Getting Taken to the Cleaners, the Poorhouse, or Worse–to Jail

As much as your friends and family would love to protect you, it’s really your own job to avoid being betrayed financially, as you’re the one who has all the clues. Be your own detective regarding financially improper or criminal behavior.

But how do you read those clues, and what should you be looking for? My guess is that my readers have a number of ideas, and I’d love to hear them. I offer suggestions I’ve gleaned from my clients who have learned the hard way.

1. When you compliment your wife on her new dress, she tells you it isn’t new, it’s been in the closet for years, you just don’t notice stuff.  If this apparent confusion happens frequently, check it out.  Examine the credit card bills, especially for cash advances, which not only obscure the places where someone spends the money but increases the credit card fees.

2. Let’s say your husband bought you that $3500 purse you’ve been just longing for–with cash. Your antennae go up. If you find your spouse funding very expensive purchases with cash, he may  be laundering money.

3. Make sure that important documents—life insurance papers, certificates of deposit, brokerage statements—are available for you to see. If your spouse is resistant, that’s a clue, detective.

4. Don’t be the person who says, “I don’t get it. I don’t know anything about finances.” Don’t take pride in willful ignorance. It could cost you in many many ways. If you don’t understand something in the financial realm, use the library or  internet, ask friends, or buy an hour of an accountant’s time to ask for an explanation.

5.  If you’re dating and someone throws fairy dust in your eyes with all kinds of fancy stuff, beware, especially if you’re in a vulnerable financial situation yourself.  Yes, if he lends you his credit card, fills up the car with roses on his way to pick you up, and seems to have bought stock in Godiva–that is heavy-duty financial persuasion to win you over. Ask yourself why.

6.  If a person you are dating has no credit cards, be suspicious. Why would that be? It might have something to do with their being unable to handle money–either no credit or fear of losing control with credit cards.

7.  Notice well what kind of friends/associates your new love has. Ask yourself: Are these people I would admire and trust, or do they make me nervous.  Be honest with yourself–if the new man in your life presents as a financial hotshot, but all his friends are not, the situation simply doesn’t compute.

8. All major purchases—cars, large pieces of furniture, timeshares, large payments to adult children, loans to friends—should be discussed before any money changes hands. If you find yourself being left out of these transactions, you need to figure out why–and what to do about it.

And as you’re honing your detective skills, become aware of a few other signs that something’s just not right. If where your wife says she’s going and the computed mileage on the car are vastly different, think about what that might mean. And remember Jane of the gambling boats, whose story of her whereabouts simply couldn’t have been true, as her husband suspected? Well, that’s telling.  Small lies multiply. People might turn out to be somewhere else than where they told you. Use your common sense.

Common sense, more than anything else, can help you avoid getting taken to the cleaners, the poorhouse, or worse–to jail.

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Money Matters in Couple Relationships: Getting Taken to the Cleaners, the Poorhouse, or Worse–to Jail

In my series of posts on Money Matters in Couple Relationships, I wrote several entries regarding how to avoid financial betrayal, and gave some general pieces of advice, as you can see there.

I warned in those posts against ignorance of financial matters in a relationship, much as a person might like to abdicate financial responsibility. But the issue arose again, and reminded me how urgent it is that each partner remain alert to and aware of money matters, when, the stock market being closed for the day, I was forced to look for other news on the radio, and came across the program entitled American Greed.

In case you haven’t yet heard the story of Steven Trantel I relay the outlines here, both because it shows what can happen if a person becomes truly desperate and because it highlights Stephen’s wife’s, Jeanne’s, mistake by remaining ignorant of her own financial situation.

Stephen Trantel and Jeanne Callahan married in 1994, and by 2003 lived quite comfortably in a fancy suburb of Manhattan.  And Stephen was the model husband–he worked long hours to support his family’s lifestyle, but then came home and pitched in on child care.  He was community-minded, too, acting as  a little league coach, and playing Santa Claus at the annual Christmas party. He volunteered at soup kitchens and Habitat for Humanity. But as a self-employed commodities trader, Stephen essentially gambled with his own money.

Crucially here, Jeanne hid no knowledge the couple’s financial picture. She understood, of course, that they were well-off,  that she could stay home with the kids without working, and the kids could go to private school–and Stephen never complained about these things. But she never knew their gross income, never looked at the bank statements, never even made a deposit or withdrawal.

Instead, Jeanne says,  “My husband sorted the bills and gave me an allowance.” [Jeanne writes about her story in a book entitled Disguised Blessings.] She didn’t have the first clue what their financial picture looked like, or even to begin to handle the family finances, should something happen to her husband.

And that is one of the things I hope to never hear another person say in their marriage. Perhaps Jeanne couldn’t have prevented what came later–but what if she could have, with a little bit of knowledge?

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Things were stressful on Wall Street, and in 2003 Stephen lost his spot on the trading floor. He never told his wife. Rather, each day he got up and left the house, as if he had a job. Jeanne said he left ‘for work’ at the same time each day, dressed in suit and tie.  He came home each night at the same time, too. Jeanne never suspected there was a problem.

And this ties back to the posts on secrecy, for Stephen said later that he felt he simply couldn’t tell his wife what had happened, even as bills came rolling in and he couldn’t make his payments. What went wrong, I’m forced to wonder, that didn’t allow Stephen to be open with his wife about something that preyed on his mind so ceaselessly? In fact, Stephen would later say that he committed his crimes to pay for his family’s lifestyle. Wouldn’t you wonder whether Jeanne, faced with the choice of tightening her belt or living with a criminal, might have chosen the former option? Yet Stephen never gave her the choice.

In an interview after his arrest, Stephen said, “I was just sitting in my truck looking out  the window. And I’m like: ‘I need money right now. What can I do where nobody’s  gonna get hurt?’ I just came to this epiphany that there’s no other way. If I  wanna hold on to everything, then I’ve got to steal money.”

So Stephen headed to the library and set himself the task of learning how to become–and this is true, I couldn’t make it up–a bank robber. He spent his time researching how to rob banks without getting caught. For example, he says, “I saw a statistic that 80% of the people who rob banks get caught from their  getaway car, so I took that out of the equation.” He didn’t use a getaway car.

Trantel was sensible about his plan–he would pick a guard-less bank and a time of day with few customers. He wore gloves plus a disguise (usually a baseball cap, fake moustache, and sunglasses). He would place a coffee cup near his truck, which he’d park near an alley. From there his plan was simple. He’s just walk up to a teller, hand her a note saying he’d have a gun and she should give him all the money in her drawer. Then he would walk to his truck, change, throw his disguise into a dumpster, pick up his cup of coffee, and calmly drive away.

Stephen would rob a total of 10 banks (for just over $60,000) and earn himself the title of Long Island Bank Robber before finally getting caught.

Jeanne had no idea where the money Stephen made on his heists was coming from, and, when her husband was finally arrested, she insisted it was a case of mistaken identity.

As they’ve taught us in Monty Python, “No one expects the Spanish Inquisition.” And no one expects their husband to be arrested bank robbery. But perhaps Jeanne could have expected some of the money difficulties she would face after the fiasco, had she known the first thing about her financial situation.

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Money Matters in Couple Relationships–Avoid Financial Betrayal: Getting Taken to the Cleaners, the Poorhouse, or Worse–to Jail, ct’d

Some more stories and what to watch out for:

A couple decides to go into business together. The husband has all the training–he offers practice management seminars for dentists. The word around town is that he’s an excellent dentist–and a strong teacher. The wife, who previously had worked at the front desk of his office, has money of her own and is ready to invest it.  She decides to help grow his company, and they franchise the business.  They agree, amenably, that because it’s her money, she’ll own 80%; he, with his skill and  work, will own 20%.

The husband makes a mistake I hope no reader of this blog ever makes: He never sees any documents. At the time of  the divorce, five years later, the wife claims entire business as hers–and has the paperwork to back her up.

Joe seeks counseling for several months, and during that entire time he obsesses that his wife is having an affair. She is out late 2-3 nights a week, and has no reasonable explanation of where she’s been. Despite my encouragement that Joe confront his wife, he is fearful of the consequences, and the situation continues to play out–until, faced with a financial mess, Joe realizes what Jane has been doing, night after night.

Jane’s affair has been with the gambling boats, not with another man, as Joe had feared. But the financial consequences of this are much more dire. Jane, no fool she, has been using cash advances on the credit card to fund her entertainment. Since cash advances have a much higher interest rate than normal expenditures, and Jane’s luck hasn’t been quite so good, Joe has been, well, taken to the cleaner’s.

Lance is a trader who has supported his family for several decades. Supported them nicely, in fact, until, on a fateful day, he makes a very large and disastrous trade that he can’t cover–and his trading career has come to a catastrophic conclusion. But here’s the truly devastating part–Lance doesn’t tell his wife. Instead he gets up early every morning,  leaves by 6:45, and doesn’t return until 3:30, disguising the fact that he has nothing to do and plenty of time to do it in. Lance is increasingly irritable whenever his wife spends money and starts nagging her about returning to work.

 

Are you getting some clues that might indicate something’s gone awry in family finances?

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Money Matters in Couple Relationships–Avoid Financial Betrayal, ct’d

Besides the more elaborate and dramatic financial narratives, there are scenarios that can be covered in several sentences, but that should serve as models of what to look out for, or what can happen to the person who isn’t looking out.

For example, an 80-year-old widow is filled with fear, rage, sadness and shame. She thought she lived a comfortable middle-class existence until her husband died, leaving her destitute. He had even cashed in his life insurance policy without telling her. She had no idea that their very existence was using up all their funds. Her apartment, clothes, meds, etc. are now paid for by her children.

Jerry, the working spouse of a couple, leaves the house later and later and comes home earlier and earlier from his job with no explanation.  When his wife asks about this new pattern, Jerry becomes irritable and complains that he does not feel supported.

Janie is married to a man in a cash business. Although she herself uses checkbook, her husband funds all his purchases from the stash in the upstairs drawer. Oddly, Janie has known about this for years before she enters my practice, yet has never thought to worry about the scenario–and how it might impact her should the government ever come looking for her spouse.

In another situation, the wife proposes a complex new business investment.  The husband, granted not the swiftest with money, but still, protests that he doesn’t understand.  He is brusquely brushed off with insults and hostility.

One couple lives [or did] in a fancy Chicago suburb with a mini-mansion of a house, beautifully rehabbed when they first bought it. She has long-since retired from her job in sales, and he heads out to work daily promptly at 7:00. Some things are a little odd, truth be told. This lovely house? It has almost no furniture. They haven’t bought something new for it in nearly 15 years, and some rooms have just fold-up chairs.

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And another thing, really, now that we think about it. The husband of course drives a Lexus.  But the car is 12-years-old. Because when push comes to shove, there is just one small chink in the armor: the stated income on their tax return cannot possibly cover the lifestyle expenditures of this couple.

And finally, Jack and Jill are long married, both for the second time. Jack, somewhat of a softie, secretly funnels money to Joel, their adult child who has never made it. Jill holds firm that the couple’s continued financial support of Joel only handicaps him further, so she is convinced he will do better, now that funds are cut off. She is surprised when he continues to flounder, and Jack is secretive about his support of his son.

The tables are turned, however, when it comes to Jane, Jill’s middle-aged daughter from her first marriage. Jane has struggled for years with alcohol and drug issues, and the family therapist, meeting with the extended family, has been firm that no more money should be forthcoming from any family members to fuel Jane’s addictions. In this case, Jack is completely on board with how best to deal with his step-daughter, and would be horrified if he knew the truth, that Jill supplies a steady cash flow to her own ill daughter. So Jill simply doesn’t mention it, and now the couple is on equal footing in its financial deceptions.

For next time, think of some warning signs to which spouses should be attuned.  When should your antennae go up if something is a bit off in your marital financial health?

I have my own ideas, but I encourage you to write in with suggestions–some of which you may even have learned the hard way.