A forensic accountant is generally an accountant with expertise in detecting financial fraud or manipulation in personal and business tax returns, bank accounts, investment accounts, retirement accounts, broker accounts, offshore accounts, cash, cryptocurrency, jewels, art, cars, yachts, airplanes, real estate, life insurance policies, and related financial documents. This financial investigation work is often referred to as tracing, financial tracing, asset tracing, or forensic accounting, and generally involves “following the money” by tracing a piece of financial information or data back to its source.

In divorce litigation—and especially in high-asset or high-net-worth divorces in which there is significant marital or community property—any financial manipulation or fraud of personal or business finances may have a significant effect on the marital or community property that is available for division, and on spousal support and child support payment amounts. One or both spouses in a divorce may hire a forensic accountant to discover any hidden assets or manipulated financial documents that may prevent the court from having an accurate accounting of the marital or community property assets and the spouses’ incomes.

In Rhode Island, forensic accounting is a recognized practice within the legal and financial fields, particularly in the context of divorce litigation. When dealing with high-asset or high-net-worth divorces, the role of a forensic accountant becomes crucial in uncovering any hidden assets or financial fraud that could impact the equitable division of marital property, as well as the determination of spousal and child support. Rhode Island is an equitable distribution state, meaning that marital property is divided in a manner deemed fair by the court, which may not always be equal. Forensic accountants assist by providing detailed financial analysis and tracing to ensure that all assets are accounted for during the divorce proceedings. Their expertise helps to reveal any discrepancies in personal and business tax returns, bank and investment accounts, and other financial holdings, which is essential for the court to make informed decisions regarding asset division and support obligations. The findings of a forensic accountant can be used as evidence in court to argue for a fair distribution of assets and proper support calculations.