January 31, 2013 Articles

A Successful Asset Search Starts with a Great Interview

By Philip Segal

Human beings sometimes know a lot more than they think they know. Even for those of us who are lousy stock pickers and can’t put together a business plan, we know a lot about the people we live with.

It is consistently remarkable to me that when talking to a client about a spouse suspected of hiding assets, it takes two or three conversations or emails to elicit all the helpful information our client knows about her husband and where his assets could be.

Case in point: a recent investigation started after the wife gave us “all” the names of companies her husband had been associated with. A week later, she remembered two more names. A week after that, she remembered that she had not given us a cell phone number her husband uses when he is in the United States. That cell phone ended up tying him to a company for which we had no other documentary evidence of his involvement.

The moral is that a good asset search starts with a great interview, and needs follow-up (and often a few follow-ups).

We have devised a questionnaire we give to clients who want us to search a spouse’s assets. This differs from the form that most states require an opposing spouse to fill out because it asks not only for asset information but for clues to help find assets.

To repeat, we always seek to look not just for assets, but for things that will lead us to assets. So, litigation, side companies, and security agreements are critical in addition to real estate records. You don’t know the name of your subject’s company that holds valuable assets, but that person may have been sued personally along with the company. Look for personal lawsuits and you could find a company, and that company could control assets. You often need to peel the onion starting with the skin around the assets.

To repeat, we always seek to look not just for assets, but for things that will lead us to assets. So, litigation, side companies, and security agreements are critical in addition to real estate records. You don’t know the name of your subject’s company that holds valuable assets, but that person may have been sued personally along with the company. Look for personal lawsuits and you could find a company, and that company could control assets. You often need to peel the onion starting with the skin around the assets.

We ask for nicknames, names of pets, hobbies – all of these can uncover hidden companies or partnerships. We once had a case in which the husband was an opera buff, and had named a dozen companies after operas. Looking for Tannhauser is a lot faster than a search for a company that may start with the word “American” or “Allied.” 

What else would help us to track down assets? Certainly we want a full list of all known companies, because many people are lazy and repeat names over and over in differing jurisdictions. Allied Industries of Oregon is a company we know about, but what if we find an Allied Industries of New Mexico and we know that our man is from New Mexico or goes there on business? We would look closely at that company.

Among other keys to a great interview prior to an asset search are to ask the following:

 

• What other names does the person go by? Does the person use her given Korean name instead of the “Lisa” she added when she moved to the U.S. at age 5? Does Leonard Martin go by “Bud Martin” half the time?

• Does the person use a middle name instead of a first name, or perhaps just an initial? A clerk who files something by middle name instead of first name is not going to notice that mistake or help you figure things out when the document you’re pretty sure you should find just isn’t in the registry. Don’t rely on the clerks in your state capital who enter data to get it right for you.

• Can you give us a photograph of the person and a sample of a signature? There is no point in wasting time looking at a person’s Facebook profile if you have the wrong David C. Worthy? Why get copies of the deed to a Las Vegas mansion when the signatures don’t match even closely?

• Who are the closest friends and relatives of the person we are searching? Sometimes compliant associates are used as straw men to hold assets until a divorce is concluded. We like it when we find that the blue-collar father of a well-off son suddenly “pays cash” for an asset he couldn’t afford the week before. We especially like proving fraudulent conveyance, which comes in many guises.


• Who are the lawyers our subject has used in his business transactions? Sometimes you can look up companies by the name or address of their incorporator. We have been able to find assets by looking over a list of companies put together by a particular lawyer. We then use a company’s name or address for process of service to tie the company to the person whose assets we are searching.

• Where does the person like to travel? How frequently? Might there be property or an expensive car or boat there? Could the new company be named after the name of the family summer home or a favorite vacation spot?

• In addition, there are the obvious things any investigation needs: date of birth, all known addresses past and present, phone and fax numbers, all internet “handles” (since if he is  luxury33@abc.com he is likely to be luxury33 at a whole bunch of other sites, including Facebook). We also want all litigation, professional licenses, and much more. Our asset checklist is available on our blog, here.

Why not Just Google It?
Sometimes our clients want to know why an asset search could take a couple of weeks and often longer. Why, they ask, can’t you just spend a few hours on Google and get whatever you need? Part of our briefing includes our often-repeated (and can’t be repeated enough) points about why Google is not enough.

• Google is never enough because most things in the world are not on Google. If you Google yourself, you will probably come up with one percent of all the useable information an asset searcher would need about you. Everywhere you’ve worked? All your associates? All of your real estate holdings in every jurisdiction? Highly unlikely. Try Googling yourself. If your information is so spotty, why should anyone else’s come up in greater detail? Remember, Google hasn’t scanned every public record in the United States. It hasn’t even scanned most of them. That’s why we go into courthouses all the time and retrieve physical records.

• Google is a business, not a neutral index there to help one and all. Google favors those who advertise on it. You advertise and pay top dollar, and you will get your search results up high. If you don’t pay as much the results could still be high if Google’s secret algorithm happens to like the information, but four searches done on the same terms three hours apart can yield very different results. The same is true of word order. Googling “Corona Ventures Elroy Johnstone” is not the same as googling Elroy Johnstone Corona Ventures.

• The third reason a plain old Google search isn’t enough is that in the same way we search for facts that will lead to assets, a Google search should often be for a thing that will lead to the thing we really want. While a valuable search tool, Google is often most valuable as a starting point.

Say you are looking for a construction company in Arizona, because your client suspects that this is where her husband (in the construction business at home in Georgia) owns valuable assets. If you Google the subject’s name and “company” or “construction,” you may not get very far. But what about if you use Google to look for a registrar of companies in Arizona? You then search that registrar’s site to look further. Better yet, what about a site that licenses projects in Arizona? Google can help you assemble a list of helpful places to continue your search.

Now suppose the licensing board isn’t online. You may need to say good-bye to Google temporarily and use a revolutionary device known as the telephone.  I had a case once where I was checking out a person doing business in Asia, and part of his story was that he had been two-timing his employer by doing business back home in the United States. How did I prove this? Partly by finding a business license issued when he should have been working in Asia for my client’s $200,000 a year. But in this state, his kind of license was issued at the municipal level. An old fashioned phone call to the local City Hall got the job done.

Keywords: litigation, family law, assets search, physical records, questionnaire, interview Google


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