Chapter 5: Lessons Learned
I. Looking at a Settlement Offer
You (or your husband) have formally filed for divorce. You both want to move on with your life. Naturally, you are anxious to get past the divorce process.
Or maybe, like me, you have started to uncover unsavory information about him. You want to dig more deeply into his behavior. If so, HE will certainly press to negotiate a quick settlement, hoping to do so before you figure out what has really been going on.
Whatever your circumstances, avoid a rush to settle until you and your attorneys are comfortable that all of the homework has been done to prepare (your) or evaluate (his) settlement offer. This includes understanding the divorce guidelines in your jurisdiction, having a complete picture of your family assets and their worth, understanding his business finances and having a complete accounting of at least the financial implications of any bad behavior.
Understanding the Divorce Guidelines in your Jurisdiction
Your attorneys will certainly know these points, but you should obtain a clear understanding from them of what you can expect if your case were to advance to trial, where a judge determines the asset distribution and your (or his) alimony. With this information, you can compare the financial implications of any settlement offer with what you might get at trial, though you do need to factor in your legal costs of going to trial (which can be substantial).
For example, Massachusetts, where I was divorced, is one of the 39 states requiring assets be divided in an “equitable” or fair manner, meaning the judge has the ability to decide a fair split of the assets, taking into consideration factors that include each spouse’s age, health, income, employability and others. Fortunately for me, bad behavior can also be considered by a judge in making a determination of a fair distribution, especially when the conduct has led to a significant dissipation (the legal term for misspending family money) of family assets. 1
Alimony guidelines are much less clear cut but your lawyers will know how courts (and even particular judges) tend to rule in your jurisdiction. Massachusetts is a state specifing by law the defined range for alimony awards at 30-35% (many states do not do this). This range is nearly always followed by judges at trial, if sufficient need can be established. Judges in Massachusetts have the discretion to look at 14 factors in determining alimony percentage and asset distribution, each spouse’s conduct during the marriage being one of them.
Getting this information from my lawyers helped to create a context for the initial settlement offer my husband made. The “very generous” alimony offer turned out to be less than 20% of the difference between our two incomes, far less than the 30% minimum in the Massachusetts guidelines. In addition, it was likely a judge would award me more than 50 percent of our total assets, the addition being literal payback for Scott’s spending on his affairs. The amount would most likely be equivalent to half of the money Scott had spent. Knowing this, it was relatively straightforward for me to calculate a likely award I would get from the judge and compare it to what Scott had offered. It was then I realized, far from being generous or fair, it just wasn’t a good offer, even after legal costs.
Having a Complete Picture of Your Family Assets and Their Worth
You must know what your family assets are, how much they are worth and how they get paid out. Now is not the time to be financially disinterested or clueless. You should seek the help of your financial advisor and your lawyer in this effort. You must NOT take your spouse’s word on the finances, even if he has been the one managing them throughout your marriage.
Ideally most of your significant assets (real estate, investment accounts and others) will be jointly held which will protect you from any financial abuses during your separation and divorce process. Retirement accounts may be individually held (though they will need to be split up in the divorce settlement) and with the penalties for early withdrawal, you have greater protection from financial abuses.
It is also important to note, hiding assets is illegal. Given the large amounts of cash my husband had withdrawn, I was quite concerned he had purchased real estate for his mistress or even invested in a business for her. I found comfort in knowing he would be breaking the law by refusing to reveal such an asset.
Understanding His Business Finances
How your husband gets paid, what retirement and other assets he may have in the context of his employment and his health insurance may be relatively straightforward. In my case it wasn’t. It took some time and a number of meetings with my husband’s employer for my lawyer to determine the details of how Scott got paid, such as his partnership draw, profit distribution, and others. Scott’s monthly compensation was complicated enough you had to look at a spreadsheet forecast to see how much he was due to receive each month. His employment-related assets were similarly complex.
Since I was not permitted to participate on the calls between my lawyer and Scott’s employer, Patrick had to debrief me on the details after the calls. This process took place over a number of months, thus precluding a quick settlement.
Investigating Bad Behavior
If you believe your husband has dissipated family assets, you may just need more time to get to the bottom of his behavior, financially. Knowing how much he has spent is important to any asset division discussion. Establishing exactly how he spent it strengthens your argument. The evidence you uncover about his bad behavior will be instrumental if you have to prove the dissipation at trial.
Don’t Get Bullied by Your Husband or His Lawyer
Scott tried all the tricks in the book to convince me to stop investigating and settle the case quickly. When I pointed out the holes in his financial argument and refused to acknowledge his “legal expertise” and opinion of my lawyers, he went the emotional route, asserting he was a better man since he had moved on. I had a problem if I didn’t do the same.
It is important to listen to your lawyers and hold your ground if they advise your situation warrants it. In my case it did, both because we didn’t have enough of the financial details from his employer and because his settlement offer was so short of reasonable given the circumstances.
It is understandably tough to be emotionally manipulated by someone you once loved, or even still do. One way to mitigate this bullying is to drastically limit contact. I had discontinued any face to face contact when Scott moved out. Even better, a few months later, I also cut off voice contact with him. The bullying is much more apparent (often ridiculously so) when it is written, either in texts or emails. And when the verbal assaults are in black and white, they can be shared with your lawyers, which was very helpful for me.
II. Investigating Credit Card Charges
Investigating your bank records will uncover any suspicious outflows of money, which in my case included almost $250,000 in excessive cash withdrawals and the unexplainably high credit card payments on his two private cards. The information wasn’t enough, however, to paint a complete picture of Scott’s misbehavior or how much money he had spent on the affairs. I needed to see, in detail, how he had used his credit cards to really understand his behavior.
A detailed investigation of your spouse’s credit card spending provides additional information in the following ways
- The pattern of credit card charges will help you to identify what he really has been doing — is he spending the money on other women? Or is it something else such as gambling or drugs?
- If you believe the cash withdrawals were spent on other women, it is likely your spouse used his credit cards as well. By reviewing the statements, you can identify how much additional spending occurred, thus adding to the “dissipation number” you will ultimately seek. You will need to do this charge by charge, as he probably has used his credit cards for acceptable personal or business uses as well.
- In order to prove your spouse has spent his family’s money on other women, you will need additional proof beyond suspicious cash withdrawals and payments to credit cards you find in the bank statements. Investigating the details surrounding his credit card charges, including what was purchased, where it was purchased, and how much was charged may shed an enormous light on the story of his behavior. A charge by charge investigation could uncover particular line items and even patterns of charging behavior adding to your argument he has spent family money on other women.
Getting Access to the Credit Card Statements
If you have online access to the credit card, you can request PDF copies of past billing statements. Otherwise, you will need to subpoena the statements. This is not terribly expensive as it is a boilerplate exercise for your divorce attorney. In my case, for example, the average cost of issuing a subpoena was less than $300. Your bank statement research, if it has indicated when the withdrawals and excessive credit card spending started, will tell you how far back you need to go.
You should investigate all of the cards he could have used including his private cards, any jointly held or companion cards, and his business credit cards. I subpoenaed the billing statements for both of Scott’s personal credit cards, my American Express (for which he had and used a companion card), and his company credit cards.
Investigating the Statements for Suspicious Charges
Review the statements, line item by line item, and highlight those seeming suspicious. I found it was easiest to print them out and use a highlighter pen to identify the suspicious charges. You should make note of the charges you can’t identify so you can Google them to determine what they were.
The example below, from one of his personal credit cards, shows my highlights and notes regarding:
- Hotel charges when I couldn’t have been with him, including both out of town hotels and even hotels in our hometown, Boston. Some were for hotels to which I had never been, others I had visited at some point but not the time indicated on the charge. In the example below, these included
- Stonehedge Inn
- Eliot Hotel
- Back Bay hotel
- Strange charges I needed to Google, such as SD4MEII.
- Restaurant bills (some quite large), in towns in Massachusetts, New Jersey (including many near where Miss New Jersey lived), New York, Connecticut and other states.
In another example, this one from his business American Express Card, I identified
- Plane tickets from New York to Chicago, one purchased for him and one for Miss New Jersey. When I compared this to my work calendar, I learned the date of the travel (7/18-20, 2010) was less than a month after he first told me about her. In addition, the travel happened when I was on an exhausting 10-day work trip to Japan and Australia and he left our daughter home with the au pair.
- Two hotels were booked in Chicago for the trip – perhaps one was booked for business reasons and the other where he stayed with her? Why would both of these be on his business Amex? Regardless, since it was suspicious, I highlighted it.
Using Google to Decipher the Charges You Can’t Immediately Identify
You are likely to find charges you can’t identify. I was able to clarify nearly all of these “mystery” charges using Google search, though I often needed to try a number of different ways of Googling the information I found on the charge. Creative Googling became a skill I leveraged throughout the discovery process.
The first step is to enter the information you have identified from the line item in the billing statement. Using the first example above, SD4MEII
I could then go to the website indicated above: www.sugardaddyforme.com and see what he had paid for. This showed Scott was hoping to be a “sugar daddy” to a much younger woman, offering her money in exchange for companionship and sex.
You can also input the information as a question, as I did below to learn ADL media was the holding company for Ashley Madison, a dating website for married people looking to have affairs. He had paid for a subscription to the dating site as well.
Sometimes Googling the name of the institution didn’t give a clear enough result (as there might be multiple businesses with the same name). If the location was listed as well on the charge, I tried Googling the name and the location together as below to see he had charged a meal at a restaurant near where his mistress (or at least one of his mistresses) lived.
If there isn’t a location indicated there may be other information you can include in your Google search. For example, Scott had a line item charge to AMTC. When I googled AMTC, I got a talent agency. The phone number was also listed in the charge, so I entered that in another Google search attempt. I got a Same-Day STD testing service, thus suggesting he had paid to be tested for sexually transmitted diseases.
Summarizing the Dissipation: How Much Money Was Spent?
You have already built spreadsheet pages showing the suspicious ATM, teller assisted and credit line cash withdrawals with totals computed by year. Now you can add to it the credit card charges you have identified and researched. Do this by creating a new spreadsheet page for each credit card, listing each suspicious charge by date and place and amount. Also total the charges by month and year.
The example below shows an excerpt corresponding to one of Scott’s private credit cards
You can summarize your banking and credit card investigation by adding a page totaling the dissipation by year and showing its component parts as shown in the example below:
This spreadsheet file became an extremely important document. It communicated clearly to my lawyers my findings of how much Scott had spent. As I learned more, I could add pages to the file to reflect the new sources of spending I discovered. For example, I initially assumed Scott wouldn’t dream of using his business credit cards to pay for his affairs. Once I found out he was indeed that bold, I could document those charges by adding another page to the spreadsheet.
Scott remained resolute in his refusal to “own up” to what he had done, even refusing to do his own analysis of what he had spent. In cowardly fashion, his admissions of guilt only came after I unraveled the hard evidence of his infidelity.
The spreadsheet file became the record of his spending that we (Scott, me and the lawyers) ultimately used for negotiations of how much I would get back. Failing a negotiated agreement, the file would subsequently be used in court, accompanied by the banking and credit card statements as the hard evidence.
In some ways, Scott made it easy for me to turn down his initial settlement offer. It just wasn’t a good one. Moreover, I asked attorneys if I should take it — they responded they simply couldn’t offer an opinion because they didn’t have the information about his employment. This gave me more time to issue subpoenas and analyze the credit card information.
The credit card analysis, in addition to uncovering another $180,000 in suspicious spending, revealed a great deal about what Scott had been doing. There most certainly was more than one woman, and maybe a large number of them. He had spent a substantial amount of money entertaining them – hotels, restaurants, liquor, gifts and who knows what else. He had taken at least one STD test, suggesting even he thought he was swimming in a questionable pool.
Some of the women (at least the “Sugar Babies”) were looking for cash in exchange for sex. The Sugar Daddy websites indicated he was looking to hook up with young women which horrified me given the ages of our girls (eighteen and fourteen) and their friends. I asked a male friend how a middle aged man could do that. Wouldn’t he realize how slimy he looked? My friend laughed and joked any older guy would date a younger woman if he could get away with it. Apparently that was an apt description of Scott.
Finally, he had used a secret cell phone. If I could only get those phone records to show who he was calling. Patrick and Marianne were not optimistic we could actually obtain the information but I asked them to issue a subpoena to Virgin Mobile anyway. Following my instincts, I also asked them to issue subpoenas to Hotels.com (to establish which hotels he had arranged through Hotels.com) and several of the retailers where Scott had made significant charges, such as Jewelry by Alex. I figured it couldn’t hurt and maybe we would get additional evidence. Boy was I right!
