May 19, 2022

When splitting assets and determining settlements in a divorce, things can get contentious. Even couples who are attempting a healthy divorce can find that dividing assets is frustrating, especially when the incomes and assets are uneven. During the process, each spouse must openly and honestly disclose all assets, income, and debts, but this doesn’t always go smoothly. Some spouses may try to avoid sharing their assets by hiding them during a divorce. This is always a bad idea and is, in fact, illegal.

What Kind of Assets do Spouses Try to Hide?

Many spouses who hide assets are hoping to keep this property for themselves instead of allowing all assets to be part of a fair settlement. Some spouses will try to move their assets around to avoid having them discovered, while others will knowingly omit, understate, or undervalue their income or assets. For example, one spouse may try to hide a retirement or investment account, move money into a new account under a different name, or disclose only a base salary without commissions or bonuses that are considered part of the compensation. Many spouses, especially those in contentious divorces, justify this by arguing that their ex-spouse doesn’t deserve what they worked for and earned on their own.

What are the Consequences of Hiding Assets?

Lying during divorce proceedings is illegal. When you sign a court document, you are agreeing that the document is true and correct. That means you are swearing, under penalty of perjury, that you are telling the truth about your finances and disclosing all your assets, debts, income, and expenses. This is true even if you weren’t specifically asked about every single potential asset. For example, if no one asked, “do you have stock options?”, you are still required to disclose that you do. If you lie under oath you face very serious consequences. You may be ordered to pay your spouse’s attorney fees, you may be required to pay a fine, your claims may be dismissed, or you can even face incarceration. Though rare, a spouse caught concealing assets could be ordered to pay other spouse THREE TIMES the amount they were caught hiding.  If you are caught hiding $100,000, you may have to pay your ex $300,000!  Lying during a legal process is simply not worth the risk.

What Should You Do if You Think Your Spouse is Hiding Assets?

If you think your spouse may be trying to hide assets, you need a qualified attorney. Likely, your attorney will also recommend a financial expert who can fully investigate your spouse’s claims. Your attorney may have you prepare a lifestyle analysis, which will look at your spending habits and day-to-day living expenses to help verify your net worth and income statements. During discovery, your attorney will ask the right questions to ensure that your spouse is either forced to share all their assets or risk perjuring themselves. Trust your attorney to find the right information. The court can order your spouse to provide accurate information, and if they don’t comply, they will be held in contempt, which could mean jail time.

Hiding money, assets, and anything else during a divorce is always a terrible idea and can get you in serious legal trouble. While divorce is difficult, trust in your attorney to protect your interests and your assets and act as your advocate to get the best outcome so you and your family can move on and begin building your life again. If you’re going through a divorce and need an experienced, trusted voice on your side, contact my office today.