Can Your Spouse Hide Assets from a Divorce?
Divorce is a complicated and frustrating process. Yet a divorce can quickly get a lot messier when one spouse tries to hide assets from the divorce. You aren’t allowed to do this, legally speaking. Despite this fact, people still try to get away with it all the time.
So why can it be okay to hide assets in a relationship but not a divorce? Divorce is a legal process. Hiding assets in a divorce means lying while you are under oath or in your paperwork, which itself is illegal. In addition, if your credibility is put in question because you were caught hiding an asset, this could affect every aspect of your divorce, even custody!
Divorce involves what is called the discovery phase. This is where each party gathers relevant information from third parties like banks and employers. This involves live testimony about your assets and liabilities. Lying here means committing perjury. If you are found to have lied about your assets in a divorce, then you could face both a charge of perjury and monetary fines. But these prosecutions are rare. The bigger issue in most cases is that lying about financial matters can cause the judge to rule against you on all contested factual issues.
What Are Some Signs That Your Spouse May Be Hiding Assets?
Unfortunately, it can be quite difficult to discover hidden assets if you don’t know what to look for. After all, the point of hiding them was to keep them from being found. It is much harder to hide assets if you share equal responsibility for bookkeeping during the marriage. When a couple shares in the bookkeeping, the chances of hidden assets don’t go away, but it does greatly diminish.
If your spouse did the bookkeeping on their own, they would have a much easier time hiding assets. The first thing you are going to want to do is to ask your spouse for a copy of all the relevant financial documents. Things could actually move right along without much issue if your spouse is forthcoming with these. But you’ll find it more likely that they can’t find them all or run into countless issues in giving you the documents.
Working with an attorney is one of the best ways to identify hidden assets. An experienced divorce attorney will be able to ask relevant questions and spot suspicious figures that might be evidence of hidden assets.
If you aren’t sure whether or not your spouse is hiding assets, there are some signs that suggest more is going on than meets the eye. Signs of hiding assets could be:
- Your spouse begins giving extravagant and out-of-character gifts to their friends or family.
- Your spouse has a private mailbox that you are not allowed to open.
- Your spouse has gone on an uncharacteristic shopping spree and spent a lot of funds.
- Your spouse suddenly has a lot of business expenses that they have to cover out of pocket.
- Your spouse refuses to share the passwords for any of your financial accounts.
Going on a wild shopping spree might not sound like hiding assets. After all, you know about the shopping spree, so what could be hidden? If this was a normal shopping spree, then there would be no problem. But with divorce on the horizon, they could be engaging in the dissipation of assets.
What Is the Dissipation of Assets?
The dissipation of assets is the act of purposefully spending marital assets with the intention of depriving your spouse. There is also what is called dissipation through waste, which is the act of purposefully reducing or destroying the value of marital assets with the intention of depriving your spouse.
It is important to stress the deprivation aspect, as well as the intention behind the act. If your spouse simply goes out and spends more money than they intended on something, they did not partake in the dissipation of assets. There was no intention to deprive their spouse in the action, though the money is still spent either way.
Let’s take that same scenario and change a key detail. Let’s say that your spouse had a feeling that you were going to be filing for divorce or they were planning to do so themselves. Now the choice to spend so much money is a little bit suspicious and could point towards an attempt to hide assets through dissipation.
With a divorce, your assets at the time of the divorce are generally divided equally unless such a division would be inequitable. Therefore, spending those assets removes them from what is being divided. But if you can prove that the dissipation of assets occurred, then steps can be taken. A judge could issue an injunction to prevent your spouse from disposing of assets in this manner. It’s essential to act quickly if you want to stop further loss.
How Do You Find Hidden Assets?
Finding hidden assets is not easy to do. The best way to go about it is with the help of a professional divorce attorney. Not only do they know what to look for, but they also will have contacts and other professionals they can rely on for assistance.
It is much easier to find hidden assets with a team than it is to do so by yourself.
When Should I Contact a Lawyer?
If you believe your ex is trying to hide assets, you should speak to an attorney immediately. It is always better to act quickly to prevent further loss of assets. An attorney can help you find hidden assets, prove your spouse’s intention to deprive you, and help you get the most out of your divorce.