When it comes to divorce, especially a high-asset separation, there is a lot at stake. One spouse may hide valuable assets to prevent them from being subject to property division or accounted for alimony or child support.
However, this type of behavior is illegal. Lying about your finances and lying under oath can result in severe penalties, which includes time spent behind bars. In most cases, the judges also award all hidden assets to the other spouse.
The following are the most common signs to look out for during a divorce to protect yourself from fraud:
- Keeps financial affairs a secret – While it is not uncommon for couples to avoid communicating with one another, if you suspect your spouse is being secretive about finances to hide assets or take advantage of your ignorance, ask for information. If your spouse fails to answer or gives you the runaround, ask your divorce lawyer for help.
- Maintains complete control of access to finances – If your spouse is the only one who knows your joint bank account information and passwords, it is possible he/she may be hiding assets. Perhaps your spouse removed your name from joint accounts. You have the legal right to have access to joint accounts throughout the divorce.
- Unusual spending discrepancies – If there is evidence that your spouse is living a lavish lifestyle (i.e. purchasing expensive clothes, going on luxurious trips, eating at high-end restaurants, etc.) but claims to have limited finances, it is highly likely that your spouse is lying about his/her finances.
- Underreports income – If your spouse runs his/her own business or gets paid in cash, he/she can easily underreport what they actually earn. If he/she is not self-employed, your spouse can still attempt to deflate his/her income by asking his/her employer to delay receiving a bonus until after divorce or decrease tax exemptions from his/her paychecks.
- Gives large gifts to friends and family – Gifting to family members or friends during divorce another way your spouse could hide assets from you. These parties can hold on to these assets until the divorce is finalized, so your spouse can reclaim them as his/her own.
- Uses a separate account – If portions of your spouse’s income are being deposited into a separate account, he/she may be trying to keep it for himself/herself. You can inspect his/her paystub to see where the money is going or bank statements to observe if any deposit amounts have been altered. Your spouse could also open a custodial account on behalf of one of your kids, but to divert money into that account without your knowledge.
- Owns a private mailbox – Your spouse may be using a P.O. box to receive bank statements in secret, as opposed to having them sent to your home.
It is imperative to remain vigilant with your financial information throughout your divorce. Never assume that your spouse is being truthful about his/her finances. If you suspect your spouse is hiding assets, an experienced lawyer can provide knowledgeable advice and guide you through the legal process.
For more information about divorce, contact our Henderson divorce lawyer at Ford & Friedman today.