When divorcing in California, a couple’s community property is typically divided so that both spouses end up with roughly the same value in assets and debts. However, sometimes one spouse will hide assets to prevent those assets from being divided in the divorce.
Behavior like this is both unethical and illegal, but when a family has a complex financial situation, sometimes one spouse believes he or she can get away with hiding assets. Fortunately, there are ways to uncover this kind of dishonest behavior.
Typical ways people try to hide assets
First, it may be helpful to understand some typical ways people may try to hide assets. Some common ways, include:
- Stashing cash
- Purchasing items that could be undervalued
- Overpaying on taxes or debts with the intention of receiving a refund after the divorce
- Deferring salary or bonuses until after the divorce
- Creating fake debts with family members
- Asking family members to hold assets until a later time
Uncovering hidden assets
If your spouse is hiding assets, you may be able to uncover them by carefully going through your personal financial records. Try to follow money movements, especially when there is an unexplained increase in activity. You can also look for expenses that seem higher than they should be, as well as significant financial components your spouse failed to communicate with you.
In addition to reviewing your personal financial records, you can also carefully review your spouse’s voluntary disclosures during the divorce process and make note of any errors you find. If needed, you or your attorney may also be able to make a formal request for financial information, called an interrogatory, or inquire about assets during a deposition, which is a sworn testimony in front of a court reporter.
Although distrust is common in divorcing couples, sometimes that distrust is warranted. If your spouse has hidden assets, legally bringing those assets to light may be the best way to ensure you receive your fair share of community property in your divorce.