During divorce, spouses may resort to less than savory means to either “get back” at their spouse or protect their position either financially or with the children. For spouses with high-net worths, hiding assets is a common way spouses try to protect their interests during divorce, but it’s important to understand that while it may be tempting to hide assets from the court, doing so could hurt both spouses and the family in the end.
So, how do people conceal assets during divorce, and what should you do if you believe your spouse may be hiding assets? Keep reading to find out.
Understanding High-Net Worth Divorce
Divorce is complicated regardless of how amicable spouses may be. For those cases involving high-net worths, finances can be extremely complicated to untangle. High asset divorce may include hurdles that other divorces may not.
For example, due to the nature of high value assets, appraisers may be necessary to calculate for property division. Forensic accountants may also be necessary to find and value bank accounts and investments that could be kept overseas.
Other unique challenges/assets may include:
- Foreign bank accounts
- International real estate
- Stocks and bonds
- Pre-nuptial agreements
Equitable distribution can become contentious in a normal divorce case, but when the assets are extremely valuable, fine print means everything and often makes matters more complicated.
What Are Hidden Assets?
Spouses are required to report all assets during a divorce to ensure that property is distributed equitably. It’s important to note that assets are divided equitably not equally. This means that there is not a 50/50 split but rather a fair division that is intended to ensure that both parties maintain a standard of living comparable to when they were married.
Assets that are concealed from the court and the other party are considered hidden. If an asset is hidden, the court may investigate the whereabouts and may take further action if the assets were hidden from a criminal court as well.
Common Ways Spouses Hide Assets
A spouse may hide assets for a number of reasons, and the most common methods for doing so may include the following:
- Buying new, expensive items
- Hiding cash
- Paying off a personal loan
- Delaying promotions or bonuses
- Not reporting cash income or gifts
- Delaying invoicing salary earnings
- Custodial accounts in a child’s name
Any of these methods may be employed to conceal finances during divorce. If an individual notices attempts to hide assets using any of the methods listed above, they should contact an attorney.
How To Stop Prevent Hidden Assets
Finding hidden assets can be a challenge and may involve a forensic accountant in some extreme cases. The discovery phase of divorce proceedings is intended foster information sharing between parties so they can share important documents and information.
Its during the discovery phase that spouses may request specific documents related to hidden assets and the court may help to put pressure on the other party to present the requested information. If a party refuses to submit documentation of assets, or fails to acknowledge the existence of an asset then a forensic accountant may be necessary.
Trustworthy Legal Guidance
Nichols Dixon PLLC believes in providing premier legal counsel for clients going through some of the most difficult times of their lives. Our compassionate family attorneys put their decades of experience toward each case so our clients can achieve the most optimal result.
Contact Nichols Dixon PLLC today for more information.