Women whose husband’s have hidden money from them during their divorce are trying a new tactic. They are trying to use the federal Racketeer Influenced and Corrupt Organizations Act—RICO—which famously took down the Teflon Don—to nail their wealthy husbands during (and after) divorce battles. Many wealthy men hide their money in various ways during a divorce—from being the “phantom owner” of their company or business to hiding money offshore, hiding money in valuable assets like gold, diamonds and art and real estate investments—usually with the help of others.

Patricia Cohen, the ex-wife of billionaire Steven Cohen, was the first to use this tactic in 2009. She claimed that her husband ran his hedge fund SAC Capital, like a racketeering enterprise, replete with money laundering, insider trading and bank fraud.

A judge threw out the civil RICO charge last year—but other women in New York and New Jersey have followed suit using the statute in a similar way.

Matrimonial attorneys are keeping a close eye on three RICO-linked divorce cases in New Jersey federal courts to see if one of the suits will be successful.

“If someone develops a niche to pull off all these cases in federal court, the federal court is going to get swamped with all these RICO cases,” predicted a divorce attorney.

One of the cases is a $200 million suit filed by Rachel Alintoff, who says state judges favor “men with deep pockets and big law firms.” Her suit accuses a number of lawyers and other defendants of colluding with and conspiring to hide her husband, Bryan Alintoff”s, income and assets. In court papers Rachel says she’s living below the poverty line, while her ex rakes in a $500,000 salary.

This sounds familiar to too many of us!

One Response to New Divorce Tactic