According to a January 2014 poll by the National Endowment for Financial Education, one-third of people lie to their spouses or partners about money or other financial matters. During divorce, asset concealment can dramatically and unfairly influence the outcome of a property settlement, child support determination or award of spousal support. Thus, it is wise for all divorcing individuals to be aware of the risk and watch for warning signs that a soon-to-be-ex is being dishonest about money.
Why do people hide assets during divorce?
Despite being illegal in Florida, the concealment of money and other assets during divorce is a relatively common occurrence, and people do it for a variety of reasons. Often, the desire to hide assets from a divorcing spouse may be based in feelings of greed, selfishness or revenge. In some cases, people who hide assets may rationalize their behavior through the misguided belief that they deserve more than their fair share for one reason or another. Other times, people engage in asset concealment in an attempt to minimize taxes, child support payments, alimony awards or to influence the outcome of a property division settlement.
How do spouses hide assets from one another?
People hide money and other assets from one another in all sorts of ways, both during marriage and in anticipation of divorce. Some methods of asset concealment are decidedly old-fashioned, such as keeping cash, jewelry or other valuables in a safe deposit box or other hidden location. Others use more sophisticated methods, such as investing in art, antiques or other property whose value is easily underestimated, fabricating or overpaying debts, or deferring income or bonuses until after the divorce.
When divorcing a business owner or self-employed individual, it is wise to be particularly wary of the potential for asset concealment – a small business can be a convenient and relatively easy place for dishonest spouses to hide assets. For example, the owner of a small business may attempt to obscure its true value during divorce by inflating payroll or overhead costs, exaggerating losses or taking on new employees without a genuine business need.
How can I tell if my spouse is hiding money?
While there is no single red flag that can establish with certainty that a spouse is attempting to hide assets, there are some common warning signs that it is wise to watch out for during divorce. For instance, if your spouse’s lifestyle and expenditures seem out of proportion to his or her claimed income, it could be because he or she is hiding assets from you. This is especially if he or she has complained of sudden financial difficulties that do not correspond to a noticeable decrease in spending.
Other potential red flags include sudden changes in the ways that the spouse talks about money or financial matters, particularly if he or she appears reluctant to discuss financial topics or share account information, passwords or statements with you. Similarly, if a spouse opens multiple bank accounts without a clear reason for doing so, or if he or she has financial documents delivered to an address outside the home, it may indicate that he or she is hiding something. In many cases, a spouse who is attempting to conceal assets will also be strongly opposed to the idea of involving lawyers in the divorce, since this can greatly increase the chances that the asset concealment will be discovered.
If you suspect that your spouse is hiding assets from you, a good first step is to talk things over with a divorce lawyer. He or she can help you evaluate your legal options and, should you so choose, will work hard on your behalf to uncover any hidden assets during your divorce.