An insidious form of conflict of interest
Interesting Info You Can Read Over a Single Cup of Coffee!
Julie Kern, CPA, CFP®, CDFA®
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In this issue:
- An insidious form of conflict-of-interest
- Settlement Assurance Review
- AFI service
An insidious form of conflict-of-interest
Quick question: An affluent woman calls your office. She’s interested in retaining you as her attorney in her upcoming divorce. What’s the very first thing your front office person asks her?
You didn’t even have to think about that one for a single heartbeat. Your front office person asks them, automatically:
“What’s the name of your spouse?”
A non-attorney reading this article would say “Huh?” But you’re all over this. You need to find out, ASAP, if there’s a conflict of interest lurking in your path. You don’t even want to make eye-contact with that woman if your office is already representing her spouse!
(Side note: I’ve heard that in some small towns, it’s an established spiteful tactic for a divorcing woman to quickly take intro meetings with every single attorney in town… just to purposely pollute the waters for her spouse when he tries to find a lawyer. Ah, all is fair in love and war.)
I knew you’d sit up and take notice the moment I mentioned “conflict of interest.” And as a CPA, a CERTIFIED FINANCIAL PLANNER® professional, and a Certified Divorce Financial Analyst® professional, I want to warn you of one that might not be as obvious as the spouse-is-already-our-client variety.
A dangerous assumption
Many attorneys will automatically rely on the accountant who had been serving both the husband and wife during the course of their marriage, when it’s time for divorce. And why not? The accountant is neutral, and is obligated to share unbiased information evenly with both parties and their lawyers.
If only it were that simple.
I’m working on a case right now where the accountant (a CPA, I might add) initially told us that they’d provide anything we needed… but now is reneging on that promise. I need information to calculate my client’s tax situation, but the CPA is clearly taking the husband’s side.
Why? Well, the marital estate in this case is valued in the tens of millions, and this CPA is getting blinded by greed. (And there are enough CPAs out there who simply don’t understand divorce-specific tax treatments and extensions, without the willful withholding of information.)
Don’t fear for my client. I’m working with her great attorney to subpoena the information. And I’ve taken the rare step—the first time in my career—of filing a complaint with the Arizona State Board of Accountancy. This is a serious breach.
Here’s the takeaway for you: This kind of conflict of interest—of the supposedly neutral accountant—is more common than you might think. And while its nuances will be hard for you to detect, they light up my radar like an incoming missile.
Let me help you, and your client, to get an equitable settlement, quickly, with minimal drama and zero conflict-of-interest. Contact me and let’s talk.
Settlement Assurance Review
For every time you’ve been faced with a complex case—such as one with a lump-sum spousal-maintenance payout, or a complicated asset mix with hidden tax implications—and told your client, “You should talk to your tax or financial advisor,” I have a new service for them… and you.
It’s simple. When you and your client are considering a settlement, I can review it from a financial-expert perspective, for a nominal fee, and “bless it” (or not) before you go to court or mediation. The Settlement Assurance Review scrutinizes your client’s divorce settlement terms before finalization, providing:
- Equitability analysis: A detailed evaluation to ensure the proposed settlement terms are fair and well-balanced.
- Tax impact assessment: Identification and explanation of any potential negative tax implications.
- Risk mitigation review: Detection of any hidden financial risks or liabilities that could impact your client’s financial well-being, post-divorce.
During these reviews, I often discover hidden negative tax implications and other undesirable outcomes and risks that would be detrimental to your client. This can significantly reduce your liability exposure, while giving your client added confidence, and making you look even better in the process!
By partnering with us, you can confidently assure your clients that their financial interests are fully protected and their settlements optimized for both fairness and financial clarity.
Contact me and I can help you easily get your clients started with this.
AFI service
Seeing how often improperly-completed AFIs can frustrate attorneys like you, I’ve created an all-new service: I’ll help your divorcing-women clients complete their AFI, within one week of getting the supporting documents (bank and credit-card statements, etc.). And I’ll do it for them for a flat fee of just $495.
So they—and you—will have a good, solid AFI that opposing counsel can’t poke holes in, for a flat fee, in fast time.
Contact me today to get started!
