In some divorce cases, a spouse may try to conceal assets to keep them for personal use or to reduce their spousal or child support obligations. However, watching for red flags can tell you when you should start looking for marital assets your soon-to-be-ex may be hiding.
If you don’t know how to find hidden assets in your divorce proceedings, an experienced attorney can conduct a thorough investigation. They may also enlist forensic accountants and private investigators to help them uncover critical evidence.
What Are Hidden Assets in Divorce?
When couples get divorced, a spouse may attempt to conceal assets or income to gain an unfair advantage or because they believe that they deserve a larger portion of the marital property. Spouses may try to conceal financial assets to avoid having to split them in the divorce. They may also hide income to lower their child or spousal support obligation or have a more favorable position during property division in divorce.
Examples of assets that spouses may try to hide in divorce include:
- Business income
- Real estate
- Stocks and other investments
- Cryptocurrencies
- Collectibles or artwork
Some of the most common methods spouses may use to hide assets for divorce include:
- Offshore trusts
- Separate bank accounts
- Fraudulent transfers (transferring assets to parties who promise to transfer the asset back after the divorce)
- Fake business loans
- Putting money into cryptocurrency
- Purchasing collectibles or other high-value assets
- Delaying pay raises or bonuses
- Inflating expenses or debts
Warning Signs Your Spouse May Be Hiding Assets
When a spouse begins to hide assets while contemplating a divorce, they may show various warning signs. Common red flags of concealed assets in a couple headed for divorce include:
- Unexplained transactions or large transfers of money from joint bank accounts
- Monthly financial statements in the mail for new, unexplained accounts
- A spouse reducing their contributions to the family bank accounts
- Splurges in spending, including purchasing luxury assets like cars, watercraft, or high-end jewelry
- Transfer of assets like real estate to family members or friends
- Changes to financial account passwords or passcodes
- One spouse removing the other from joint accounts or as beneficiary of life insurance, retirement, or pension accounts
- Missing or deleted financial records, including monthly statements, deeds, or titles
- No changes in a spouse’s spending habits despite a claimed pay cut, loss of bonuses, or commissions
- Sudden debts or liens encumbering real estate or businesses
- Changes in a spouse’s attitude toward sharing financial information
- Evasiveness or stonewalling from a spouse when bringing up financial discussions
- Shifting money into cryptocurrency holdings
- Delayed invoicing or inflated expenses in a family business
When you notice any of these signs, you should consult a divorce attorney as soon as possible to discuss your legal options. An experienced attorney can provide you with ways you can protect yourself if your spouse has chosen to hide assets.
How Divorce Attorneys Uncover Hidden Assets
During divorce proceedings, attorneys may learn of evidence suggesting that their client’s spouse has concealed assets. Fortunately, divorce attorneys have various tools at their disposal to discover those hidden assets.
A divorce attorney can utilize discovery tools such as interrogatories, requests for documents, and depositions to obtain evidence that may help identify concealed assets. They may also enlist forensic accountants to track down funds through financial records or private investigators for surveillance on spouses suspected of hiding assets to uncover evidence.
For example, documents turned over by a spouse may have inconsistencies that they can’t explain in a deposition. Those documents can serve as a starting point for investigation by experts retained by a divorce attorney.
Legal Consequences of Hiding Assets in Divorce
A spouse who gets away with hiding assets may receive an unfair distribution of the marital estate. They may retain assets that the spouses should have split or have a lower alimony or child support obligation due to their reduced apparent income. However, when a spouse gets caught concealing assets, they may face various consequences from the court presiding over the divorce case, such as:
- A less favorable property division that benefits their ex-spouse
- Orders to compensate their spouse for legal and professional expenses incurred to uncover the hidden assets
- Civil contempt orders, which may include penalties such as fines
- Criminal perjury charges if efforts to hide assets included false statements made under oath
Concealed assets during negotiation of a prenuptial, postnuptial, or divorce settlement agreement may also lead a court to vacate the agreement. When couples negotiate these agreements, the law requires full financial disclosures from both spouses. Hidden assets may provide the spouse who did not conceal assets with a basis to invalidate an agreement. They can then pursue litigation regarding property division and spousal support for a fairer arrangement.
Steps to Take If You Suspect Hidden Assets
When you suspect that your spouse may have hidden assets in contemplation of your divorce, steps you can take to protect your financial interests include:
- Gather relevant financial documentation, including bank statements, pay stubs, tax returns, deeds, and titles.
- Monitor joint accounts for unusual or unexplained activity, such as large withdrawals or transfers to unfamiliar accounts.
- Watch for changes in your spouse’s spending habits, such as major, unexpected purchases.
- Notify your divorce attorney whenever you have suspicions that your spouse may have moved assets or hidden income. Your attorney can work with forensic accountants and other experts to track down concealed property.
Protecting Your Interests in Huntsville, AL
If you suspect that your spouse is trying to conceal assets or income in your divorce, the team at Leigh Daniel Family Law can help. Our firm has over 30 years of experience advocating on behalf of clients in complex divorce cases involving asset discovery efforts. Our dedication to helping individuals protect their financial interests has earned us the respect of the clients we’ve represented in divorces involving hidden assets, such as this satisfied client:
“Leigh was very straightforward and let me know exactly what to expect. I appreciated her honesty, which prepared me for the outcome. I felt she was invaluable in representing my interest.” – Tammy Elders
Contact us today for a confidential consultation with a hidden money divorce attorney to learn more about your legal options.
