Divorce proceedings tend to be somewhat combative. Even people who want to divorce with dignity may let their emotions overwhelm them. Some spouses engage in forms of misconduct that they might never consider under normal circumstances.
The intense psychological reactions people have to divorce can spur them to behave in unethical and unusual ways. If the marital estate is large or complex, there may be reason to worry about financial misconduct during the divorce process. One spouse may fear the possibility of the other hiding assets. They might physically move property from the marital home, divert funds from a shared financial account or undervalue what their property is worth.
How can people who suspect a spouse of hiding assets protect themselves during divorce?
With a thorough financial review
Going over household financial records is often the only way to affirm if one spouse has hidden assets. In some cases, attempts to hide income or resources are relatively blatant. Other times, it may be necessary to retain the support of a professional, such as a forensic accountant, to effectively assess the marital estate and determine if there are any hidden assets.
Forensic accountants can find discrepancies in financial records. They can trace income and assets. Their expertise may prove invaluable to those who believe their spouses have hidden property.
With evidence presented in court
Once people have validated their fears of hidden marital assets, they need to effectively document what they uncover. They can then present that information to the courts during property division litigation.
Given the risk of continued financial misconduct, settling property division after uncovering hidden assets can be risky. Agreeing to specific terms puts the spouse who uncovered the hidden assets at a disadvantage, as they may not be able to demand justice if additional misconduct comes to light later.
The obligation to make formal disclosures to the courts during a litigated divorce helps reinforce the protections of the spouse who discovered hidden assets. The courts can account for the value of hidden property when entering a final asset division decree. Penalizing people for lying to the courts is common.
Identifying and documenting attempts to hide assets can protect people during a very vulnerable time. Spouses who validate their claims of hidden assets can push for fair property division outcomes.
