Socialite Fights Hedge Fund Millionaire Over $50,000/Month Child Support

A recent New York Times article discussed a scandalous affair involving hedge fund millionaires, a love child and a potential gold-digging socialite. No, the article was not a review for the latest episode of The Young and The Restless, it’s about a salacious custody battle taking place in New York.

The story begins in Aspen, Colorado, a great place for such a scandalous tale to start. It was there that Warren Lichtenstein, a Wall Street moneyman, met Annabelle Bond, a British socialite and famed mountain climber who once conquered Mt. Everest. The two began a fast and furious relationship and, five years ago, had a child together. Though they briefly were engaged, they never got married and broke up soon after their daughter was born.

Ms. Bond, not one to nurse a breakup for long, soon found herself in Aspen meeting yet another Wall Street financier, this time, Andrew Cader, a former Goldman Sachs executive and owner of the Tampa Bay Rays. The two began a new relationship right as Ms. Bond and Mr. Lichtenstein started a courtroom fight over child support for their daughter.

Ms. Bond decided to leave America and return to Hong Kong, where she was a citizen, and filed suit there against Mr. Lichtenstein. After a prolonged child support fight, the Hong Kong court ordered Mr. Lichtenstein to pay Ms. Bond $41,800 per month in child support as well additional money for school expenses, tutoring, medical bills and travel. Experts say the child support award was one of the largest ever issued by a Hong Kong judge.

While the original child support dispute is over and done, Mr. Lichtenstein recently caught wind of potential financial fraud perpetrated by Ms. Bond, something that he believes should justify a sharp reduction in the amount he pays in child support. According to Mr. Lichtenstein, Ms. Bond left him and immediately took up with Mr. Cader. Mr. Lichtenstein claims that Cader has conspired with Bond to hide her true financial condition and life of privilege by disguising monetary gifts as loans.

For example, Mr. Lichtenstein recently learned that Ms. Bond and their daughter have moved into a home in an upscale area of Hong Kong that is being rented by Mr. Cader for $26,000 per month. However, Mr. Cader has structured this lease as a loan rather than a gift. Additionally, Cader supposedly has given Ms. Bond more than $3.5 million in cash that has also been designated as a loan. Mr. Lichtenstein argues that this money represents gifts to a lover and not a loan and that the two have conspired to lie about Ms. Bond’s financial situation to extract more money in child support and also to avoid Mr. Cader having to pay gift taxes on the money.

The case is currently before the Federal District Court in Manhattan who will now have the pleasure of unraveling this web of intrigue.

If you find yourself facing the prospect of complicated divorce and have questions about your rights and options, contact an experienced Ohio family law attorney who can help guide you through the difficult process. Count on the expertise of Twinsburg family law attorney Carol L. Stephan.

Source: “Millionaires Clash Over Socialite’s Child Support Claims,” published at NYTimes.com.

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Treasury Department Decision May Leave Those Behind on Child Support Penniless

Posted on: June 1, 2012

According to an article in USA Today, a big, though unanticipated change is in the works that could severely impact those behind on their child support payments. The change is the result of an attempt by the Treasury Department to reduce money spent by mailing out paper checks. The federal government will begin making government benefits payments electronically in March of 2013. This means that the paper checks that many rely on to shield a portion of their monthly income from states attempting to collect back child support will disappear.

States have long had the power to put a freeze on the bank accounts of those who are behind on their child support obligations. A relatively recent ruling by the Treasury Department also permits states to freeze Social Security, disability and veterans’ benefits that appear in the delinquent parents’ bank accounts. Once the decision to eliminate paper checks is implemented, some 275,000 people could lose access to all of their income.

This presents huge problems for a certain segment of the population, typically poor men substantially behind on their child support payments. There are plenty of instances where such payments are decades old and involve children who have long since grown up. Much of the money owed is for interest and accumulated fees. Of the money that is collected most will go to the states, not to the children of the men who were owed the money. States are authorized to retain this money as repayment for the years they spent providing welfare services for the children.

Beginning next March the Treasury Department will deposit all federal benefits directly into bank accounts or load them onto prepaid debit cards. No matter which method, state governments will then be allowed to access the money. States are currently allowed to garnish 65% of government benefits an individual is entitled to before they are disbursed. This same limit will not apply once the money has been wired to an account (or a prepaid debit card).

Though the goal is a good one, the chosen method will likely be counterproductive. Many of the men on the receiving end of this new payment system are already facing financial devastation in the form of eviction, foreclosure and aggressive bill collectors. People who owe large amounts of child support are almost exclusively poor and the numbers tell the tale: among those owing $30,000 or more, three-fourths had either no reported income or income of less than $10,000. By allowing states to seize their remaining income stream - federal benefits - these men may very well be left penniless.

Though there may not be much sympathy for the people behind on their child support payments, it’s important not to rush to judgment with overly punitive measures. If you find yourself facing the prospect of divorce, contact an experienced Ohio family law attorney who can help guide you through the difficult process. Count on the expertise of Twinsburg family law attorney Carol L. Gasper.

Source: “Rule could leave poor, delinquent dads with no income,” by The Associated Press, published at USAToday.com.

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