Hidden assets are a problem in many divorce cases. While most people realize that hiding assets during a divorce is both unethical and illegal, many do so anyway, often in a belief that the hidden assets rightfully belong to them alone and not to their former spouse. Below is a look at why hiding assets, even when one thinks such assets "rightfully" belong to them, is wrong and what people can do when they suspect that a former spouse is concealing their true net worth during divorce negotiations.
Why hiding assets is wrong
Marriage is as much a financial union as it is a legal or romantic one. Many of the assets are considered to be shared by both parties, such as bank accounts, real estate, vehicles, and so on. While there are assets that are usually excluded from property division in divorce, such as gifts and inheritances, most are not and will need to be divided, either through a negotiated settlement that both parties agree to or through a division of property ordered by a court.
Some people going through a divorce, however, may wrongly assume that they are entitled to more of the marital estate than is indeed the case. In cases where just one spouse was earning an income, that spouse may think a greater share of the marital estate belongs to him or her. However, the courts will largely disagree, since the other spouse will have contributed to the marriage in other ways, such as by raising the children or cleaning the home. As Forbes reports, hidden assets tend to be especially common in divorces where there is more money up for division.
Where assets are typically hidden
There are a number of places where assets typically get hidden during a divorce. Offshore bank accounts are, of course, a long-time favorite. For divorcing spouses who are also small business owners, it is not uncommon to hide assets and one's net worth by declaring personal expenses as business expenses, taking on cash jobs, or underreporting income.
A new, but potentially highly lucrative, way of hiding assets is through cryptocurrencies. Recent headlines about Bitcoin's skyrocketing price has made this asset an attractive one for deceptive ex-spouses looking to hide their assets from a former spouse since Bitcoins are largely anonymous and difficult to track.
Family law help
Uncovering hidden assets is not easy and it will usually require the assistance of a forensic accountant. An experienced family law attorney can advise clients who are worried that an ex-spouse is hiding assets about who to contact for help and how to protect their best interests. More importantly, an a ttorney can help clients effectively negotiate a divorce settlement that will protect them both today and into the future.