Millennials have grown up, and while they were busy revolutionizing the technology sector with smartphone applications like Venmo, the law has not adapted to the changing realities of how people interact. Venmo is a smartphone app, but it can be used as a tool by devious parties to the detriment of spouses and children.  It uses a person’s Facebook account to verify their identity, and to produce a list of people with whom that person can send and receive money. After populating this list, and verifying identities through Facebook, Venmo syncs up with a person’s bank account, where it can deposit and withdraw funds with ease.  Once set up, a party is not limited to exchanging funds to only their Facebook friends, but can receive funds from anyone, including employers and buyers of goods. If this transfer was instantaneous, there wouldn’t be a problem, Venmo would simply serve as a bridge, linking two bank accounts, similar to a direct deposit.

However, Venmo is not a bridge, it is a bridge with a parking lot in the middle of it.  Money is sent from the transmitting bank account, received and held by Venmo, and then only upon instruction from the receiving party are funds transferred from Venmo into the receiving bank account.  This payment “trigger” is the issue.

In the world of family law, Venmo is a problem that has not been fully realized yet.  More employers are paying their employees through Venmo, particularly in the wedding industry (planners, DJ’s, florists, bakers, professional photographers, etc.).  If that employee never instructs Venmo to deposit the funds received as wages into the receiving bank account, a problem arises.  The party’s bank account would show a zero balance, when in reality, Venmo could be holding thousands of dollars on the employee’s behalf.  In the case of a wedding photographer, a single day’s shoot could easily yield $3,000.  If that photographer worked every weekend in a month, there could be $12,000.00 held in Venmo that is not accounted for. That party can essentially park assets in Venmo, wait for their court date or a final order to be signed, and transfer funds upon the entry of the order (or thirty days later if they are smart).

Venmo evades traditional discovery. Through the tactics above, it can be used to hide community assets in a divorce, or to minimize income in child support amounts in suits affecting the parent-child relationship.  The only possibility of finding funds held by Venmo, is to conduct exhaustive discovery, which is expensive, easily costing a client at least $5,000 to request, respond to, and evaluate.  Most attorneys of clients seeking more economical representation use discovery as a tool of last resort, and rely solely on Rule 11 agreements, verified inventories and appraisements, pay stubs, and bank account statements.

Why does Venmo matter in a discovery context? The Office of the Attorney General does not ask for Venmo records in their discovery requests in child support cases.  Older attorneys do not know Venmo exists, and those who are aware of its existence rarely send requests for production of Venmo records in discovery.  A party can say they receive little to no wages, produce bank accounts and inventories showing very low balances, and be ordered to pay minimum wage guideline child support, when in reality they earn many times minimum wage.  In the divorce context, a party can hide large sums of cash from their spouse in Venmo, distorting property divisions.  They can sell certain assets or goods, require payment through Venmo, then claim they gave it away as a gift or don’t know what happened to the asset, without having to ever disclose the actual value received for the goods.

Venmo is neither a bank account, nor is it a social media account, but lies somewhere in between, as a smartphone app that vaguely resembles an escrow account or clearing house.  Unless attorneys are proactive in regards to new technological developments like Venmo, including requesting screenshots of a party’s Venmo “feed,” “transfers,” and “activity,” the problem will remain.

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Photo of Michelle O'Neil Michelle O'Neil

Michelle May O’Neil has 27 years’ experience representing small business owners, professionals, and individuals in litigation related to family law matters such as divorce, child custody, and complex property division. Described by one lawyer as “a lethal combination of sweet-and-salty”, Ms. O’Neil exudes…

Michelle May O’Neil has 27 years’ experience representing small business owners, professionals, and individuals in litigation related to family law matters such as divorce, child custody, and complex property division. Described by one lawyer as “a lethal combination of sweet-and-salty”, Ms. O’Neil exudes genuine compassion for her client’s difficulties, yet she can be relentless when in pursuit of a client’s goals. One judge said of Ms. O’Neil, “She cannot be out-gunned, out-briefed, or out-lawyered!”

Family Law Specialist

Ms. O’Neil became a board-certified family law specialist by the Texas Board of Legal Specialization in 1997 and has maintained her certification since that time. While representing clients in litigation before the trial court is an important part of her practice, Ms. O’Neil also handles appellate matters in the trial court, courts of appeals and Texas Supreme Court. Lawyers frequently consult with Ms. O’Neil on their litigation cases about specialized legal issues requiring particularized attention both at the trial court and appellate levels. This gives her a unique perspective and depth of perception that benefits both her litigation and appellate clients.

Top Lawyers in Texas and America

Ms. O’Neil has been named to the list of Texas SuperLawyers for many years, 2011-2018, a peer-voted honor given to only about 5% of the lawyers in the state of Texas. In 2014-2018, Ms. O’Neil received the special honor of being named by Texas SuperLawyers as one of the Top 50 Women Lawyers in Texas, Top 100 Lawyers in Texas, and Top 100 Lawyers in DFW. She was named one of the Best Lawyers in America for 2016 and received an “A-V” peer review rating by Martindale-Hubbell Legal Directories for the highest quality legal ability and ethical standards.

Author and Speaker

A noted author, Ms. O’Neil released her second book Basics of Texas Divorce Law in November 2010, with a second edition released in 2013, and a third edition expected in 2015.  Her first book, All About Texas Law and Kids, was published in September 2009 by Texas Lawyer Press. In 2012, Ms. O’Neil co-authored the booklets What You Need To Know About Common Law Marriage In Texas and Social Study Evaluations.  The State Bar of Texas and other providers of continuing education for attorneys frequently enlist Ms. O’Neil to provide instruction to attorneys on topics of her expertise in the family law arena.