Is My Former Spouse Hiding Assets During Our Divorce?

During the divorce process, both spouses are required to make a full financial disclosure so that a fair split of marital assets can occur. When one spouse hides assets or otherwise attempts to prevent some assets from being distributed to their soon-to-be former spouse, it can make the process more difficult. Nonetheless, there are ways to discover whether or not your spouse is hiding assets. In this article, the Philadelphia divorce attorneys at the Law Offices of Lauren H. Kane will discuss what to do if you suspect your spouse is hiding assets from the court.

Why is making full financial disclosure so important? 

For one thing, the process of attesting to your finances is done under oath. So you can be charged with perjury if it’s determined that you intentionally hid assets from the court. Full financial disclosure ensures that each party has a clear understanding of both the assets and debts that were accrued during the marriage. This facilitates an equitable distribution of property. In the absence of complete transparency, one spouse might attempt to conceal assets or misrepresent important financial information to deprive the other spouse of their share of the marital estate. This would then lead to an unjust settlement. Financial transparency helps ensure that the court accurately assesses matters such as alimony and child support.

During a Pennsylvania divorce, both parties are legally obliged to provide full financial disclosure to the court and each other. This requires an exhaustive list of assets, debts, income, and expenses. The court will require bank statements, tax returns, retirement accounts, investment accounts, and any other documents that describe the spouse’s financial situation. Failure to comply with these requirements can result in serious consequences, such as sanctions issued by the court or even charges of fraud.

How does one spouse go about hiding assets? 

• Transferring assets – One of the most common tactics for hiding assets during divorce proceedings is transferring them to a friend or a family member. For example, the spouse might “gift” valuable items to a relative or even create faux transactions that appear to show assets being sold, but are not actually transferred to another party.

• Underreporting income – This tactic is used to conceal income during divorce proceedings. It involves intentionally reporting less income than one party actually earns. This could include failing to disclose transactions using cash and underreporting the revenue of a business. This tactic reduces the amount of money subject to equitable distribution or alimony calculations.

• Creating fake debt – One spouse might fabricate loans, inflate existing debts, or create sham transactions. This creates the illusion of financial liabilities and reduces the amount of money available for equitable distribution or spousal support. For example, a spouse could claim to owe money to a relative. They would present falsified documents to support the illusion that there is a real loan. In other cases, the spouse could fabricate business expenses to make it seem like they have more debt than they actually have.

Talk to a Philadelphia, PA Divorce Lawyer Today 

The Law Offices of Lauren H. Kane represent the interests of those pursuing a divorce in Philadelphia County. Call our Philadelphia family lawyers today to schedule an appointment, and we can begin discussing your next steps right away,