Assets are easy to hide. From an individual hiding wealth from their spouse during a divorce to someone transferring money into an offshore company bank account to avoid detection by creditors or to hide proceeds of a crime, as concealing assets makes it difficult for the asset owner to claim what’s rightfully theirs.
But that doesn’t mean hidden assets can’t be found. When a wrongdoing has been committed, concealing assets is against the law. If you suspect someone you know of unlawfully hiding assets to which you have a claim, you can take action.
One common technique for discovering hidden assets is asset tracing, which allows intelligence providers like SIP International to uncover the location, source and ownership of any assets hidden from an individual who has a rightful claim to them.
This blog post explains everything you need to know about asset tracing, including what it is, how it works, and how an asset trace investigation and recovery can help.
What is asset tracing?
Asset tracing is the investigative process of following a trail of money and links to entities associated with the person concealing them. Asset trace investigation specialists do this to locate hidden assets, which can be anything of value someone owns, like property, investments, or even physical cash.
The goal of asset tracing is to find hidden assets by following the trail of money stolen or misappropriated illegally from the rightful owner and the identity of the wrongdoer and accomplices to the crime. This could be in a situation like a lawsuit, where one party needs to identify all the other party’s assets, or in fraud cases, where someone has stolen or misappropriated money or property illegally, and the rightful owner wants to get it back.
Asset tracing can be complex, especially when assets are hidden in offshore company structures or moved around through several accounts in an effort to conceal them. Asset trace investigation specialists are crucial for anyone looking to uncover hidden assets, and recovery is rightfully theirs.
What is asset recovery?
Asset recovery is the process of retrieving assets located through asset tracing. After the investigative phase of asset tracing has uncovered hidden assets, asset recovery is about taking steps to return those assets to their rightful owner.
In some cases, recovering assets can be achieved through negotiation with the party who is holding them. This might involve offering a settlement or proposing a way for them to return the assets without facing legal consequences.
If negotiation fails, asset recovery often means filing a lawsuit to obtain a court order forcing the return of the assets. This can be a complex legal process that requires a lawyer with experience in asset recovery cases along with broader legal authorities to seize assets or pursue criminal charges.
The lawyer will also need detailed evidence from an investigation agency that carried out the asset trace intelligence that demonstrates factual links between the accused and the accounts or entities where the hidden assets have been concealed illegally from their rightful owner.
The legal process for asset recovery can be challenging, especially in cases involving multiple jurisdictions or complex financial structures, but companies like SIP International have extensive experience in this field to maximise the success of the recovery of assets.
Common techniques for asset trace and recovery
Asset tracing and recovery rely on a combination of traditional investigative methods and modern technology to be successful. Some common techniques include:
1. Open-source Intelligence (OSINT)
In asset trace and recovery, open-source intelligence involves scouring publicly available information like social media profiles, news articles, and public registries (property and company filings) to find clues about the target’s assets. Social media profiles can reveal a lot about someone’s lifestyle, business ventures, and even associates. Following their posts, pictures, and connections can provide leads on potential assets or spending habits.
Following this initial stage, the specialist asset tracing teams access public registries like property records, corporate filings, court documents, and bankruptcy filings. These records can reveal ownership of real estate, businesses, and other assets registered under the target’s name or the names of accomplices associated with them.
News articles, blogs, and other internet content also help asset tracing teams to uncover hidden assets, especially in high-profile cases. Mentions of the target in business deals, property purchases, or legal proceedings can all be used to find any assets they might be hiding.
While this may sound simple, the team must have access to 100s paid subscribers and public databases worldwide, as most concealments involve entities outside the jurisdiction where the person concealing the assets resides.
Specialist asset trace teams have dedicated compliant servers to extract data from the worldwide surface and deep webs. They also have specialists who can infiltrate dark web chat rooms when necessary. Many investigation companies have limited capabilities in asset tracing, so you should instruct a company like SIP International with this expertise.
2. Financial Analysis and Forensics
Forensic accountants meticulously examine bank statements, tax returns, invoices, and other financial documents, looking for inconsistencies, unusual transactions, and sudden changes in spending patterns.
Financial ratios like the current ratio, debt-to-equity ratio, and inventory turnover ratio can reveal red flags if they deviate significantly from industry benchmarks. This might indicate asset manipulation, misappropriation or other fraudulent hidden financial activity.
Analysing trends in financial data over time can also expose anomalies. For example, a sudden increase in cash deposits with no clear source might warrant further investigation. By analysing financial data, forensic investigators gain a comprehensive understanding of the target’s financial situation, revealing potential hiding places for assets.
3. Specialised Asset tracing tools and Databases
Asset tracing tools are software programs designed to streamline and enhance the asset tracing process. They can gather information from various sources, including public records, financial databases, and internal investigation data, and consolidate it into a central platform.
At SIP, for instance, our unique dedicated server enables us to conduct database searches on over 420 international paid subscribers and public databases with a single input of the subject’s identifiers. Our researchers then evaluate the compliant data, regardless of language, to extract the most relevant information that may lead to the location of tangible assets such as property, vessels, aircraft, shares in businesses, or links to offshore entities where the subject may be the ultimate beneficial owner. Learn more.
4. International asset tracing
International asset tracing is the specialised branch of asset tracing that deals with locating hidden assets stashed across borders. Investigators often work with global partners, including lawyers and financial institutions familiar with the target country’s legal system and financial landscape. Specialised databases containing information on companies, directors, and beneficial ownership can be crucial for identifying assets held abroad.By collaborating with international partners, utilising specialised tools, and following the money trail, investigators can increase their chances of successfully locating and recovering hidden assets across borders.
5. Surveillance
In asset tracing, surveillance refers to the discreet monitoring of a person or place to gather information that can help locate hidden assets. Investigators might tail a target to observe their movements and identify potential locations of hidden assets. This could involve following them to safety deposit boxes, meetings with associates, or properties they might own but haven’t publicly disclosed.
In some cases, with proper legal authorisation, investigators may also use electronic surveillance techniques like GPS tracking or geo-location techniques to monitor a target’s movements. This can provide valuable insights into their activities and potential asset locations.
Read more: Geofencing vs Geolocation: What’s the Difference?
Surveillance is subject to strict legal regulations, and investigators must ensure they have the proper authorisation and adhere to all relevant laws to avoid legal repercussions.
Why might someone need an asset trace?
There are several reasons why someone might want to conduct an asset trace. Some of the most common reasons for asset tracing include:
- Debt Collection. If someone is owed a significant amount of money and the debtor refuses to pay, an asset trace can help locate hidden assets that can be used to satisfy the debt. This could be in unpaid judgments, defaulted loans, or business disputes.
- Fraud or Embezzlement. If someone suspects they have been defrauded or a victim of embezzlement, an asset trace can help track down the stolen funds. This can be crucial for recovering what was rightfully theirs and potentially holding the perpetrator accountable.
- Divorce or Separation. During a divorce or separation, spouses may need to disclose all their assets to ensure a fair division of property. An asset trace can help uncover hidden assets one spouse might be trying to conceal, ensuring an equitable settlement.
- Inheritance Disputes. In situations where there are disagreements about the distribution of an inheritance, an asset trace can help locate any missing assets or ensure all beneficiaries receive their rightful share
- Law Enforcement. Law enforcement agencies often use asset tracing to track down the proceeds of crime or to uncover hidden wealth linked to corruption or money laundering. This helps to disrupt criminal activity and recover stolen funds.
- Pre-judgment Asset Tracing. In some jurisdictions, courts may allow pre-judgment asset tracing. This means that before a lawsuit is even filed, a party can request an asset trace to identify the other party’s assets with the goal of securing them in case they win the lawsuit and need to collect a judgment.
It’s important to remember that asset tracing can be complex and expensive. Before embarking on an asset trace, consulting with a lawyer or professional investigator is wise to discuss the feasibility and potential costs involved.
Why Choose SIP International’s Specialists for Asset Tracing and Recovery
SIP has specialised in tracing tangible and liquid assets since 1983 and has successfully traced hundreds of millions of dollars in assets globally. Our asset tracing specialists conduct comprehensive open-source research using a bespoke compliant cyber intelligence server that scours the global surface, deep, and dark web.
We excel at proving asset ownership, as we have extensive knowledge of cross-jurisdiction legislations and procedures to avoid the many pitfalls law firms may encounter.
We draft specific content for Court Orders and enforce them in other jurisdictions to secure disclosures from business entities, banks, other financial institutions, and more. Our goal is to ensure the best evidence possible to support asset recovery to fulfil a client’s judgment.
Get in touch to speak to our experienced asset-tracing specialists.
