Divorce can get ugly, but hiding assets is never a good idea. It is both
unethical and illegal. In California, divorcing spouses are required to
file forms with the court to disclose all assets, including bank accounts,
real estate, and income. Giving false, incomplete, or misleading information
when filing official court documents during divorce proceedings, can lead
to serious consequences, including being held in contempt or being charged
Hiding Assets During Divorce Proceedings
California is a community property state, which essentially means that
spouses are considered a single community and any property acquired throughout
the duration of the marriage is owned equally by both, regardless if a
spouse is aware of the asset or not. Even if a spouse acquires and hides
money or property, it is still jointly owned.
There are many ways in which spouses might try to hide assets, all of which
are illegal and will result in some form of penalty. It is best to be
upfront about all assets and property.
One does not have to literally hide an asset for it to be hidden. For example,
the value of an asset is not always obvious. If you own property, such
as a home or rental property, you are required to get an honest appraisal
of the property for divorce proceedings. If you purposely understate the
value of an asset, this is another form of hiding assets since you are
withholding knowledge of the full and accurate value of an asset from
the court. To artificially reduce or destroy the value of an asset can
be considered an act of fraud.
Income & Expenses
A spouse’s income is also considered an asset. If a spouse understates
their income, this is also considered hiding an asset. Expenses are also
factored into the financial formula the court uses to calculate the value
of marital property, so purposely overestimating would also be considered
Investigating Hidden Assets
If you notice any red flags that suggest your spouse might be hiding assets
or being misleading in any way, you should consult with an attorney and
a forensic accountant who can detect the discrepancies, such as incomplete
financial information or missing documents, within your ex’s finances
and what he or she might be hiding.
As previously mentioned, there are consequences to lying, hiding, or misleading
the court when it comes to the value or existence of assets. Depending
on the particular circumstances and nature of the deception, these penalties
can vary greatly and are left to the broad discretion of the judge. Common
penalties include awarding a greater distribution of assets to the other
spouse, payment of the other spouse’s attorney fees, contempt, or
perjury charges. Ultimately, lying is a much more costly proposition than
simply being upfront and honest with the court.
Protect Your Assets & Property
Dividing assets and property is an extremely stressful aspect of divorce.
At Stolar & Associates, A Professional Law Corporation, our goal is
to help protect your assets and resolve your property division issues.
Our Beverly Hills legal team approaches each case we handle with diligence
and care, providing experienced and attentive service from start to finish.
Regardless of the complexity of your case, we have the knowledge and resources
to reach the most effective solution for your circumstances. With more
than 30 years of combined experience, you can be confident in our ability
to address all of your concerns.
Learn more about how we can help you. Call us today at 310.984.1411 to
schedule a consultation.