Conducting a bank account search can provide you with very valuable information about a debtor’s wealth for pre-litigation and divorce cases. There are other reasons to request a bank account search, but in regard to using the bank account search to identify assets, this is typically seen most in pre-litigation and divorce cases.
If you have a judgment against someone and plan to collect funds from the defendant, it’s important to conduct a bank account asset search prior to litigation. Funds and assets that are not discovered pre-litigation are likely not eligible to be rewarded to you if you win your case. Hidden assets cannot be proven if you don’t have the pre-litigation proof that those funds or assets ever existed.
When you run a bank account search, you’ll receive a list of banks that are holding deposits for your debtor, the amounts on the deposit, full or partial account numbers, and sometimes recent transaction information. Here are 5 key things you should look for when conducting a bank account search:
Do the math
If a third party provides you with a bank statement, make sure to do your own calculations to ensure all of the funds in the account are properly recorded. Missing funds or numbers that don’t add up could be a red flag of a fake statement or hidden funds.
Check the transaction dates
If you see a deposit from a bank branch, verify that the bank was open on that day. If a transaction is recorded on a day when that bank closed, this could be a red flag of a fake statement or fraudulent entries.
Look for QuickBooks deposits
Typically these are payroll transactions and examining these transactions could reveal your debtor’s source or sources of income.
Look at withdrawals and purchases
What merchants are on the statement? You can verify with that merchant what was purchased and sometimes this can lead you to uncover other hidden assets. If the purchase is for luxury vehicle wheels, you can safely assume that there’s a high-end vehicle hidden somewhere.
Look for a merchant services deposit
This means that the account holder has some business that is posting credit card payments to the account. This could lead you to identify the businesses your debtor operates. Also, look for check deposits, oftentimes this can indicate a business being operated.
A bank account search is extremely valuable in pre-litigation and divorce cases. It helps you determine the true wealth of your debtor and to determine if your debtor is hiding funds or other assets. By comparing different time frames from the bank account statements, you can get a better understanding of what assets have been concealed or transferred away from the debtor that may impact your ability to collect and recover losses from a lawsuit.
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