Women Breadwinners and Hidden Assets

The trend of increasing numbers of high-earning wives, combined with their surprisingly high divorce rate, has been reflected in matrimonial courts across the country. According to a survey by the American Academy of Matrimonial Lawyers, 56% of top divorce attorneys have seen an increase in mothers who pay child support, and 47% of those lawyers have noted an increase in the number of women paying alimony to their former husbands. American Academy of Matrimonial Lawyers, Press Release, May 8, 2012.

With the recent wave of divorces of high-power women such as Kim Kardashian, Sandra Bullock, Jennifer Lopez and Bethenny Frankel, just to name a few, even the media has taken note of what the New York Post dubbed the “women's divorce cur$e.” Theories abound as to why women breadwinners are more likely to get divorced than other women. Some conjecture that financially independent women have more freedom to leave bad marriages. Some commentators, most notoriously a fulminating all-male panel on Fox News' “Lou Dobbs Tonight,” have suggested that women breadwinners destroy marriages by upsetting “natural” gender roles.'

Several recent academic studies have shown that gender stereotypes do, in fact, play a part in this trend of increased divorce rates for breadwinner women. A May 2013 study conducted by faculty from the Booth School of Business concluded that it boils down to the fact that men just plain don't like the idea of their wives earning more than they do. Marianne Bertrand, et al., Gender Identity and Relative Income Within Households, National Bureau of Economic Research, NBER Working Paper No. 19023, May 2013. Even in this post- Lean-In world, husbands can't get past traditional notions of the man bringing home the bacon, and feel emasculated by their wives' big paychecks.'

Women, on the other hand, feel guilty for upsetting their husbands. To compensate, women take on an increasingly large share of the housework and childrearing duties as they begin to earn more than half of the household income. So, not only are these women fulfilling the responsibilities of the historically male provider role, but they are also taking on the lion's share (or, perhaps, the lioness' share) of the homemaker role, as well. This trend could explain why the Pew study found that both men and women report being dissatisfied with their marriages when wives out-earn their husbands.'

If Women Earn the Money, Why Don't They Hide It?

The fact that our social and economic realities have outpaced Americans' old-fashioned ideas about gender roles may explain why breadwinner women are more likely to get divorced, but it does not tell us why, in our experience, men are still more likely to hide assets when that eventuality comes to pass. Are men just more prone to lying about money?' It turns out the answer is “No.” A 2011 Forbes poll showed that 31% of men and women who do not maintain separate finances admit to financial infidelities. Jenna Goudreau, Is Your Partner Cheating on You Finanically? 31% Admit Money Deception, Forbes, January 13, 2011. However, the survey also revealed that women are more likely to hide minor purchases, while men are more likely to lie about major financial issues, such as the amount of money they earned or debt they owed. This gendered discrepancy in the types of lies men and women tell may find its source in yet another traditional division of labor that persists in most marriages: women control household spending, men control the family investments.

Women and men relate to money differently. A study by Prudential explains that, while women are overwhelmingly responsible for handling the household finances, they have little confidence when it comes to investing. Prudential, Financial Experience and Behaviors Among Women, 2012-2013 Prudential Research Study. Women tend to save rather than invest, and they often let their husbands make big financial decisions. While only 8% of women admit to asking their spouse to control financial decision-making, 38% of men say that they take control of financial decisions. Oddly, women breadwinners are less likely than other women to see themselves as primary financial decision-makers, even though they are more likely to keep separate finances from their husbands. No matter how smart or successful women are, they are still prone to leaving the big financial decisions up to their husbands.

We thus suspect that the differences we see in the kind of lies that men and women tell about money comes down to a question of access: Men control major assets like retirement and brokerage accounts, so they can hide the big stuff.'

We have seen this first-hand in countless cases. Smart, successful women come to us looking for money they helped to earn, but which their husbands have magically made disappear. When we ask about bank accounts and other finances, the women admit that they left all of their financial decisions to their husbands, and have never so much as glanced at a bank statement.'

We do, however, expect this to change as women's earnings continue to increase, but only if women become more confident making decisions about money. The Prudential study showed that women breadwinners are three times more likely than other women to hide financial accounts from their spouses. It also found that breadwinner wives are far more likely than other women to maintain separate finances, and hence, retain control over those finances. As with men who hide large assets simply because they control them, women who out-earn their husbands may eventually be more likely to hide money, simply because they can.'

Same-sex Marriages

None of the studies we found addressed the next big issue we see on the horizon: hidden assets in same-sex marriages. With the end of DOMA and the legalization of gay marriage in a growing number of states, we expect to see an uptick not just in marriages, but in divorces, as well. There is no reason to think that same-sex spouses will be any more truthful with one another than any other married couples. However, when traditional gender roles go out the window, many questions arise: Who manages the money? Who stays home with the kids? Who stashes the couple's savings in secret offshore accounts in anticipation of a divorce?

Although we have had some experience in this area, our anecdotal evidence is far from sufficient to provide generalizable answers to these questions. It is clear, however, that same-sex couples have to work together to come up with workable solutions for getting the bills paid, the housework done and the kids fed because they cannot fall back on gender stereotypes in the way that heterosexual couples do. A study by faculty at the University of Washington showed that gay and lesbian couples deal more fairly with one another than straight couples, with lesbians going to painstaking lengths to be egalitarian. Philip Blumenstein and Pepper Schwartz, American Couples, Money Work, and Sex, WM. Morrow Publishers, 1983.'

The study also found that in marriages of gay men, money talks. In straight marriages, men often control the family finances even if the wife makes the lion's share of the money. When two men are in the relationship, the one with the higher income is far more likely to have more financial decision-making power. This was less the case with lesbian couples than with straight couples or gay men.””

Nonetheless, early data suggests that one trend in heterosexual marriages ' women initiating divorce ' is magnified in same-sex couples. A study in Norway and Sweden, which have recognized a form of marriage for same-sex couples for nearly 20 years, found that lesbians are twice as likely as gay men to divorce. G. Andersson, et al., The Demographics of Same-Sex Marriages in Norway and Sweden, Demography, 43(1):79-98, February 2006.

Finding Hidden Marital Property

We expect a sea change in the type of marital asset searches we are asked to perform. As the number of women breadwinners who maintain separate finances from their spouses continues to increase, we anticipate a greater number of husbands approaching us to help find their wives' hidden money. As same-sex marriages become more commonplace, some of those couples will eventually get divorced and certain among them will inevitably conceal assets. We have already begun to see an increase in the number of same-sex divorce cases we handle. What we have found is that, regardless of who is hiding marital assets, we continue to successfully find those assets using the same time-tested approach we have always used.'

Whether or not your client is involved in making decisions about the family finances, he or she likely has information that can prove useful in unearthing hidden assets. We go through a meticulously detailed briefing process with all of our clients, even those who say they have never seen so much as a bank statement. This is because crucial information can come from the unlikeliest of sources.

For example, in a large percentage of our asset search cases, we find that a spouse has created secret companies. A savvy spouse will know not to name these companies after himself if he wants them to remain undiscovered, but most people are not all that creative when choosing a company name. Ask your client the names of the spouse's children or pets, the street he grew up on, or his hobbies. We once had a client whose husband named everything (including his secret companies) after classical composers. Also ask your client for the names of any companies she knows about. People are often lazy, and will repeat company names or repeat the name with a slight variation (i.e., Clearwater, Inc., Clearwater I, Inc., Clearwater Corp., etc.)”

Other crucial questions to ask your client include whether her spouse has ever been involved in litigation, and in what jurisdiction; the names of the spouse's business partners and those business partners' spouses' names; the spouse's e-mail or social media handles; where and how frequently the spouse travels; and the names of family members with whom the spouse does business or has frequent contact.'

A thorough initial briefing is important, but it is crucial that you conduct subsequent follow-up interviews with your client. As you begin to find information about the subject of your search, be sure to run it by your client. You may find names connected to the spouse's hidden companies that mean nothing to you. Your client, on the other hand, may recognize those names, and may be able to give you information about them that leads you straight to the spouse's hidden money. In short, you will have the best chances of finding the assets your client has asked you to find by asking lots of questions, keeping the lines of communication open, and, most importantly, by being a good listener.'

Anastasia Wincorn is a case manager with Charles Griffin Intelligence LLC in New York City. She received her J.D. from the Benjamin N. Cardozo School of law and, prior to joining Charles Griffin, she served as a law clerk in the Commercial Division of the New York State Supreme Court, and as an associate clerk in the U.S. District Court for the Eastern District of New York.'

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In our investigation firm's experience conducting asset searches in matrimonial cases, a clear pattern has emerged that breaks down strictly along gender lines: Women hire us to find money their husbands have hidden, while men hire us to find evidence of their wives' infidelity. This trend puzzled us, since studies have shown that women are increasingly out-earning their husbands, and that both genders are equally likely to lie to their spouses about finances. We set out to explore the causes of this pattern and whether we should expect it to change in the future, given the growing number of marriages that elude traditional gender roles.'

Breadwinner Wives (and Their Divorce Rates) Are on the Rise

The percentage of women breadwinners is growing. According to a recent study released by the Pew Research Center, women earn more money than their husbands in nearly 25% of marriages. Pew Research Center, Breadwinner Moms, May 29, 2013. Astonishingly, these breadwinner wives are a whopping 40% more likely to get divorced than women who earn less than their husbands.'

The trend of increasing numbers of high-earning wives, combined with their surprisingly high divorce rate, has been reflected in matrimonial courts across the country. According to a survey by the American Academy of Matrimonial Lawyers, 56% of top divorce attorneys have seen an increase in mothers who pay child support, and 47% of those lawyers have noted an increase in the number of women paying alimony to their former husbands. American Academy of Matrimonial Lawyers, Press Release, May 8, 2012.

With the recent wave of divorces of high-power women such as Kim Kardashian, Sandra Bullock, Jennifer Lopez and Bethenny Frankel, just to name a few, even the media has taken note of what the New York Post dubbed the “women's divorce cur$e.” Theories abound as to why women breadwinners are more likely to get divorced than other women. Some conjecture that financially independent women have more freedom to leave bad marriages. Some commentators, most notoriously a fulminating all-male panel on Fox News' “Lou Dobbs Tonight,” have suggested that women breadwinners destroy marriages by upsetting “natural” gender roles.'

Several recent academic studies have shown that gender stereotypes do, in fact, play a part in this trend of increased divorce rates for breadwinner women. A May 2013 study conducted by faculty from the Booth School of Business concluded that it boils down to the fact that men just plain don't like the idea of their wives earning more than they do. Marianne Bertrand, et al., Gender Identity and Relative Income Within Households, National Bureau of Economic Research, NBER Working Paper No. 19023, May 2013. Even in this post- Lean-In world, husbands can't get past traditional notions of the man bringing home the bacon, and feel emasculated by their wives' big paychecks.'

Women, on the other hand, feel guilty for upsetting their husbands. To compensate, women take on an increasingly large share of the housework and childrearing duties as they begin to earn more than half of the household income. So, not only are these women fulfilling the responsibilities of the historically male provider role, but they are also taking on the lion's share (or, perhaps, the lioness' share) of the homemaker role, as well. This trend could explain why the Pew study found that both men and women report being dissatisfied with their marriages when wives out-earn their husbands.'

If Women Earn the Money, Why Don't They Hide It?

The fact that our social and economic realities have outpaced Americans' old-fashioned ideas about gender roles may explain why breadwinner women are more likely to get divorced, but it does not tell us why, in our experience, men are still more likely to hide assets when that eventuality comes to pass. Are men just more prone to lying about money?' It turns out the answer is “No.” A 2011 Forbes poll showed that 31% of men and women who do not maintain separate finances admit to financial infidelities. Jenna Goudreau, Is Your Partner Cheating on You Finanically? 31% Admit Money Deception, Forbes, January 13, 2011. However, the survey also revealed that women are more likely to hide minor purchases, while men are more likely to lie about major financial issues, such as the amount of money they earned or debt they owed. This gendered discrepancy in the types of lies men and women tell may find its source in yet another traditional division of labor that persists in most marriages: women control household spending, men control the family investments.

Women and men relate to money differently. A study by Prudential explains that, while women are overwhelmingly responsible for handling the household finances, they have little confidence when it comes to investing. Prudential, Financial Experience and Behaviors Among Women, 2012-2013 Prudential Research Study. Women tend to save rather than invest, and they often let their husbands make big financial decisions. While only 8% of women admit to asking their spouse to control financial decision-making, 38% of men say that they take control of financial decisions. Oddly, women breadwinners are less likely than other women to see themselves as primary financial decision-makers, even though they are more likely to keep separate finances from their husbands. No matter how smart or successful women are, they are still prone to leaving the big financial decisions up to their husbands.

We thus suspect that the differences we see in the kind of lies that men and women tell about money comes down to a question of access: Men control major assets like retirement and brokerage accounts, so they can hide the big stuff.'

We have seen this first-hand in countless cases. Smart, successful women come to us looking for money they helped to earn, but which their husbands have magically made disappear. When we ask about bank accounts and other finances, the women admit that they left all of their financial decisions to their husbands, and have never so much as glanced at a bank statement.'

We do, however, expect this to change as women's earnings continue to increase, but only if women become more confident making decisions about money. The Prudential study showed that women breadwinners are three times more likely than other women to hide financial accounts from their spouses. It also found that breadwinner wives are far more likely than other women to maintain separate finances, and hence, retain control over those finances. As with men who hide large assets simply because they control them, women who out-earn their husbands may eventually be more likely to hide money, simply because they can.'

Same-sex Marriages

None of the studies we found addressed the next big issue we see on the horizon: hidden assets in same-sex marriages. With the end of DOMA and the legalization of gay marriage in a growing number of states, we expect to see an uptick not just in marriages, but in divorces, as well. There is no reason to think that same-sex spouses will be any more truthful with one another than any other married couples. However, when traditional gender roles go out the window, many questions arise: Who manages the money? Who stays home with the kids? Who stashes the couple's savings in secret offshore accounts in anticipation of a divorce?

Although we have had some experience in this area, our anecdotal evidence is far from sufficient to provide generalizable answers to these questions. It is clear, however, that same-sex couples have to work together to come up with workable solutions for getting the bills paid, the housework done and the kids fed because they cannot fall back on gender stereotypes in the way that heterosexual couples do. A study by faculty at the University of Washington showed that gay and lesbian couples deal more fairly with one another than straight couples, with lesbians going to painstaking lengths to be egalitarian. Philip Blumenstein and Pepper Schwartz, American Couples, Money Work, and Sex, WM. Morrow Publishers, 1983.'

The study also found that in marriages of gay men, money talks. In straight marriages, men often control the family finances even if the wife makes the lion's share of the money. When two men are in the relationship, the one with the higher income is far more likely to have more financial decision-making power. This was less the case with lesbian couples than with straight couples or gay men.””

Nonetheless, early data suggests that one trend in heterosexual marriages ' women initiating divorce ' is magnified in same-sex couples. A study in Norway and Sweden, which have recognized a form of marriage for same-sex couples for nearly 20 years, found that lesbians are twice as likely as gay men to divorce. G. Andersson, et al., The Demographics of Same-Sex Marriages in Norway and Sweden, Demography, 43(1):79-98, February 2006.

Finding Hidden Marital Property

We expect a sea change in the type of marital asset searches we are asked to perform. As the number of women breadwinners who maintain separate finances from their spouses continues to increase, we anticipate a greater number of husbands approaching us to help find their wives' hidden money. As same-sex marriages become more commonplace, some of those couples will eventually get divorced and certain among them will inevitably conceal assets. We have already begun to see an increase in the number of same-sex divorce cases we handle. What we have found is that, regardless of who is hiding marital assets, we continue to successfully find those assets using the same time-tested approach we have always used.'

Whether or not your client is involved in making decisions about the family finances, he or she likely has information that can prove useful in unearthing hidden assets. We go through a meticulously detailed briefing process with all of our clients, even those who say they have never seen so much as a bank statement. This is because crucial information can come from the unlikeliest of sources.

For example, in a large percentage of our asset search cases, we find that a spouse has created secret companies. A savvy spouse will know not to name these companies after himself if he wants them to remain undiscovered, but most people are not all that creative when choosing a company name. Ask your client the names of the spouse's children or pets, the street he grew up on, or his hobbies. We once had a client whose husband named everything (including his secret companies) after classical composers. Also ask your client for the names of any companies she knows about. People are often lazy, and will repeat company names or repeat the name with a slight variation (i.e., Clearwater, Inc., Clearwater I, Inc., Clearwater Corp., etc.)”

Other crucial questions to ask your client include whether her spouse has ever been involved in litigation, and in what jurisdiction; the names of the spouse's business partners and those business partners' spouses' names; the spouse's e-mail or social media handles; where and how frequently the spouse travels; and the names of family members with whom the spouse does business or has frequent contact.'

A thorough initial briefing is important, but it is crucial that you conduct subsequent follow-up interviews with your client. As you begin to find information about the subject of your search, be sure to run it by your client. You may find names connected to the spouse's hidden companies that mean nothing to you. Your client, on the other hand, may recognize those names, and may be able to give you information about them that leads you straight to the spouse's hidden money. In short, you will have the best chances of finding the assets your client has asked you to find by asking lots of questions, keeping the lines of communication open, and, most importantly, by being a good listener.'

Anastasia Wincorn is a case manager with Charles Griffin Intelligence LLC in New York City. She received her J.D. from the Benjamin N. Cardozo School of law and, prior to joining Charles Griffin, she served as a law clerk in the Commercial Division of the New York State Supreme Court, and as an associate clerk in the U.S. District Court for the Eastern District of New York.'

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