Divorce is a hard decision for any couple to make, and no step in a divorce is easy. During divorce, spouses provide information about financial assets and property for the division of assets. Unfortunately, some spouses, particularly those in high-asset divorces, will try to hide some of their assets to avoid providing the other party their fair share or to receive more themself. This is also more common if a business owned by one or both spouses is involved.
How a Spouse May Attempt to Hide Assets
There are a number of ways a spouse may hide assets or income. If there was a period of time between deciding to get a divorce and the actual proceedings, this gives dishonest spouses the time they need to hide their assets. This may include:
- Transferring marital assets to third parties, such as a family member, friend, affair, or straw purchaser. This may be in the form of gifts, debt repayments, or money that can be returned to the spouse after the divorce is finalized.
- Fake personal loans that suddenly need to be paid as divorce proceedings begin
- Creating and placing assets in a retirement account that the other spouse was unaware of
- Failing to disclose cash payments or cash payments that can be traced to marital bank account withdrawals
- Undervaluing assets like artwork, furniture, vehicles, or antiques
- Undervaluing a business
- Waiting to make important business deals until after the divorce is finalized if the spouse owns a business
- Delaying income or bonuses until after the divorce is finalized
- Setting up a trust that they do not disclose to the other spouse
- Accounts created in their child’s name
- Undisclosed tax returns or income or other essential information that is stored elsewhere
These are only some ways that a spouse may hide their true assets and income during divorce proceedings. If your spouse is being secretive about financial assets or payments and you have no way to verify financial statements, it may be useful to talk with a divorce attorney who understands how to look for hidden assets.
How to Find Hidden Assets
During the process of divorce, you want to ensure you receive your fair and reasonable portion of marital assets. If your spouse hides assets, you will likely not receive the portion of these assets that you should. However, there are steps you can take to find assets a spouse may be hiding.
- Analyze financial documents. If you have legal access to financial information or access to places there may be hidden assets, look for evidence of hidden assets. Be aware that any illegal activity is inadmissible in court. Legally looking for assets and financial information can be one way to discover whether or not your spouse is hiding assets.
- Utilize the process of discovery in divorce. If you can’t access this financial information, use the discovery process. This is the legal way during divorce that attorneys can request financial information and provide information through interrogatories. The discovery process can also include subpoenas and depositions.
- Work with an attorney. An attorney will know the ideal legal steps to take to investigate your spouse’s assets and gain information from them. A lawyer has many tools and resources available to find hidden assets.
It’s illegal for a spouse to hide assets, and a spouse who is discovered hiding assets will face penalties. It may also be considered misconduct when determining fair and reasonable asset distribution, impacting the portion of assets each spouse receives.
Hidden Asset Attorney Techniques
Attorneys can provide more intensive investigations into your spouse. They are also experienced in hidden asset cases, meaning they will know what to look for. This includes financial discrepancies, misrepresented account information, or non-disclosure of important assets and income. Attorneys can utilize techniques such as:
- Investigating financial transitions and information
- Providing banks with court-ordered injunctions
- Issuing banks automatic restraining orders, which prevent assets from being taken from the account
- Bringing in third parties in divorce court or another court claim who are hiding or holding onto marital assets
If you’re worried your spouse is trying to impact the equitable distribution of property with hidden assets, it’s important to protect your interests and your financial future.
FAQs
Q: Are Hidden Assets Discoverable in Divorce?
A: Yes, hidden assets can be discovered by a spouse, by attorneys, by forensic accountants, or by the divorce court discovery process. Even when one spouse has control over financial assets and information, the other spouse has the right to request financial documents. If a spouse is uncooperative, the discovery process and a divorce attorney can request and require asset information.
Q: How Do You Prove Hidden Assets?
A: Certain financial documents may provide evidence to prove that a spouse is hiding assets. These documents may include:
- The past two years of bank statements
- Tax returns for both spouses in the last three years
- Bank and retirement account statements
- Bills and receipts
An attorney can also help you gather further information if your spouse doesn’t honor your request to view financial information.
Q: What Is a Spouse Entitled to in a Divorce in Kansas?
A: Both spouses are entitled to an equitable, but not equal, share of marital property. If spouses cannot come to a fair agreement in mediation and negotiation, the court will look at several factors and determine what is a fair and reasonable split of assets. Marital property is all assets gained during the course of the marriage unless different provisions are made in a prenuptial or postnuptial agreement. Certain assets gained during a marriage, such as gifts or inheritance given to one spouse, are considered separate property and therefore are not up for property division.
Q: Can I Empty My Bank Account Before Divorce?
A: In most cases, no, you shouldn’t empty a bank account before divorce. It would likely be looked on unfavorably by the judge. You can only empty a bank account if it is explicitly stated that you can do so in a prenuptial or post nuptial agreement, or if the bank account is classified as separate and not marital property.
Working with Stange Law Firm to Uncover Hidden Assets
If you believe your spouse is hiding assets before and during divorce proceedings, you need to know what your rights are and the legal options available to you. Contact Stange Law Firm for legal counsel and representation in your Wichita divorce.
