Divorce is rarely easy, especially when substantial assets are in the mix. The urge to protect what you believe is rightfully yours is understandable. Still, attempting to hide assets can lead to severe legal and financial repercussions that ultimately harm both parties.
Hiding assets is illegal
Both parties must disclose all their assets fully and honestly in divorce, among many things that spouses should and should not do. This can include money, property or other valuables. Some people may attempt to hide assets during divorce by:
- Transferring money to friends or family members
- Underreporting income on tax returns
- Creating fake debts
- Delaying business deals or promotions until after the divorce
- Overpaying taxes to get a refund later
- Purchasing expensive items that may be easily overlooked
- Hiding cash in safe deposit boxes or at home
- Deferring salary or bonuses
- Creating shell companies to hold assets
These actions may seem tempting but are illegal and can backfire dramatically. Courts strongly disapprove of asset concealment, and judges have extensive authority to penalize those who do so.
Hiding assets in divorce can result in an uneven distribution of marital property, potentially favoring the other spouse. The court may also order payment of the other spouse’s legal fees and hold the offending party in contempt of court. In extreme cases, there may be criminal charges for perjury or fraud.
Safeguard your properties legally
Digital forensics and financial investigations have made it increasingly difficult to hide assets successfully. Experienced attorneys and forensic accountants can often uncover hidden wealth by carefully examining financial records, tax returns and digital footprints.
If you are going through a high-asset divorce or suspect your spouse of concealing assets, act as soon as you can. Gather evidence, document your concerns and keep an eye out for questionable actions regarding finances. Working with a skilled Pennsylvania divorce attorney can also be advantageous.