While weddings can bring out the best in people, divorce can do the opposite. With financial issues noted as one of the leading causes of divorce, it’s no surprise that a spouse may attempt to conceal assets.
Whether or not you’re facing a high-stakes divorce, many spouses attempt to keep funds shielded from the property division process. This is not only unethical; it’s also illegal.
This article will outline how a spouse may try to hide assets, how hidden assets can be found, and the consequences of hiding assets.
Penalties For Hiding Assets
Significant penalties can be incurred as a result of attempting to hide assets. In fact, it is illegal to hide, understate, or overstate assets, marital property, debt, income, or expense.
Anyone found to knowingly violate asset disclosure laws can face financial penalties. In addition to potentially being fined by the court, the violating spouse may be forced to pay for their ex-spouse’s attorney fees and fines.
In some cases, the court has the ability to force the violating spouse to forfeit their share of a different asset as restitution to the wronged spouse. Hiding assets can even result in jail time.
Common Tactics To Hiding Assets
There are a number of ways assets can be hidden. For example, if you and your spouse own a business, the business can be used to hide assets to make it seem like they have less money than they do.
Additionally, a spouse can ask their employer to delay a promotion or raise until after the divorce or delay receiving a large commission from work.
Another way spouses may attempt to hide assets is by ‘gifting’ money to a trusted friend, relative, or new significant other until after the divorce is finalized.
Finally, spouses can overpay on their taxes so that the money will be returned to them the following year.
Uncovering Hidden Assets
You should know that you have the right to request copies of your spouse’s financial documents. In cases where someone is suspected of hiding assets, a forensic accountant can be hired to help investigate.
During your divorce, you will go through a discovery process. Both parties are required to answer specific questions and turn over documents during this process. Standard documents both you and your spouse may be asked to provide include account statements, tax and loan reports, and any additional paperwork related to assets.
Navigating a divorce can be a trying process, whether or not you suspect your spouse is hiding assets. Working with an attorney who is knowledgeable on Massachusetts divorce law can help guide you through the process. Contact our office for a consultation today.