Infidelity is one word that is frequently mentioned when it comes to divorce proceedings.

In most cases, it refers to a breach of trust related to extra-marital affairs and other similar activities committed by one of the spouses.

However, things are changing and becoming much more sophisticated, according to one forensic accountant.

“With the rapid increase in online banking, credit card manipulation, and transactions there has been an increase in what we’re calling ‘financial infidelity,” said Harriett Fox, a leading forensic accountant with additional specialties in civil and commercial litigation. “Basically, this refers to strategies implemented by a spouse to gain a financial advantage during a divorce.

“In recent years, it has become much easier to hide these activities since most can be initiated and conducted on the Internet.”

Fox points out the following activities that have become quite rampant and ones she has investigated as divorces proceed:

- Holding secret bank accounts
- Incurring debt that one spouse may not be aware of
- Stashing away cash without the other spouse’s knowledge
- Owning properties and other assets
- Hiding assets that may retain marital status

“These are just some of the activities we’re seeing in family courts which can put an unknowing spouse at a significant disadvantage,” said Fox. “At the heart of these practices is an absence of financial transparency. It’s important for us to track all financial records and activities so that a fair and equitable settlement can be reached.”

Fox points out that at the outset of a marriage, husbands and wives should agree to participate in all financial decisions.

“It’s certainly common that one of the spouses handles most of the financial matters,” she said. “This can include paying bills, saving for retirement and college education, and purchasing insurance. Regardless, it’s important for each to have a clear picture of income, expenses, spending and investing.”

Fox points out that irregularities should be red-flagged by the spouse, especially if there are unusual marital problems.

“If these financial infidelities come to light, it could be evidence that one of the spouses implemented them as a way to plan for divorce and subsequently walk away with quite a bit of money,” added Fox. “If so, the court could possibly compensate the unsuspecting spouse in the final settlement.”

Fox also has seen situations where the unknowing spouse was held responsible for debts incurred by the other spouse following the divorce.

“These are just some of the problems that can result when spouses don’t share financial information,” she said. “That’s why it’s important to create an environment that makes financial infidelity less likely in the event that a divorce happens.”

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