Collecting on a delinquent debt can be challenging—particularly if a business or business owner has intentionally hidden assets. A recent report from the International Consortium of Investigative Journalists (ICIJ) revealed that an astounding number of billionaires and big businesses are hiding money offshore. That finding for most of us is not a shock. What’s more shocking is how common it is––to hide assets––among non-billionaires. The practice is far more common than many people realize.
This raises an important question: How can a New Jersey creditor collect on a debt if a company is concealing assets? The answer depends on the specific circumstances of the case—but there are a number of different tools available to uncover hidden property. Here, our New Jersey debt collection lawyers discuss some of the key strategies that creditors can use to find a debtor’s hidden assets.
Debt Collection: Four Tools to Uncover a Debtor’s Hidden Assets
1. A Judgment Debtor’s Statement
The New Jersey debt collection laws provide some important legal protections (and legal tools) for creditors. When a creditor obtains a judgment against a debtor, they are entitled to some information from the debtor party. Indeed, in New Jersey, debtors are often required to make comprehensive disclosures in the form of a ‘Statement of Assets” once a judgment is entered.
Within this statement, a debtor should provide a detailed list of all property and assets. This is the starting party in many debt collection cases in New Jersey. Unfortunately, debtors are not always cooperative—they may provide incomplete or inaccurate information. Still, the Statement of Assets can provide some useful details to get started. In some cases, a debtor may be held in contempt. For refusal to offer any information regarding their assets.
2. Investigate Public Records (and Private Records)
Locating hidden business assets generally begins with a comprehensive investigation. In most cases, this starts with a review of all available public records, potentially including real estate records, business records and information, public tax records, and internet search results. By gathering and organizing all of the documentation that is available, you may have a better idea of where to look for hidden assets. An experienced debt collection investigator can also help you take action to start to look for certain types of private or quasi-private records that may be accessible.
3. A Deposition in Aid of Execution (Judgment Debtor’s Examination)
When there are questions about the information provided by a judgment debtor—either because they provided no statement of assets or there is reason to believe that the disclosure might be inaccurate or incomplete—a creditor may be entitled to conduct a deposition in aid of execution. This is also sometimes called a judgment debtor’s examination. It is an opportunity to ask a debtor party direct questions under oath—and it can be a very effective tool in locating hidden assets.
4. Subpoena of Records Held by Third Party
There may be cases in which a business debtor consistently fails to provide any useful information regarding their assets. If you have a suspicion regarding the location of certain hidden assets, an NJ debt collection lawyer may be able to help to get a subpoena of records held by a third party, including a bank or another financial institution. In other words, a creditor may be able to get the information needed to uncover a hidden debt from a third party.
Your NJ Collection Lawyer Can Help Locate a Debtor’s Hidden Assets
With complicated debt collection cases, winning a judgment is only half the battle. Creditors need to be able to business assets that they can collect upon and execute the judgment. Unfortunately, businesses and business owners can throw up a number of different roadblocks—particularly if they were willing to conceal funds, property, and assets. The most effective strategy to locate business assets and collect on a delinquent debt depends entirely on the specific circumstances.
While judgment debtors are required to make full and fair disclosures, the reality is that they do not always do so. An experienced New Jersey debt collection lawyer will be able to review your case and help you determine the best course of action. Among other things, this includes reviewing all available financial records, working to obtain additional documents/information, and devising a plan of action to locate debts that may be improperly hidden by the judgment debtor.
Resourceful New Jersey Collections Attorney to Find a Business’s Hidden Assets
At Snellings Law LLC, our New Jersey debt collection lawyers are skilled, effective advocates for creditors’ rights. With a deep knowledge of the collection laws, our firm gets results. If you have any questions about finding hidden business assets, we are here to help. Contact us today for a fully confidential, no-obligation initial consultation. From our office in Parsippany, we represent creditors and debt collectors throughout the State of New Jersey.