Getting a Handle on Hidden Assets in a Divorce

Posted by on Dec 22, 2018 in Familiy Law | 0 comments

There’s a nightmare scenario that sometimes really does come up in divorces: the relationship between the two former partners has become so ugly, one partner takes it upon themselves to punish the other by hiding assets. How can this happen? Why does this happen? What can you do to stop it? It’s a complicated topic, but it’s important to address it if for no other reason than to relieve you of any future fears. Thankfully, a recent blog post from Adams Law Firm has covered this exact topic.

To begin with, we need to understand why a former spouse would hide assets, other than just spite. The Adams Law Firm points to several motives:

  • An attempt to lower net worth to gain a larger share of marital assets and a lower share of marital debt
  • An attempt to deny their former spouse a large enough stake in their interests to threaten control
  • A desire to keep assets that are difficult to replace
  • An attempt to lower the amount of alimony or child support owed
  • An attempt to hide financial proof of infidelity

These are the most likely reasons, but of course, there may be others. In the end, the reason isn’t what is important. The most important thing is to rediscover those assets to make sure you aren’t cheated in your divorce.

Discovery will likely require significant effort, unfortunately, unless your former spouse happens to be very sloppy. You will likely have to take legal action that allows for the legal discovery process, in which your lawyer can demand financial documents that can then be sent out to experts to look for the hidden assets. These experts are called forensic accountants. They can look through financial records to find the inconsistencies that prove assets are being hidden.

In the divorce process, you don’t have to provide conclusive evidence of hidden assets. Instead, you just need to provide enough evidence that the judge tends to doubt your spouse’s honesty. They can then take steps to financially penalize your spouse in the final divorce agreement.

The biggest difficulty in this process is detecting the hiding in the first place. If you are not in charge of your family accounts, it will be harder to catch your spouse moving property or money into a hiding place to protect them against their legal obligations.

The lesson from this, then, is to keep a sharp eye on finances and your spouse’s behavior in the time leading up to your divorce. If you have any suspicion that your spouse has been cheating you out of assets, make sure you find a lawyer that is willing to put in the extra effort to track down these hidden assets to make sure you aren’t the one left paying.

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