When dividing assets in a divorce, transparency can help you reach an equitable resolution.
Unfortunately, some individuals resort to unethical practices, attempting to conceal property and wealth during divorce proceedings. Hidden assets can throw a wrench into the fair division of property, leaving the other party disadvantaged.
Unexpected transactions
Unusual financial activity that differs from pre-divorce spending habits may indicate hidden assets. If your spouse starts moving money around or making large withdrawals without a clear reason, it could be a sign that something is amiss.
You should be cautious if you notice your spouse transferring assets to third parties, especially close associates, as this could be a way to hide wealth until after the divorce. Likewise, sudden changes in your spouse’s business can be a tactic to hide assets. Your spouse might try selling assets at below-market prices or transferring ownership to a friend or family member.
Withheld records
Bank statements, financial records and tax returns often play a major role in asset division. If your spouse is reluctant to provide documentation during divorce proceedings, that should raise your suspicions.
If you discover unexpected bank accounts or offshore holdings belonging to your spouse, it can be a clear indicator that they are attempting to keep assets out of the divorce settlement. These days, with over 20 million Americans owning cryptocurrency, your spouse might use digital currencies to conceal assets as well.
Concealing income is another common asset-hiding strategy. You may have cause for concern if your spouse suddenly reports lower earnings or tries to downplay their income.
Inflated debts
In some cases, spouses may exaggerate their debts to offset their assets, making their financial picture appear less favorable than it actually is. If your spouse claims to have incurred significant debts you were unaware of, it might be a cover-up for hidden assets. They could be funneling money into these undisclosed debts to make it appear like they have fewer assets.
Awareness of common asset-hiding practices and their signs can help you protect your financial interests during your divorce.