daily for 17 years to ask how she was and discuss their debts, which she was paying off.

A court previously heard his first wife had paid off £30,000 of debt, from credit cards and loans taken out with Rattue, but still had a staggering £37,500 to be paid.

 Florida Divorce and Annulment

What if this took place in Florida? I’ve written about divorce and annulment in Florida before. Florida does not have a statute authorizing annulments. The decision to divorce or annul a marriage will depend on certain facts.

Annulment has a history beginning in England, and if King Henry VIII had been able to secure an annulment from the Pope, England might have remained a Catholic country. Today, annulment may best be known for rescuing Britney Spears from an ill-advised alcohol-related Las Vegas “bender.”

Because Florida is one of the handful of states that has no annulment statute, annulments in Florida are purely a question of common law, decided pursuant to the inherent equitable powers of the circuit court.

The historical common law “impediments” to marriage traditionally fell into two general categories: lack of consent and lack of capacity. This is substantially still the case law in Florida.

Lack of consent would include, for example, people who are related within certain degrees, and minors without parental consent.

Lack of capacity, is exactly the situation the Rattue wives are in. Lack of capacity includes marriages involving fraud, mental illness, sham marriages, and shotgun weddings.

While none of the “marriage” statutes in Florida specifically address purported marriages between one person and another person who is already legally married to a third party, bigamy is, of course, a crime. Bigamy raises the question: do you divorce or annul the marriage?

Whether to divorce or annul will depend on the legality of the marriages. Given that Rattue was never legal divorced, he forged his divorce decree, his second marriage would not likely be recognized in Florida.

This is not only a surprise for the first wife but can be devastating for the second wife. But, it also means his second wife would have to file for an annulment. His first wife, who was legally married, could file for divorce.

Ratatouille

According to the report:

The matter was not heard by a family court judge hearing whether to divorce or annul the marriage(s), but in criminal court. Judge Richard Parkes QC said Rattue had been ‘cowardly’ and ‘deceitful’ in maintaining his marriage to his first wife, despite having started a new marriage and raising children without his first wife even knowing.

Salisbury Crown Court, Wiltshire, heard how Rattue had met his first wife in Wiltshire in 1980 and they were married three years later. Rattue, who often worked away, then met his second wife while traveling.

The pair, who married on October 3, 1998, lived together in York, North Yorkshire, having two children together. Prosecutor Phillip Warren said Rattue had taken a friend’s divorce certificate without him knowing, before using it to forge his own.

Eighteen months ago, he would still phone me at work every day where he would ask me how I was. He still made me pay off all the money. He said we have got to stay married for the purpose of the loan and I believed him. Little did I know, it was because he had already forged our divorce certificate. This has been a prison sentence since 2001 when he left and stole my life from me.

The Mirror article is here.