One of the most contentious aspects of a divorce can be splitting up the property. Whether it’s who gets the marital home, or who takes some item of sentimental value, property division is about more than “stuff.” Assets represent security and the ability to rebuild your life. Keeping assets from a spouse in a divorce can also be a way to “punish” them for misdeeds, even though this is not what the law intends. In divorce, spouses are supposed to disclose all their assets and debts before dividing them. What can you do if your spouse is hiding assets in divorce?
The sooner you can take action, the better. It is always preferable to uncover assets before the divorce is final rather than afterward. Florida is an “equitable distribution” state. This means that the court will divide marital assets in a way that is fair and equitable under all of the circumstances. As a general rule, this division is usually pretty close to equal, but not necessarily exactly 50/50. If your spouse tries to hide or transfer marital assets to keep them from you, and the court finds out about it, the court may award you those assets instead.
PROVING THAT YOUR SPOUSE IS HIDING ASSETS
Of course, suspecting that your spouse is hiding assets, or even knowing it, is different from proving it. In order to penalize your spouse for hiding assets, the court will want evidence. So your first move should be to speak with your divorce attorney to find out what would be most helpful. There are certainly documents and records that your attorney can request through the legal process. However, if you yourself have access to bank statements, investment account records, pension plan documents, tax returns, and so forth, you should definitely make copies and get them to your attorney.
Documentation is important, because there are a number of ways someone can hide or dissipate assets. Someone may create a separate bank account and squirrel marital funds away in it, but it is not always that straightforward. If your spouse has a small business (or a relative or friend with one), he or she might launder money through the business. Your spouse could “sell” assets like motorcycles, boats, or other valuables to a friend for much less than they are worth during the marriage, only to “repurchase” them when the divorce is final. And, of course, a spouse can take marital funds and spend them on gifts for, or travel with, an affair partner.
The trickier your spouse is in concealing assets, the more difficult it may be for the court to connect the dots and see a clear link between their actions and the bottom line. It may be necessary to enlist the help of a forensic accountant to show what marital assets existed, and where they went. Your attorney can help you find a reliable professional whose testimony will carry weight with the court. A forensic accountant may be especially helpful if your spouse has complicated business dealings.
If you suspect your spouse of hiding assets, your divorce attorney may want to conduct more extensive discovery during the divorce. This may include taking depositions, in which your attorney will question your spouse extensively under oath. Your attorney may also serve your spouse detailed interrogatories (written questions) and requests for documents, which are also answered under oath.
CONSEQUENCES OF HIDING ASSETS IN DIVORCE
As noted above, a court may award you more of the marital assets if it finds that your spouse was deliberately trying to hide them or commit fraud. The court may also award you your costs (such as extra attorney fees and the services of a forensic accountant) in discovering the hidden assets.
If your spouse lied about assets during a deposition or under oath in court, he or she may be subject to even more penalties, including perjury charges. It is also possible, though not common, for criminal charges for fraud to be brought against a party who deliberately conceals assets in a divorce.
What happens if you didn’t learn that your spouse had undisclosed, or hidden, assets until after the divorce was final? You may be able to have the divorce judgment set aside, at least as far as the property division is concerned. This would allow the judge to order a different division of assets. If you and your ex-spouse had a settlement agreement (most divorces are settled, rather than tried), you probably had a provision in the agreement that stated that you both made a full and honest disclosure of your assets and debts. If it later turns out that your spouse lied about that, having such a provision in your agreement will make it easier to reopen your divorce and pursue a just result. If you suspect that your spouse is hiding, or your ex-spouse hid, assets during your divorce, contact an experienced Miami divorce and property division attorney immediately. We invite you to contact Jimenez Legal to schedule a consultation.