Episode 71: Divorce Money Guide with Tracy Coenen, CPA, CFF, MAFF
Forensic accounting services are a necessary and valuable part of a divorce case - especially when it comes to property settlements. However, many divorce matters need a forensic accounting expert but cannot afford one. Tracy Coenen has been working with clients of divorce matters for over 20 years to find hidden assets and uncover understated income. Now, she is taking her expertise and experience to the next level and making it available to the general public in the Divorce Money Guide. Divorce Money Guide provides the exact action steps to uncover hidden financial fraud in a divorce matter. It’s designed to offer clients peace of mind and detailed instruction of everything they need to figure out what's rightfully theirs.
Tracy is known as a no nonsense forensic accountant who delivers the “real deal” to her clients. Let’s face it: When your money is on the line, there is zero time to dance around an issue. Her passion lies in helping people find answers. Answers to questions like “Where did our money go?”
After years of watching those who couldn’t justify the cost of a forensic accountant lose thousands of dollars in their divorces, Tracy knew she had to create a solution. That’s why she put her heart into creating the Divorce Money Guide.
Tracy works as a forensic accountant through her firm, Sequence Inc. Forensic Accounting. She has been doing fraud investigations for more than 25 years, and is a CPA (Certified Public Accountant), CFF (Certified in Financial Forensics), and MAFF (Master Analyst in Financial Forensics). Tracy testifies as an expert witness around the country.
RESOURCES AVAILABLE FROM WORKMAN FORENSICS
Order Leah's new book Data Sleuth on Amazon!
CONNECT WITH TRACY COENEN
LinkedIn: Tracy Coenen
Website: www.divorcemoneyguide.com
CONNECT WITH WORKMAN FORENSICS
Youtube: @WorkmanForensics
Facebook: @wforensics
Twitter: @wforensics
Instagram: @wforensics
LinkedIn: @workmanforensics
Subscribe and listen to this and more episodes of The Investigation Game on Apple Podcasts, Android, or anywhere you listen.
Transcript:
Leah Wietholter:
Hi, I'm Leah Wietholter. And this is The Investigation Game Podcast.
Leah Wietholter:
Welcome to The Investigation Game Podcast. I'm Leah Wietholter, CEO and founder of Workman Forensics in Tulsa, Oklahoma. Joining me today is Tracy Coenen. Tracy is known as a no nonsense forensic accountant who delivers the real deal to her clients. Let's face it, when your money is on the line and there is zero time to dance around an issue, her passion lies in helping people find answers, answer to questions like, where did our money go? So after years of watching those who couldn't justify the cost of a forensic accountant lose thousands of dollars in their divorces, Tracy knew she had to create a solution. That's why she put her heart into creating the Divorce Money Guide. Tracy works as a forensic accountant through her firm Sequence, Inc Forensic Accounting. She's been doing fraud investigations for more than 25 years, and is a CPA, certified public accountant, CFF, certified in financial forensics, and MAFF, master analyst in financial forensics. Tracy testifies as an expert witness around the country. Thanks for joining me today, Tracy.
Tracy Coenen:
Thanks for having me back, Leah. It's always fun with you.
Leah Wietholter:
I feel the same. Okay. So today we're going to be talking about your new product Divorce Money Guide. But before we get into that from a couple different angles, I want to first start with your experience in divorce cases. You have been on the podcast before to talk about working a billionaire divorce case, and then also MLMs, which is a great episode for anyone just now checking out our podcast. So you've worked billionaire divorce cases. You've worked a whole host of everything else in between. So let talk about some of those. What types of divorce cases do you find that you work the most?
Tracy Coenen:
The divorce cases I work the most are the ones where we're either trying to figure out where the money went, whether there's missing money, or where we have people whose incomes are off the charts, literally. So most states have charts for child support guidelines that involve, typically, percentages of income and things like that, how many children are there? What percentage of income? And how much time is the child spending at mom's house versus dad's house?
Tracy Coenen:
So when people make too much money and they're off those charts, I do something called a lifestyle analysis to figure out exactly how much money are they making because in most of those cases, they're making so much money that it's not a straightforward earning situation. It's usually not they have a predictable paycheck and we could figure something out. There's something else going on. And so I am looking at, either how much they make, because that may play into it, but in many cases like that, I'm looking at how much they spend. So what does the lifestyle cost? Because the idea, in general, is that the kids and the spouse are entitled to continue living a similar lifestyle after divorce. So if they were in a luxury house before the divorce, we want to figure out how much that costs them every month so that an amount of money can be paid in support that would allow the ex-spouse and the kids to live in a similar type of house. Now, it doesn't have to be the same size, necessarily, doesn't have to be the same location, but if it was a luxury house before, we're going to look towards it being a luxury house going forward of an appropriate size.
Leah Wietholter:
Okay. So in these situations, what types of documents or information are you most often request?
Tracy Coenen:
So just like regular fraud investigations, I am very heavily focused on bank statements, credit card statements, investment account statements. So I'm really tracing the money just like a fraud investigation. And like I said, some of these divorce cases, we are trying to figure out where the money went or if one of the spouses is hiding money. And so, at the same, time I'm doing this thing to figure out what do the numbers look like for support. We're also looking for, is there any money missing, or has money been spent on affairs, or addictions?
Tracy Coenen:
In one case we uncovered a rental property that the husband had in his name only in another state that the wife never knew about. And we uncovered some evidence of that in the form of an electric bill that he paid out of the wrong account. He had a separate account for this property to try to conceal it, and he accidentally wrote the check out of their bank account. Wife never saw it until I came through and I said, "Hey, you're in Illinois. A check was written for a utility company in Arizona. Do you have any reason why that would happen?" And usually, in normal cases, I'm expecting them to say, "Oh, yeah, his mom and dad live out there and he must have covered it for them or something like that." And she's like, "No, never heard of it." Got a private investigator involved, and he uncovered the real estate in Arizona. Super fun to be able to do that. Back to your question, it's all about the statements and all about tracing the money.
Leah Wietholter:
Yeah. So going back to this story, I got to go back to the case story just for a second, and follow-up question here. What was the property for?
Tracy Coenen:
It was a rental property. However, if I had to guess, he probably had a girlfriend living in it. I mean, that's what we usually see. So it was probably a rental property that coincidentally a young lady lived in.
Leah Wietholter:
In our cases, we'll also look at finding hidden assets and so forth. And the way we describe it is to make sure that property settlement, there's this complete marital balance sheet to divide between the parties. But you said also, that whenever you're looking through these statements and so forth, you might find evidence of affair or addictions or things like that. How does that play into an individual's case?
Tracy Coenen:
Well, in divorce cases, we talk about marital waste or, in some states, they use the more proper term called dissipation. And so if a spouse was spending significant sums of money for a non-marital purpose, then that can be recaptured. So let's say the wife had a drug addiction and blew $100,000 on drugs. Half of that, $50,000, really was husband's money. And so we want to try to recapture that. Obviously, the money's gone on the drugs. It's never coming back. But if they are dividing other accounts, let's say there's a retirement account to divide, the judge could say, "Okay, husband is going to get an extra $50,000 of that retirement account, which I otherwise might have divided 50/50." And so even though in most of the cases, whatever money was spent inappropriately is just gone and never coming back. I do see that there are opportunities to recapture that when they are dividing the equity in the house, dividing a retirement account, or maybe there is another investment account somewhere that was untouched. And so there is a chance to get some of the money back.
Leah Wietholter:
I think the focus of the client in our cases is always on, well, he's cheating, or, well, he's doing this. But from a divorce standpoint, that's why I was wanting to know how you've used that because, from the judge's standpoint, there were problems in this marriage. This is why you're in front of me today. But the client always wants to talk about that drama when, as an expert or forensic accountant, we're looking at how do we capture this to make sure that this... I mean, ultimately, it's all about the property settlement or future support.
Tracy Coenen:
Right. And so we're also always looking for instances where money may have left an account and we don't know where it went. So there was a $10,000 withdrawal out of the bank account and we have no idea what it's for. And so that goes on a list of money that's unaccounted for. And whoever signed that withdrawal slip, in my mind, has to account for that. And if they can't show where that money went, then our assumption is that it got hidden somewhere, spent for something inappropriate, and half of that needs to come back to the person that I'm working for.
Tracy Coenen:
Now, that being said, a case that I have been working over the last year, there were all sorts of huge cash withdrawals. And they were all turned into cashier's checks that all went to contractors because they did a massive home renovation. And so there was an explanation for all of them. But in that case, it was super important for me to get the underlying documentation to prove that that's what each of those were for because husband was the one who did the withdrawals. If he was trying to hide money, it would've been a great time to do one of those withdrawals thinking his wife would assume it was for the renovation. So I made sure every single one of those was tied back to a cashier's check made out to a contractor. And then I saw an invoice from the contractor that matched up in amount.
Leah Wietholter:
Yeah. Any time, on any case, and this is where it goes back to how you're saying working a divorce case is similar to working a fraud case, just anytime I see a withdrawal slip that then leads to a cashier’s check, it's just always a red flag. I don't know. Are you the same way?
Tracy Coenen:
Absolutely. Unless there is an explanation that makes sense. Like in this case, I mean, they were doing all these renovations and the contractors were requiring it. I mean that I don't really have a problem with, but I'm still going to stay on high alert to make sure that I can tie out all of them. The cashier’s checks, the repeated ATM withdrawals. I've had cases where it's someone is going to the ATM and getting out $300 every single day, or twice a day if their bank allows it, and they normally hadn't spent cash on anything. They'd normally use their credit card for everything.
Leah Wietholter:
Yeah. That's interesting, looking at those patterns, for sure. Okay. So to me, that's part of that hit looking for hidden assets, looking at the marital balance sheet, making sure that's complete. What about looking at understated income for maybe spousal or child support? What types of information do you look at for those types of situations?
Tracy Coenen:
I want to make sure that everything is being captured in terms of whether there's investment income from either investment accounts, or maybe rental properties, or things like that. Those are the things that can get overlooked. Again, if we're working with high earners and one spouse doesn't have any involvement in the day-to-day finances, those things could be missed. So I want to look for that. In some cases, there might be consulting income. There might be some investment like, "Hey, I put 25 grand in my buddy's company." If I find evidence of that, I want to follow up on that. What's that worth now? Were there any profits that were paid out? And things like that.
Leah Wietholter:
All right. I want to talk about Divorce Money Guide, but before we do that, let's take a quick break.
Leah Wietholter:
We love fun projects around here at Workman Forensics, and our newest adventure is taking place in the form of an escape room. Novel Mysteries is our first escape experience based on the novel Blood on the Mother Road: No Place to Hide by Tulsa author, Mary Coley, the 2022 Oklahoma Book Award for fiction recipient. Booking opportunities for this exciting immersive experience are available at novelmysteries.com.
Leah Wietholter:
Welcome back to my conversation with Tracy Coenen. Okay, Tracy, we need to talk about the Divorce Money Guide. First of all, I want to know what inspired you to make this product. And I'm guessing that, as you answer that, you're also going to answer, what problem does it solve and who do you hope to help? So all of those things wrapped up into one for you. So what inspired this? What problem does it solve? And who are you hoping to help?
Tracy Coenen:
As I talked about, I do forensic accounting work and divorces typically for people who are higher earners, have a higher level of assets, have more risks in that regard. And so in doing my work, I got frustrated because I was receiving phone calls and emails from average people who had suspicions about what was going on with the money in their marriages, who are now getting divorced. And I don't have the ability to help them for a number of reasons. Some of them can't afford the help. Some of them just don't have enough money on the line to justify the cost that it would be to have someone like me help them. So all sorts of reasons like that, why it's not a fit for me to do the case. And I got tired of telling people, no.
Tracy Coenen:
I was able to point some people to resources on the internet and some articles I've written, materials that you've got, things that would point them in the right direction to start doing their own digging into the dollars, but I was to a point where I was feeling that wasn't enough. And I said, "Why couldn't I put together a resource for them that would walk them through step by step, by step, what they could do as a person who maybe has no expertise with numbers, no accounting background whatsoever, and help them find something in the numbers, if there is something there, but at the very least also help them save money in their divorces?" So if they were able to get all their account statements together on their own, get all the tax returns on their own and save their attorney the time from doing that, they could save hundreds, maybe even thousands of dollars in their divorce.
Leah Wietholter:
Yeah. I love it. First of all, what does the product include? What is the Divorce Money Guide?
Tracy Coenen:
The Divorce Money Guide is an online handbook. There's 10 steps. Once you get into it, every step has an introductory video that says, "Here's what we're going to do in this step. Here's, what's really important for you to remember." Then there are written materials for each step, looks like a chapter of a book narrative format that walks them through exactly what they need to do. And there's a video that goes along with it. So if you're not much of a reader, if that's overwhelming to you, just watch the video instead, or you could do both. So in the video, I walk them through exactly what's in the written materials. Here's how you get your tax returns from the IRS. Literally, step by step, by step. And then there's worksheets that go along with the steps. So here's a worksheet to help you keep track of which bank statements you've gotten and which ones you still need to get.
Leah Wietholter:
So in the workbook, what types of things have you prepared that help people walk through these steps? Or what's an example?
Tracy Coenen:
Starting at the very beginning, I have a worksheet for the timeline of events. So something that may be simple to you or me, which is putting together really important dates when big money things happen. So when did you buy a home? When did you buy a car? When did you borrow money from your in-laws, or maybe change a job and get a different 401k? All of those things. I want someone to be writing a list of because if your divorce goes on for six months, a year, three years, four years, divorces can go on for a long time, and I feel like memories fade. And so to be able to have that comprehensive list to go back to is really helpful to the person getting divorced. So there's a worksheet that they can fill out to help get those dates in order.
Tracy Coenen:
As I mentioned, there's a worksheet for gathering your bank statements. There's one for gathering your tax returns. There's a worksheet for looking at your bank deposits. So one of the simple things that I have people do is look at a year's worth of bank statements and look at the money coming into the account every month. And is that correct? Are all the paychecks there? Was there other money that you know of? We sold a car and that money should have been deposited, things like that. So there's a worksheet to guide them through looking at those deposits.
Leah Wietholter:
So your comment about looking at the deposit analysis and looking at are all of those deposits that somebody expected there reminds me of a case that I worked several years ago, that this lady came in and just had noticed a lot of irregularities, and they didn't have money, but yet, her husband's job should have afforded them an extremely lavish lifestyle because he was the only one in his field that did this, and he was in medical profession. So she came in and I started looking at the deposits from payroll. And she told us how much he made. And let's just say that it was $250,000 a year or something. He was only making payroll deposits for about 120 to 150. So she didn't really want to dig any more into the details than we were working with the private investigator. And he said, "Well, let's just bring him in and interview him."
Leah Wietholter:
So we're all sitting around the table and start asking him questions about these deposits, among other things, because he had some really strange expenditures. He was paying on a sports car loan for someone who was not related to their family. So it was extremely strange spending. But in her mind, she's thinking, if he's preparing for divorce or something, then why would he be spending all of this? But the more I started thinking about, why would someone be paying for someone else's sports car loan? We started believing on our team that we might have a second family situation going on, which what's weird is that it would've been in the same town. We're not talking about Illinois and Arizona as in your case.
Leah Wietholter:
But I remember pulling her to the side... We took a break from the interview and I pulled her to the side and I said, "Look, he's only depositing about half of his payroll into your account. We need to get those payroll stubs and statements so that we can see where these other funds are going." And she said, "Well, if he makes 250 that's about this much per month. I mean, taxes are a lot, so it's probably fine." And I thought, "No, no, no, no, no. Do this math yourself." Anyway, I bring that story up because I'm so curious about it still because after this interview, we were asked to not do anything else, and she just decided she was going to live with what was going on.
Leah Wietholter:
But with what you're talking about, being able to walk people through this themselves, she would've been able to have looked into this on her own to satisfy her own curiosity, first of all. But then, maybe, maybe if she had done this analysis herself, she would've seen what I was seeing eventually. I mean, I don't think she wanted to see it, if I'm being honest. Anyway, for those types of reasons, that's, in my experience, why the deposit analysis is so important in a divorce case.
Tracy Coenen:
Well, and I had to ask myself, how many people who buy the Divorce Money Guide are going to go all the way through? And is someone going to do this deposit analysis all the way through for a year? I think probably not, but at least starting the exercise and giving things a once over, if there is something really big that's off, I think people at least be alerted to that. And then, if they need additional help, they can find it.
Leah Wietholter:
And the other thing that I love about the timeline worksheet you mentioned is that that can be given to the attorney, or maybe if an expert does have to be hired down the road, to provide that to them because that's so pivotal to what you and I do. That's so pivotal to what the attorney's going to file or how they can help them the best. And I know that there are some very organized attorneys out there, but so often, they're working on so many different cases.... I mean, I find myself doing this. If I don't have a timeline for that case and then it gets put on the back burner for a while, then I don't remember when the house was sold versus when he bought another car. I'm not going to just know that offhand. So having the client prepare that on their own, even before they've hired an attorney or anywhere in that process, could just be extremely valuable.
Tracy Coenen:
Right? And I think I forgot the most important worksheet. I didn't hit all of them, but the most important one I think is the discovery checklist. And so it is a lengthy list of all the financial documents you might need for the financial part of your divorce because I don't think that people are thinking about things like get your life insurance policies, copies of those, if you have them. And then, that's important when you get to the end of your divorce because you should probably be changing beneficiaries in your life insurance policies. So there's all sorts of reasons why all these documents might come into play. And I don't think people just know what they're going to need, so let's make a checklist for them.
Leah Wietholter:
And it's so often that we get calls. Well, we got a call like this yesterday. It was about child support, actually. But this individual saying, "Hey, my hearing is on July 7th, and this was June 7th, and we don't have all the documents yet." And so having a checklist like the discovery checklist at the beginning of a case can help them grab all of that while it's fresh on everyone's mind, everyone's having to go pull all of these things anyway, and then you have that for any future situations, like maybe with a child support calculation down the road or whatever, where you just need to update information instead of having to get all of it when you're hearing deadlines are closer together and all of that. It's just crazy. I know you've had these phone calls too, where people are calling us for help, and they have incomplete documents, and their hearing or their trial is a few weeks away.
Tracy Coenen:
Well, exactly. I just finalized a report in a damages case, economic damages case. I finalized it a couple days ago. And the thing is that... So the plaintiffs had set out their damages, and I was retained by the defendants to verify, and critique, and all that stuff. And there were documents that we needed to verify their damages that nobody ever asked for, and discovery is closed. And so I was telling the attorney, "If I had been brought into this six months ago, some of these numbers are big and some of the documents that we need to verify them are pretty simple that they would have on their end. And I could have just had you pushed to get those, but now it's too late." So cases across the board, as a forensic accountant, we run into this stuff all the time.
Leah Wietholter:
This is so true. So true. So basically, we need a money guide for every type of case or some guide for every attorney for every case. Ask for all these things at the beginning, please, because then we can help you more. Okay. So changing angles on this just a little bit, from the product itself to the creation of this project, how did you get this product up, running, and ready to launch as quickly as you did? What did that look like? And what was that timeframe?
Tracy Coenen:
I had the brainstorm, and literally started running immediately because I was just like, okay, I feel like this is a great idea. I did the research, found there was nothing out there like it. There's some products out there about finances in divorce, but they're all focused on creating a budget, thinking about your savings long term, putting together the marital balance sheet. All of those, things super important, but none of it was focused on what if you suspect fraud? Or how do you get an understanding of where your family's money has been spent? Even if you don't think that there's fraud, if you're the spouse who hasn't been involved with the money, you might want to get some comfort about what have we been spending money on. And so finding nothing out there like that, I said, "Okay, if there's a need, I can do this. Let me figure this out."
Tracy Coenen:
So I spent about two or three weeks. I feel like completely wasting time because I was trying to find the right marketing people could help me launch a product. And I was explaining to people what my concept was, getting a deer in the headlights look until I finally found my person, and then felt confident going forward to create the product. And so it took me 87 days to complete all of the content. And that's all of the videos, professionally produced videos, all of the written materials, all of the worksheets. And it was a matter of really setting goals for myself each day. So I broke it down into pieces. There's 10 steps, and so it's work on a step at a time type of thing. We got the photo shoot and the video shoot done early, so there was time for editing and all that stuff. But man, I'm tired. It's a lot.
Leah Wietholter:
I can only imagine.
Tracy Coenen:
I've had to rely a lot on other people, which having been a solo practitioner for 22 years now, I don't rely on other people a lot. And so this was new for me. So between my marketing person, my web designer, the photographer, the video person, I've been relying on outside people. And it's a great change for me.
Leah Wietholter:
Yeah. How exciting. What are some things that you've learned about product development in these 87 days? Top few things.
Tracy Coenen:
You don't know what you don't know. The product is done. The website is there, but if I were starting over today, now I know some things, and I would do it a little bit different, but that's okay. It's fine. It's a fantastic product, and it's out there. So you don't know what you don't know. But I do think having the professional help is really important, but what I think was key for me in that professional help is my web designer person is a specialist in getting e-learning courses up and running. And so I think any regular web designer would not have been as good of a choice because she was able to say, "Here's what your sales page needs to look like. It has to have these elements, and I'm going to put that all together because I know that this is what works." She understands the SEO behind a website of this type. She understands the email sequence that potential buyers need to see. Every two days, they're going to get an email until they reach a certain point and things like that. I think that's probably my best advice, is working with people who know the space that you're trying to be in with your product.
Leah Wietholter:
So while a little different, when we've been launching the escape room for a while, I forgot what it was like to start a new business. I've launched several products like our game or our Get Organized Workbook, but I forgot what it was like when people don't know you in a space. And so your comment about you don't know what you don't know, I had forgotten what it was like for people to not know me. That's such a strange thing to say because I've been in this niche so long. So whenever we would launch products, people at least knew who I was and, "Oh, this makes sense that she would be teaching people how to do work a fraud investigation through a game." But now we're entering the game space, and this week, I've been realizing, oh, I forgot about just the incline that we have to overcome, but that's a little different for you because you've been in this space so long.
Tracy Coenen:
No, it's not different. No, you're so because here's the thing. As a forensic accountant, my clients are attorneys, and I market and have for 22 years directly to attorneys. So the attorneys find me on behalf of their clients. This product is a direct to consumer product. And so I don't really have the credibility with consumers. They don't know who I am. And so I started an Instagram account with zero followers, and I'm trying to build that up now. And so the whole social media thing is going to a completely different audience. So I'm starting from scratch.
Leah Wietholter:
That is true. You're right. The similarity between these two things are B2C, that business to consumer relationship, where even though we don't necessarily solely work with attorneys, it's just totally different. Workman forensics, we can post a few days a week and that works for us, but for something that's so business to consumer, once you've played an escape room, you might go back and play the second escape room that's built, but you're not going to do that first one again. So it's just this constant social media grind, I guess. I don't want that to sound negative, but it really is what it is. So I can definitely see the similarities there.
Tracy Coenen:
Well, it's interesting because the whole social media thing is a learning curve for me. On Instagram, I've never been on Instagram before. But what I found in researching doing this product that, basically, for this type of product, there is a set formula for the marketing and the social media. And if you're willing to put in the work and be consistent about it over a period of time, you will get the results. And so I had to commit to stepping outside of my comfort zone with that and knowing that, you know what, for the next six months to a year, I'm going to have to be an Instagram sensation in my own little world and post my little silly dancing reels, which people seem to enjoy, but that's how you get more followers. And it is a very repeatable process. But again, it's about the consistency and doing it the right way.
Leah Wietholter:
Yes, I love your reels. If you don't follow Tracy on Instagram, you should because she has great reels and videos. They're super cute and make me chuckle sometimes. So thank you, Tracy, for stepping outside your comfort zone because I do get a smile in the middle of my day when I see your posts. They're really great.
Tracy Coenen:
You have to tell them, Divorce Money Guide on Instagram.
Leah Wietholter:
Yes, yes. I was just going to say, if our listeners want to connect with you, follow you, learn more about Divorce Money Guide, what are the best ways to do so?
Tracy Coenen:
On Instagram, Divorce Money Guide. And on the web, divorcemoneyguide.com.
Leah Wietholter:
Love it. Tracy, thank you so much for your time today, and I hope to talk to you again soon.
Tracy Coenen:
Thanks for having me for the third time.
Leah Wietholter:
I know. We need to give you, like on SNL, your five timers jacket. You need a three timers jacket for being on the podcast. I think that might need to be a thing.
Tracy Coenen:
I'll take it. Thanks again. And best of luck with the escape room.
Leah Wietholter:
Thank you for listening to The Investigation Game Podcast. For more information on any of the topics brought up on this show, visit workmanforensics.com. If you enjoyed our show, please be sure to subscribe and leave a review. You can also connect with us on any social media platform by searching Workman Forensics. If you want to learn more about using data and forensic accounting engagements and fraud investigations, make sure to check out my book, Data Sleuth, available on Amazon or anywhere else you like to buy your books.