Wednesday, 19 September 2007

NEST EGG PROTECTION


The long queues at Northern Rock branches this week are worthy of comment. What is it that makes people panic about money even when they are given assurances by the Government that their funds are safe? Discounting the potential for a lack of belief in politicians’ promises, or the English phenomenon of joining queues because we appear to like standing in line, I think it’s something much more deep rooted. Money equates to security and we all need to know that our little nest eggs are safe

Inevitably in divorce cases panic arises in relation to money. Some clients deal with this by rushing to the bank and withdrawing everything; others seek to transfer it into the account of a close friend or relative, sometimes fabricating a debt or other apparently legitimate reason for the transaction. The trouble is that there is always a paper trail showing the movement of funds and this inevitably leads to some embarrassing or convoluted explanations.

Once upon a time I acted for a client. On the day his wife left him citing grounds for divorce that included his meanness towards her, he withdrew a substantial sum of money representing a quarter of his life savings from the bank, and donated it to a local charity in which his mother was an active fundraiser. Subsequently, in court, the Judge congratulated him on his altruistic nature but held that, as he could clearly afford to be generous and had no need for funds of this amount, he should give his wife an equivalent quarter and the remaining half should be divided equally between them!



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